Travel

Travel agencies Reinvented.

Hi FlightBlitz Readers!

I stumbled upon this old article I wrote over 3 years ago. It’s an inside view on the perspective of travel agents, so for those who don’t use agents, but wonder why 40% of the US Travel bookings ARE done through Travel agents – it’s worth the read to find out why and what you may be missing out on. For those who do this will explain the real value for you in a tangible way.

Written  in 2015:

The old Travel Agency Industry has been a dying business for the last 15-20 years. The Internet automated the jobs of travel agencies. The job of yesteryear’s agents was to manually find and book tickets. Today you can do that on Expedia.com in as little as 5 minutes, making travel agents, who would charge a fee for this service, redundant. Many online booking sites charge only a small $7-10 booking fee. Today, almost no one needs you to find the cheapest flight, or book a ticket – that, they can do themselves online (besides a few people with strong old habits). So, travel agencies, whose core function was to sell tickets for airlines, found themselves out of business.

Travel agencies used to be an extension of the airlines. Airlines would get as many travel agents as they could, to sell their flights. More agents, equaled more salespeople, meaning higher revenue and profits for the airlines. The travel agent was practically an airline employee.

The Internet brought automation, and amazing search and comparison capabilities. Technology transformed the airline industry, creating increased competition and benefiting both consumers in terms of price and ease of access, as well as airlines, who now had cut out the middleman and replaced it with websites, and automation. This business model was completely scalable, and those who embraced it, succeeded tremendously.

Many travel agencies shut their doors and went find work elsewhere. Computers had given them a huge blow. As hard as it must have been, they had to start looking for a new source of income. Thousands of agencies packed up, but some agencies saw a spike in customers.

The spike was generally seen in 2 segments. The first segment, was the Luxury Traveler, and the Businessman who didn’t have time, or those who wanted an expert to plan complicated trips, unattainable to the average person, those who wanted the type of perfection only a seasoned travel arranger could provide. So they went to the highly experienced agents, willing to pay for their luxuries. These included the affluent, as well as upper middle class.

The second segment were people booking complex itineraries. Until today, over 20 years of coding hasn’t been able to create a system capable of finding and creating a round-the-world itinerary, at anywhere near normal prices. So, people looking for round-the-world flights or complex multi-city and multi-airline itineraries, often found that agents were able to provide better prices than online.The travel agencies who excelled in luxury itineraries or complex flights, grew and the rest declined.

Everything seemed great, until things started going very wrong. As airlines rushed to compete with each other in capacity and pricing, they began compromising on their customer service. The golden era of flying, when it was a luxury to fly and flight attendants would go the extra mile for passengers, ended and then came the dark era of flying.

The dark era of flying began with the internet era, continuing into the 21st century. Flights were often delayed, customers treated like cattle herded onto planes, packed like sardines, as capacity was pushed to its limits. Bags went missing quite often, and airlines began extorting fees for everything. Flights were overbooked, and cancellations were very common. Compensation, while at first hefty, all but disappeared. Upgrades to first class became a “legend”, an airline who listened to customers was a “myth”. Internet blogs began filling up with the most horrific stories, daily, of airline after airline and their bad treatment of customers. Customers were no longer being treated like gold, they were being treated like dirt. Except some customers…

The exception was customers booking through good travel agencies. These people were seeing a completely different style of travel unravelling before them. While people booking through sites like Expedia.com would wait for over an hour to speak to an outsourced agent in a call center in India, when their flights were delayed or cancelled, to get rebooked – customers who booked through travel agents, were only a whatsapp message or quick email away. While the Indian Expedia agent, who had worked at Expedia for 5 years, was powerless and couldn’t do anything besides refer them to the airline, (which had a line of another 200 people waiting to be rebooked) – travel agents were able to authorise complimentary rebooking, compensation and even confirm meals for their customers without them needing to break their teeth explaining their situation – they knew their customers and what they wanted and needed – because they were ‘their agent’. The travel agent had access directly to the airlines’ inventory, and had private numbers to dedicated travel agent airline representatives, who authorised rebooking for them, 24/7, within seconds of calling.

Online Travel Agents like Expedia focus their money on getting customers to book. Once you are booked and they have their commission, the flight is “a done deal” so service is not of essence. You are stuck. The goal is get as many people to book as possible. To change a flight with expedia, the average wait time is an entire hour on hold. That is before the agents, who are generally almost completely useless, take another hour to actually tell you any half normal options, let alone actually make the change for you. Smaller online booking sites are much worse. Booking directly with the airlines means that you may by luck have smarter reps (Airlines have plenty of bad reps too), but wait times and assistance are not better, and the airline tacks on fees for changes made by phone. When you have an issue and you have booked through the airline directly, they are rarely ever interested in properly accommodating you.

How the Travel Agencies got back on top was through the customers. People refused to fly with horrible customer service. Knowing they had no-one to call when things went wrong, was not worth the headache to many travelers, to the tune of almost 40% of them. Airlines tried to eradicate the travel agent, but customers refused to buy from the airlines and be stuck without assistance. They wanted someone with direct access to the airlines’ inventory, as well as a mastery of the travel industry, advocating on their behalf when they flew. Travel agents were the best possible advocates, as they practiced this every day, with almost every airline. Booking through Expedia or the Airline directly, meant you were on your own. But if you went to your agent, you had an advocate.

The travel agent swapped, from advocating for the airline, to advocating for the customer. This was invaluable, for a market shift, where the average customer was all but abandoned when flights were cancelled or delayed. So travel agents formed consolidations, where hundreds of agents grouped together to form a huge bloc of buying power. They then approached the airlines and negotiated contracts with each of them. Airlines who saw that the bloc represented to their company hundreds of millions of dollars annually, knew they needed to keep these agents happy, so they dedicated specially trained staff with almost absolute power, to be their “sales agent managers”. Airline sales agent managers were created to ensure that travel agents would be happy with the airlines. Travel agents were happy with the airlines, when their customers were happy with them. Customers were happy with travel agents, when agents were able to ensure that if an issue arose during a trip, the agent was able to successfully resolve their issue to their liking.

To illustrate this better, here is an example of a situation which occurred last week. A client booked a flight from London to Johannesburg, to arrive before Shabbos. The flight was booked via Frankfurt, as, even though there were three other airlines that offer direct flights, this was the cheapest option.

After arriving in Frankfurt, the passenger was told that the flight was delayed. A little bit later the flight was pushed off from 10pm Thursday night, until 1:30pm Friday afternoon. The flight would arrive on Shabbos, meaning the client would not make it there in time.

Everyone was offered to spend the night in a hotel and fly the next morning. The client requested that  they fly her back home for Shabbos and fly her again on Sunday night from London to Johannesburg. The airline desk refused to accommodate her. After begging and even crying, they only agreed to put her on standby for the Sunday night flight from Frankfurt to Johannesburg, as the flight was now overbooked. They said they would “confirm” her a seat for Monday night, so if she couldn’t get on the Sunday night flight, (which was heavily overbooked and had a low chance of getting on), she would waste 24 hours waiting for the next flight – a day later.

The next morning she whatsapped me what happened and that she had even made one last try at the airport, to no avail. I told her not to worry, as I would take care of everything. And this, is where the difference lies, between booking through the airline directly or through a travel agent.

I got her confirmed on the flight back to london within minutes, and right before she got on her flight – I told her i’d fix the way back for her too.
Before her 90 minute flight landed, I had already received authorization, and rebooked her onto the South African Airline’s direct flight on Sunday, from London, free of charge. Not standby. I had it confirmed. I had lodged a complaint on her behalf for compensation of 600 Euros, of which she didn’t even know she was entitled to, by European law. This will arrive at her address in a few week’s time and of course, I had her Kosher meals ordered and confirmed for her Sunday flight. She landed with her itinerary and airline compensation case number in her inbox, and a whatsapp message explaining the good news.

How was I able to pull this off? The consolidation group that my agency is part of, spends hundreds of millions with lufthansa annually. We represent a huge volume of their profits and business from the USA. We have a good relationship with them, so helping make sure my clients are happy, is a sure way to allure me into using them more often. The customer on her own, will spend maybe a few thousand dollars with them, in a decade. Advocating on her behalf, was a travel agent with significant leverage. This was the new travel agency of today.

To summarize, travel agents, of yesteryear are extinct. Airline customer service has dropped to all new lows and online booking sites offer absolutely no influence or support in case of mid-trip issues. To an airline or booking site, the aim is to get you to book, so they secure non-refundable booking fees and commissions. The travel agent, entices customers to book through them for the value of their advocacy, experience and service, from the booking process, to the end of the journey and beyond. The travel agent has swapped from advocating for the airline, to advocating for the customer to the airlines. The savvy traveler has an even savvier travel agent.

The internet has eliminated the need for travel agents to manually book your ticket. Nowadays, travel agents have almost everything done automatically too. But the internet has also created a niche market for travel agents. Agents are now powerful advocates for their customers and can do some of the most amazing things you would never believe possible. Without a good Travel Agent, You simply can’t have true peace of mind in Travel anymore – not even for the top tier elite flyers – and especially not for non-elites.

The travel agent of the 21st Century is now a cornerstone of luxurious Travel.

By David Kaye.

Director of FlightBlitz
A Member of ASTG, Tzell, and Travel Leaders Group Elite Travel Division.

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