Bill Maloney, CTC Executive Vice President & COO ASTA

1

Bill Maloney, CTCExecutive Vice President & COO

ASTA

Travel Intermediaries: Are Consumers Still Willing to Pay?

2

New Struggles for Travel AgentsNew Struggles for Travel AgentsNew Struggles for Travel AgentsNew Struggles for Travel Agents

• Economic challenges

• Reduced availability of credit

• Difficulty meeting short-term obligations

• Disappearing commissions

• Consumers under siege

3

Are Consumers Willing to Pay?Are Consumers Willing to Pay?Are Consumers Willing to Pay?Are Consumers Willing to Pay?

U.S. travel agents are finding the answer is a resounding “YES!”

YES

!

4

Is the Link Broken?Is the Link Broken?Is the Link Broken?Is the Link Broken?

1988Travel documents

Information

2008?????

?????

5

Surveys Ask ….Surveys Ask ….Surveys Ask ….Surveys Ask ….

• Who is using travel agents?

• Are they willing to pay a travel agent for their expertise?

• How much are they willing to pay?

6

Survey Says …Survey Says …Survey Says …Survey Says …

Younger and less affluent travelers (< $75,000 / 54,900 €) valued and used the services of a travel agent as much, if not more, than did affluent travelers (> $150,000 / 110,000 €).

Data excerpted from chart on Travel Agent Usage

7


Consumers, regardless of income, are much more willing to pay for a travel agent’s services if they see themselves as

getting new suggestions. Convenience, was cited as being the second most important motivator overall.

8

Survey Says …Survey Says …Survey Says …Survey Says …A significant percentage used a travel agent every time they took a trip,

regardless of complexity. Travelers (18-34) represented the highest percentage—12 %—of those who used a travel agent in every instance.

Young (18-34) Old (55+) Men Women

Less Affluent Affluent

Air 15% 5% 10% 7% 12% 7%

Hotel 12% 3% 9% 5% 10% 3%

Car Rental 10% 3% 6% 5% 7% 5%

Cruise 14% 15% 14% 17% 15% 19%

Trip package 16% 10% 15% 12% 14% 14%

Tour at Destination 9% 7% 9% 7% 10% 5%

Trip planning 11% 6% 11% 5% 10% 6%

Visa/Passport related services 9% 2% 5% 3% 4% 7%

Overall average 12% 6% 10% 8% 10% 8%

9


The main reason consumers opt not to use a travel agent is the perceived lack of control.

79%

85%

81%

78%

86%

77%

88%

83%

87%

45%

39%

22%

34%

33%

27%

30%

44%

34%

40%

37%

27%

33%

35%

34%

29%

32%

42%

18-34 Years

35-54 Years

55+ Years

Male

Female

$0 - $75K

$75K - $100K

$100K - $150K

$150K+

Easier to Research/Book Myself Don't Want to Pay Travel Agent FeesMore Options When I Plan/Book Trips Myself

Graph shows data related to Reasons for Not Using a Travel Agent for Purchasing Airline Tickets. Results proved similar for every travel segment and every demographic.

10


Consumers were most likely to have paid a service fee for air bookings and vacation packages, and less likely for car rental and cruise bookings.

Fee Structure Paid when Booking Airline Tickets Fee Structure Paid when Booking a Cruise

11


When it comes to service fees …• Consumers said they prefer a flat fee rather than

percentage-based fee. • Flat fees provide consumers a greater feeling of control

%

12


The largest percentage of consumers said they would still use a travel agent to purchase a tour package, book a cruise or plan another type of trip if a fee was involved.

Graph shows data related Continued Use of a Travel Agent if Fee is Charged Purchasing a Vacation Package.

13


What’s acceptable?

• $15/11€ to $100/73€

• Air travel = $20/14€

• Cruises = $50/37€

14


Travel Agent Usage Percentage Willing to Pay Fee by Segment - Upper Limit

Overall, 43% of respondents were willing to pay a fee for any travel agent product or service. A significant portion of consumers across all demographic categories would pay fees without an explanation of the benefits of using a travel agent.

15

Age as a VariableAge as a VariableAge as a VariableAge as a Variable

Young (18-34) Old (55+)Average annual household

spending for leisure travel/business travel

$4,089 / $5,468 $5,771 / $6,537

Used a travel agent in the past 12 months

58% 44%

Average percentage that uses a travel agent every time they book leisure travel.

12% 6%

Continue to use an agent to book airline tickets if charges a fee.

34% 17%

Continue to use an agent to book a cruise tickets if charged a fee.

33% 38%

Average percentage willing to pay a service fee.

51% 39%

16

Gender as a VariableGender as a VariableGender as a VariableGender as a Variable

Men Women

Average annual household spending for leisure travel/business travel

$4,925 / $6,627 $4,779 / $5,909


51% 44%


10% 8%


23% 22%


38% 32%


44% 43%

17

Income as a VariableIncome as a VariableIncome as a VariableIncome as a Variable

Less Affluent ($75K or less)

Most Affluent($150K+)

Average annual household spending for leisure travel/business travel

$3,195 / $4,389 $8,345 / $10,561


49% 49%


10% 8%


28% 17%


34% 32%


45% 40%

18

Working on Your BehalfWorking on Your BehalfWorking on Your BehalfWorking on Your Behalf

ASTA …• creates an institutional body of learning from which all

members benefit;• provides a variety of online tools and 24/7 access to

global network of travel agents and suppliers;• works hard to keep pace with the changing needs of

consumers;• NEEDS YOU!

19

Getting InvolvedGetting InvolvedGetting InvolvedGetting Involved

• Get informed. Sign up for ASTA SmartBrief on ASTA.org• Members: Visit ASTA.org daily

– RSS feed – Buyer’s Guide– Dateline Weekly International Member spotlight– ASTA’s Worldwide Destination Guide – WebExchange

• Non-members: JOIN!

20

Thank YouThank YouThank YouThank You

ASTA can be the architect, but without your help as bricklayers, we won’t have a strong foundation upon which to build this industry.

Documents

Bill Maloney, CTC Executive Vice President & COO ASTA