HOW DO TRADITIONAL TRAVEL AGENCIES COPE WITH THE DIGITAL ERA?

According to a Google Travel study, 74% of travellers plan their trips with the help of the Internet and only 13% remain the usage of travel agencies to plan their holiday destinations. So the question is, will the number of travellers plan their trips over the Internet continue to increase? And if so, how do traditional travel agencies cope with the shifting trend?

Mind Your Own Business
Nov 5 · 4 min read

Embrace O2O Strategy. There is no point fighting the inevitable domination of the Internet so the conventional travel agencies would need to adapt. Slightly over a month ago, one of Malaysia’s leading travel agencies, Parlo Group, has been in the traditional brick & mortar business for over 30 years, decided to adapt with their self-developed Marketplace by Tbroker, a cloud-based digital platform for the usage of themselves and their participating agents. Within a short span of a month, they have successfully achieved nearly 170% growth in the number of agents.

Partner with Digital Players. Beyond providing products and services through the physical outlets or during travel fair roadshow, it may cost a lot in terms of both financially and resources to develop an own digital platform from scratch for most traditional travel agencies. An alternative to be visible in the digital space, partnering with digital giants and get its products and services listed in the digital travel agency helps traditional travel agencies to cope within this digital era.

Increase Offerings to Meet Market Demands. The power of Internet in this digital era allows travellers to seek the best deals and the preferred options with just a click. In this day and age, it is all about diversity and varieties. No doubt being a product specialist by keeping the core product is vital, however it is equally important to have a diversify range of product offerings whether the product is owned, or it is offered by the partners. Using Parlo Group as an example, it originally offered its own product by its division Parlo Tours, Affordable Group Tour (AGT), Musaffir-Go and its existing partners of Europamundo. Now, it is in the middle of roundtable discussions with multiple partners, such as Klook from Hong Kong and Bedsonline, the travel giant with over 40 years of experience within the same industry. Sharing resources and expanding product offerings is one of the ways that conventional travel agencies can use to cope with this ever competitive market.

Strengthen the Value of Physical. As much as the digital world offers accessibility, convenience and potentially variety, there is still an undisputed power of physical outlet or a human touch. A physical outlet with a physical human with a concrete item that allows customer to touch and feel plays with the emotional heartstrings of customer which functional value are not able to achieve. As the saying goes “people don’t care how much you know until they know how much you care”, great customer service that assists a customer during pre-purchase, purchase and also post-purchase is vital. From providing instant information, real-life experience, interacting and engaging with the customers is all part and parcel of the key strength of a physical outlet.

Expand Target Market. Traditional travel agencies with physical outlet is often bounded by the limitation geographically. Beyond that, many other factors that could also play a part in the restricted customer base. Although some may be able to play the niche market game and excel, for most of the other traditional travel agencies, it is important to eliminate whichever possible barrier there are in order to expand the pool of customers or type of customers. For instance, Parlo Group is aware of the challenges faced in the series tour group and has decided to shift some of its resources to develop a trip planning tool, allowing its agents to serve Free Independent Travellers (FIT) better as they will get accessibility to amazing experiences such as hotels, transfer, on ground activities and attractions at an even more competitive price. According to an article published by WiseGuyReports.Com in 2018, the Sports Tourism industry maintained a relatively optimistic growth, from 2014–2017, the market size to maintain the average annual growth rate of 5.9% from $261million in 2014 to $310million in 2017, and the analysts believe that by 2022, Sports Tourism market size will be further expanded, reaching $429 million. It is unsurprising, travel company such as Parlo is expressing interest in tapping into the sports tourism market whilst other brands such as Audi and Nike is already ahead by sponsoring the e-Sports events.

Mind Your Own Business

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