ao link

 

Attendees

  • Chris Boba, Travelport
  • Paul Broughton, Travelport
  • Guy Chambers, Black Diamond
  • Richard Dixon, Holidaysplease
  • Mick Heitzinger, Flight Centre
  • Jennifer Morris, TTG Media
  • Matt Roclawski, TTG Media
  • Jonathan Sloan, Hills Balfour
  • Colin Stewart, Air Europa
  • John Sullivan, Advantage Travel Partnership

The forum was chaired by Pippa Jacks, group editor TTG Media

Advantage Travel Partnership commercial director John Sullivan agreed that the net effect of the Monarch saga had been to put the focus back on protection.

 

“We have Advantage Financial Services and we are very clear about how to protect yourself if you are dynamic packaging,” he said. “We also launched Advantage Holidays a year ago under our own Atol, which is also about protecting our members.


“Ultimately it’s not clear for the consumer though – and it’s up to agents to be as clear as possible when selling Atol-protected products.”

 

Continuing with this theme Colin Stewart, Air Europa director for UK and Ireland – and chair of the Latin American Travel Association – said: “How many consumers are aware if they are protected? They need to ask the right questions, but most consumers don’t want to think about it.”

 

Mick Heitzinger, product director at Flight Centre Travel Group, said: “We need to ask the government to make everything clearer. For us, there was a minor impact from Monarch, but our customers are resilient and more of our business is long-haul. When there is a challenge we come out on the offensive, go to town to look after our customers and worry about who pays for that later.”

Damaging confidence

Damaging confidence

Advantage’s Sullivan said the real impact from the Monarch collapse was how it had affected consumer confidence around airlines. “The consumer is looking at Ryanair and Monarch and thinking ‘What the hell is going on?’” he claimed.

 

The forum noted that confidence in airlines had already been undermined by British Airways’ shutdown in May following an IT failure – although they accepted this had appeared not to have had a long-term impact.

 

Guy Chambers, managing director at agency Black Diamond, said: “Memories are short and the price point is king. We’ve seen the share price hold up and they’ve done well from the business point of view. Time will tell if this affects them later on.”

 

Stewart added that it was the ongoing impact of low-cost carriers that was continuing to have the biggest impact on airlines. “The failure of Air Berlin, Monarch… Alitalia’s troubles – these aren’t coincidences. It’s the effect of low-cost carriers.”

 

Success for airlines would come not only through being competitive, but also through smart revenue management, he declared.

Airline surcharges

Airline surcharges

Increased profits could also be on the table through the introduction of the surcharge to agents booking through a GDS, with Air France-KLM recently announcing plans to join Lufthansa, British Airways and Iberia in introducing the fee.

 

Denouncing the move as a “discriminatory surcharge” against travel agents, Travelport’s managing director UK and Ireland Paul Broughton said that since Lufthansa introduced the charge in 2015, a number of airlines had been reviewing the issue.

 

“It’s discriminating against the channel that supports the airlines most effectively. Whether it’s a volcano or an airline failure, it’s the agent that looks after them. And now their channel of choice is going to be more expensive.

 

“Airlines admit they already get their highest market value through the intermediary channel.”

 

Air Europa’s Stewart admitted: “As an airline you have to consistently review your costs – and the cost of the GDS is the biggest channel in terms of distribution. If there’s an opportunity to reduce costs we have to consider that.”

 

Flight Centre’s Heitzinger added: “The travel industry is very resilient, whether moving to 0% commission or introducing e-tickets, no doubt it will continue to evolve.”

Future uncertainty

Future uncertainty

Surcharge or not, can the airlines achieve genuine growth amid the uncertainty of Brexit?

 

Heitzinger insisted the referendum result had had no impact whatsoever on business yet. “Our yields are on the increase. But our concern is that at some point travellers will wake up and start to panic.”

 

Stewart added: “As long as we are flexible, differentiating our product and providing customer service we’ll be in good shape.”

 

Jonathan Sloan, managing director of Hills Balfour, predicted continued growth in long-haul against short-haul travel, adding: “People will always travel, it’s a mature travel market.”

 

Richard Dixon of Holidaysplease said his business’s average selling price per holiday had recently increased from £4,200 to £4,600, with overall business up 30% and “flying”.

 

Black Diamond’s Chambers added: “Whatever happens I think that we will see more luxury travel in future and more prices genuinely rising. The ILTM exhibition [in Cannes next week] is now really taking hold and destinations are very keen to be represented there.”

 

Bringing the event to a close, Travelport’s Broughton said: “With consumer confidence and the market strong overall I’m expecting another growth year in 2018.”

Comment Paul Broughton: ‘We embrace NDC’

“One of the challenges the industry faces is managing the increased fragmentation of travel content. Agents now face further complications under the guise of Iata's New Distribution Capability (NDC) and surcharge initiatives to encourage agents to connect to multiple direct connects to obtain pricing and offers.

 

“Travellers are increasingly looking for a trusted voice. A travel professional who knows them and can guide them through the maze of choices and curated offers. They would love a single source for all the information and help they need. The challenge for the agent is to find the right handful of relevant and available options at a price that will be acceptable. That’s why it’s so important for agencies to have fast and easy access to the broadest possible choice in travel content.

 

“We know the industry needs to transform the way flights are sold and Iata’s NDC is an important part of this. Yet with these so-called direct connections, agencies lack workflow automation, change management, agency robotics in fulfilment, managing airline changes such as schedule alterations and disruptions and more. Travelport is not standing in the way of NDC. We embrace it: we are already level 1 and 2-certified by Iata.

 

“When you combine smart and efficient tools with the personal touch of an agent, it becomes a winning combination. It’s why Travelport continues to invest so heavily in providing unrivalled content and technology to its agency customers.”

 

Paul Broughton, managing director for Travelport UK and Ireland

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