You could forgive British holidaymakers for feeling a little confused in the past few weeks.
One day, the national press is reporting tour operators have slashed prices on summer 2018 holidays, offering deals of up to 50% off.
Then, this week, the media ran scare stories about the weak pound meaning spending money won’t go as far this summer – and about holiday prices soaring by almost a third next year because of the additional costs travel companies with UK staff based in Europe will face post-Brexit.
But even if consumers have heard mixed messages about holiday pricing, the travel industry is largely accepting that prices are going to rise in 2019 and beyond, not only because of Brexit but also the rising cost of oil. Note, however, Aito director Noel Josephides’ warning this week about diminishing yields in the Med.
Many tour operators have also already increased prices in 2018 to counter the challenge of absorbing credit and debit card payment fees. This week, we hear a long-overdue consultation about Payment Services Directive 2 by the government could be on the cards, but even if the legislation can be overturned, it would likely take some years to resolve.
The issue of higher tour operator prices is, of course, a double-edged sword for retailers: the opportunity to earn more commission on one hand, but the risk of being unable to sell the product if the difference between the prices an agent gets from their tour operator partner, and what a customer can package themselves online, widens.
As retailers adjust to a market in which prices are higher and consumer expectations of what they can get for their money have also increased, it will yet again be down to agents to ensure they add value every step of the way – offering the kind of service that you simply can’t put a price on.