Travel agents are more than recouping losses from dwindling airline commissions and new online competition by focusing more on vacation and cruise packages and charging their clients fees to generate revenue.
Nearly half of the 450 agencies surveyed by the American Society of Travel Agents (ASTA) say their client bases have grown since last year.
About half of these travel agents report as much as a 10% increase in customers. Around 30% of the agents note up to a 20% hike and another 13% claim they gained as many as 30% more clients.
Fees Commonplace
Most travel agencies have instituted a variety of client fees since the airlines began cutting travel agent commissions in September 1998. More than 70% of agents currently charge these fees. The average charge per airline ticket is $10.37.
Small agencies are less likely than large ones to assess fees. About 53% of agencies with sales under $1 million take these fees; 68% with sales above $1 million do the same. The median fee for planning and researching travel for a client is $50.
ASTA says independent e-commerce research shows that 77% of travelers who never have booked trips using the Internet prefer speaking with knowledgeable travel agents rather than making travel plans online.
Bookings made by Internet travel services represent only about 1% of all travel reservations, according to ASTA. Nevertheless, more than 13% of travel agents surveyed by the society say the most common reason for losing customers is the Web.
Still, many travel agents view the Internet as more of a tool than a competitor.
According to a study conducted by the U.S. Tour Operators’ Association, some 67% of travel agencies use the Net for research but rarely to make travel arrangements.
– Growth trends indicate travel services will become the largest contributor to the U.S. gross national product within a few years. Travel and tourism now account for 6.7% of the GNP.
– Total sales by travel agents exceed $100 billion annually. Last year agents booked some $50 billion in ticket sales alone. About 75% of airline tickets and 95% of cruise ship tickets were sold by agents.
– Women dominate the travel industry. Some 88% of travel agents, as well as 80% of travel agency managers, are women. A manager’s typical salary is $32,100.
– The average salary for travel agents is $23,700. Nearly one-third of them receive a salary as compensation without any commissions. About 21% work on straight commission, 13% get a combination of the two and the rest earn hourly wages.
– Travel agents are primarily teleservices oriented. More than half of all travel agencies book better than 75% of all tours by phone. Nearly 71% of these agencies arrange more than three-quarters of all cruises over the phone.
– About 89% of travel agents have Internet access. E-mail is used at 82% of travel agencies. Some two-thirds of the agents surveyed use the Net often, but only about 8% use it to book reservations.
– Cruises and tour packages are perceived as growth markets by travel agents. Many agencies believe that the smaller commissions paid by airlines have made airline ticketing more a convenience for clients than a stable source of revenue.
– The five states where travel agents arrange the most trips are Florida, California, Nevada, New York and Hawaii. The five most popular cities booked by travel agents are Orlando, FL, Las Vegas, San Francisco, New York and Los Angeles.
Sources: American Society of Travel Agents; National Association of Commissioned Travel Agents; U.S. Tour Operators’ Association
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