Asia Pacific travel agents missing out on low cost travel

24th Oct 2013
Asia Pacific travel agents missing out on low cost travel

Providing a snapshot of the key issues for online travel agencies in the Asia Pacific region, Abacus is today sharing the findings of its latest polling, revealing travellers in the region are missing out on the benefits of low-cost travel.

This August the region’s leading travel technology provider questioned 62 travel agents invested in the online space on various aspects of their digital businesses and the revenues achieved.

Comprising a mix of agency types, some regional, some traditional or niche, one in five were dedicated almost entirely to online business.

Those more offline tended to fulfill that way, even if the query originated on the net, while those focused on online revenues tended to process the entire transaction digitally.

Flight search served as the primary function of their sites with 82 per cent confirming that they sell air tickets online.

Almost three-quarters offer accommodation and cross-sell other products.

The ability to present competitive fares, including those of low cost carriers, was seen as vital to the offering for most.

But, while 42 per cent of participants acknowledged LCCs as having a ‘major presence’ in their markets, 60 per cent were unable to display and sell their inventory.

Only 29 per cent of the agents have any agreements with budget carriers, the rest either excluded them from their search results or, as one in seven admitted, ‘screen-scrape’ the LCCs’ sites for the sake of content comprehensiveness.

As further evidence of the disparity between supply and demand, almost a third stated “we ignore LCCs and focus on airlines that can be booked through our online booking engine”.

“We cannot assume users of these travel agents’ sites are familiar with all the airlines operating on their chosen routes, or to know where else to look to compare the available fares,” explained Martin Symes, vice president product and marketing, Abacus International.

“An LCC’s absence places the carrier, the intermediary and the consumer at a disadvantage.”

Having bridged the content divide, though it seems other gaps appear.

Where online travel agents are able to book LCCs, the low cost model, with fares often lacking flexibility and the emphasis on ancillary revenue generation, selling and servicing is made more challenging. 

One third of the agents cited a problem with ancillaries in quoting the total price.

“It’s a snapshot of where we are on this important debate,” cautioned Symes.

“In other parts of the world including the US, Europe and Australia, we have witnessed major LCCs work to gain share of the higher yielding corporate market, by evolving their products and GDS participation levels. 

“It will be interesting to see if this is replicated here in Asia.”

“LCCs in this region now have the ability to engage the trade in many different ways, given innovation in the distribution technology.

“They can readily scale a B2B model to complement their direct focus,” he concluded.


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