The diversity among sellers of travel has become so great that the Travel Weekly Power List, which for more than 20 years has ranked which companies sell the greatest volume of travel-related products, has evolved into a listing that contains not just apples vs. oranges, but apples vs. oranges, huckleberries, kumquats, dragonfruit and purple mangosteens.
When compiling the list, we're not fussy about what business model companies use; we simply want to know who sells the most travel to consumers. We don't care if travel is sold out of a home office, a call center in the Philippines, a Rodeo Drive storefront, a table at Starbucks, by an army of multilevel marketers or from a Facebook page -- provided the company's CEO or CFO is willing to certify that they are the agent of record for the sales figures they report to us.
This year's ranking includes online travel agencies as well as multi-outlet storefront agencies dependent upon leisure sales. There are corporate travel management companies, cruise specialists and aggregators of agencies -- consortia, franchisors, home agency hosts -- or combinations thereof. High on the list are companies for which travel seems to be a side business: American Express (No. 2) is primarily a financial services company, and AAA (No. 9) makes far more money selling insurance than it does selling travel.
You'll find incentive houses, loyalty marketers, group and meetings specialists, discounters, rebaters and packagers.
Side by side on the list are CheapCaribbean.com (No. 24) and luxury specialist Valerie Wilson Travel (No. 25). No. 29, Global Crew Logistics, sells almost exclusively to aviation and maritime crews. Some listees rely on self-booking tools, others on face-to-face counseling.
Power List companies are privately held and publicly held, family businesses and the brainchildren of entrepreneurial MBAs. Most of the companies are American-born, but others originated in Asia, Australia, Europe or Canada.
Every year, Travel Weekly discovers potential new entrants that challenge our assumptions about how travel is sold and force us to look at our rules afresh. Technologies that enable third-party sellers and white-label sites have led us to double-check just who, exactly, is the true agency of record, from the supplier's point of view, and thus earns the right to claim credit for the sale.
One indication of the innovation that drives travel sales is that despite multiple mergers and acquisitions in retail travel every year, with one Power Listee often swallowing another, the ranking nonetheless contains more or less the same number of agencies -- about 50 -- every year, each of which has sold $100 million or more in travel. For every agency that disappears through a merger, another has found a new or improved model that propels it onto the Power List.
It's also remarkable that the number remains steady in the face of much more aggressive efforts for direct sales by suppliers. Likewise, the proliferation of start-up discount sites or the growth of existing discounters does not appear to have a significantly dilutive effect on overall sales.
The rise of travel as an industry -- we have chronicled its ascension and have previously reported that it's poised to become the largest industry in the world -- seems to more than compensate for any drop in prices brought about by discounting, increased competition, temporary oversupply or economic uncertainty.
But given the sheer number of factors that can challenge an intermediary that sells travel, we feel safe in predicting that the big will continue to get bigger, and every business that can will work to increase scale. Being big helps; it's much more likely that an agency will disappear from the list after being absorbed by a larger agency than fall off due to dropping sales. Though not an ironclad insurance policy, scale is clearly important.
There is one question about travel sales that the Power List can't answer: How are smaller agencies that are unaffiliated with Power List businesses doing?
In separate research that Travel Weekly conducts, we've found that the average sales for individual travel sellers (whose totals might or might not ultimately be included in Power List sales figures, depending upon their affiliation) moved up from about $3 million to $5 million over the past decade, with most growth showing up at the bookend sides of the business, i.e., small home-based agencies and ones above $10 million.
Our conclusion: Size matters. In travel, the middle ground tends to be rough territory.
Email Arnie Weissmann at [email protected] and follow him on Twitter.