by Peter J. Bates

Monday, November 12, 2012

Consolidation Breeds Confidence & Renewed Focus on Partnerships

As marketers, we spend a great deal of time exploring consumer-related trends – what they seek from travel experiences, what influences their purchasing decisions, and more – but it is important to take stock of our own industry trends and how these impact stakeholders in our business.

These days, it’s all about mergers and acquisitions! Recent news of the merger between Protravel and Tzell as well as Travel and Transport’s purchase of Ultramar reflects the changing business landscape of our industry. These are two examples in the U.S., but consolidation is happening in other parts of the world as well. These recent deals are a sign of confidence in the travel business, and this eventually trickles down to the benefit of the consumer.

Consolidation Yields Buying Power
After several years of tumult in the travel industry, the past 12 – 15 months have seen steady increases in business, and the money spent on recent agency acquisitions is a reflection of “the strength of travel.” Consolidation means larger agencies have greater buying power when dealing with travel suppliers – and that likely translates into better prices and enhanced value and experiences that can be delivered to consumers.

In the luxury travel sector, agency consolidation signifies a merging of “talent pools.” Travel advisors possess a breadth of knowledge and valued contacts that make them tremendous assets to their agency owners as well as their clients. This talent is the foundation of a strong and thriving agency group and is what breeds future prosperity for these mergers.

Consolidation is not just about large groups joining forces. There is potential for small and mid-size agency groups to come together to strengthen their negotiating position and bolster their market presence.

Relationships Reign Supreme
Strong relationships between buyers and suppliers are more important than ever before as consolidation continues (and it will). These relationships are distinct pathways to long-term prosperity and they are as vital to suppliers’ success as delivering on their brand promise to consumers.

Suppliers’ consumer marketing efforts already represent a multi-faceted approach through print, broadcast, digital and mobile platforms so their programs with travel partners should follow suit. This is the right time to challenge ourselves to become creative and think “out of the box” with our travel industry partnerships to encourage loyalty and boost profit margins.

In Closing
We should remember that customers continue to come first. Whether on the buyer, supplier or marketing side, we all play the role of “curators of travel dreams.” To be a strong travel marketer or travel advisor you have to genuinely believe in the thrilling desire to discover the world – its people, culture and history. And, we must all do our part to sustain the travel business by cultivating travel advisors, motivating and training hospitality and tourism staff, and always striving to exceed expectations and guest satisfaction levels.

As always, I welcome your feedback.

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