2010 to Date: The Good and the Scary
By Doug Cooke, Publisher
Now that we are well into the 3rd quarter of what is supposed to be a year of recovery, how is the travel industry really doing? Are we skipping up Easy Street or are we plodding down Recovery Avenue? Or does it depend on what sector of the industry you are in? Industry research leader Phocuswright held a webinar this past week to discuss Q2 sales and expectations for the rest of 2010. This information combined with the latest ARC report tells a tale of slow and steady growth for 2010. However, there were also some scary revelations for travel agents, as shown below.
The Good
There is no question that the airline industry is in a state of recovery and renewed profitability. According to July ARC reporting, total airline transactions are up almost 8% year to date, while total sales are up 20%. Airfares, as we all know, are on the rise and were up over 15% in Q2 compared to last year. Airlines are enjoying near record high load factors due largely to the fact that capacity has been reduced by 15% over the past couple of years.
Hotel and resort sales are also up a healthy 9% year to date.
The Phocuswight research also revealed some good news for travel agents. While the OTA’s (Priceline, Orbitz, etc.) are still outpacing offline sales (travel agents) the growth of bookings on the OTA’s is slowing and in fact the sale of air is shifting back to more traditional channels and suppliers. Their research further revealed that OTA’s have had very limited success in their attempts to break into the “packaging of travel services,” i.e. the online sales of tour packages. This lucrative business is still bought primarily through travel agents.
The Scary
Phocuswright research indicates that OTA marketing/advertising spending was down in Q2 of 2010. What’s so scary about that? The fact that they still spent over $400 million combined in their ongoing efforts to convince your clients to book direct. And how much was spent so far this year by anyone to convince consumers to book with a travel agent? None that I am aware of, and therein lies the problem. The travel agent distribution system needs an organization that will champion its cause and launch a massive and ongoing advertising/public relations effort to compete with the OTAs. In my mind ASTA is the natural choice and I trust that whoever they hire as the new CEO will look to steer the organization in this direction.
And what does the outlook for the rest of 2010/2011 look like? Most research indicates a slow yet steady recovery through the rest of 2010 and an even better year ahead in 2011.
GREEN CORNER |
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Selecting the Right Host Agency or Consortia By Doug Cooke, PublisherA s the number of brick and mortar agencies continues to decline, with the latest ARC statistics reporting 15,457 locations (down 8% from July 2009), more and more travel agents find themselves in need of a “home” for their business. Most industry suppliers require some sort of proof of an agent’s professionalism whether it be an ARC, CLIA or TRUE number. As more agents take their businesses home, they Read More... |
Home Based Travel Agent Registry By Doug Cooke, PublisherI have been very happy with the positive response from the “soft launch” of our new Home BasedTravel Agent Registry (HBTAR) announced on this page last month. Both travel agents and travel suppliers have responded by signing up and sending us letters of encouragement and support for a service that has been needed and is long overdue. Our idea Read More... |
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2010 EDITORIAL CALENDAR |
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| OCTOBER COVER: GERMANY Africa & Mid. East: Israel, African Safaris Asia & S. Pacific: India, China Caribbean:Antigua & Barbuda C. & S. America: Brazil Carnival, Cancun-Mexico Cruise News: Worldwide Cruise Guide Europe Spain, Greece Industry News: Travel Technology USA & Canada: Southern Florida SUPPLEMENT: 2010 Guide to worldwide cruises Editorial material/Ad space reservation: September 2 Ad material is due on or before: September 10 |
NOVEMBER COVER: CYPRUS Africa & Mid. East: Ethiopia, Qatar Asia & S. Pacific: Japan, New Zealand Caribbean: Holiday Packages, Jamaica C. & S. America: Peru, Panama Cruise News; Caribbean Sailings, Ship Review Europe: Belgium, France News: Home Based Agent, Hosts, Co-ops and Consortia USA & Canada: New York City, NY, Ski the West Editorial material/Ad space reservation: October 7 Ad material is due on or before: October 15 |
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DECEMBER COVER: ISRAEL |
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This Editorial Calendar was last updated on:
Tuesday, August 31, 2010 11:33 AM
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