Editor in Chief's Message
The past two Travel Weekly annual Travel Industry Surveys uncovered some decidedly downward revenue trends, so we take the mixed signals we're getting this year as a step in the right direction.
Overall, sales by agencies were up impressively. But as far as individual agencies go, more saw a decrease than an increase.
What are we to make of that?
In aggregate, large agencies and home agencies did better than midsize ones. Perhaps it's because each has an operational advantage, with large agencies exploiting economies of scale and home agents realizing lower overhead costs. This operational edge may have allowed the two ends to focus more time and money on soliciting business.
But midsize agencies with decreasing sales are facing some tough choices. As they ponder what to do next -- and hoping the economy will recover, by the way, is not a business plan -- they might look to recent airline behavior for examples of what to do and not do.
We've watched over the preceding decade how some airlines' unrelenting focus on cost-cutting resulted only in the diminishment of service and an increase in customer dissatisfaction. Customers lost olives in their salads, pillows in the overhead bins and call center agents whose native language is English. But none of this solved the airlines' collective woes. They learned the hard way that it's not possible to simply cut one's way to profitability.
Interestingly, airline cuts occurred just as agents moved in the opposite direction, providing more service and in many cases evolving from order-taker to counselor.
Where did the airlines get it right? Charging ancillary fees for services they once provided for free.
It's not often pointed out, but it was actually travel agents, not airlines, who were the first to "unbundle" their offerings with the institution of service fees.
If your business is profitable enough without charging fees, more power to you. But if it's not, and you're feeling the pinch, it's something to reconsider.
Over the decades that Travel Weekly has conducted the Travel Industry Survey, the way a travel agency does business has evolved. Time and again, agents have proven themselves to be remarkably resilient and creative. I'm confident that we'll once again see the Travel Industry Survey looking less mixed and more resolutely positive.
P.S.: "Hope" may not be a business plan, but it doesn't hurt.
Arnie Weissmann Editor in chief
To view the survey in its entirety, click here.
Methodology
The 2011 Travel Industry Survey was based on the responses of 1,906 travel agents to an online survey conducted in July and August 2011.
Of the participating agents, 61% worked in traditional travel agencies and 39% were home-based. Among the traditional agencies, 33% worked in single-location offices, 15% were in branch offices, 9% worked in the headquarters office of multibranch chains and 4% described their office arrangement as "other."
This sample size offers statistical reliability in the range of 3% to 4%.
ASTA and Nacta research
The two ASTA surveys were conducted among members of the ASTA Research Family, a representative sample of ASTA members who take a series of annual benchmarking surveys on agency operations.
The data on technology and Web usage is based on the online responses from 360 agents collected in April and May 2011, with an error rate of plus or minus 4.8%.
The GDS survey data were collected online in May and June 2011 from 391 respondents, with an error rate of plus or minus 4.6%.
For the National Association of Career Travel Agents survey, ASTA collected data online in May and June 2011 from 560 of Nacta's 2,143 members. ASTA states that this reply level indicates an error rate of plus or minus 3.6%.