Cruising for Customers - An Old-Line Agency Finds an Online Niche

Pity the travel agent. Not only have airlines, been slicing their commissions thinner than the mystery meat on an in-flight sandwich, they’ve also had to contend with an assault from online travel services which gobbled up $11.4 billion of market share in 1999.


While most of the big pre-Internet-era travel agencies have hesitated, Vancouver-based Uniglobe Travel International - the largest single-brand travel agency in the world with 1,100 branches in 20 countries - is pursuing a promising online strategy. Uniglobe is aiming to carve out a lucrative on-line niche by combining a high-tech site with one of the strengths of old-fashioned travel agencies: the human touch.


Uniglobe’s online subsidiary, Uniglobe.com is focusing on one of the old company’s strengths: cruise bookings. Such bookings typically generate 15% to 20% commissions, compared with the 5% to 6% common with air, car, and hotel bookings. Moreover, selecting a cruise involves a broader range of considerations than, say, picking a flight, which many people choose solely on the basis of price. That makes cruises a natural for an old-line travel agency.


Uniglobe’s site does allow you to book other things as well, like airplane trips, hotels, and car rentals. So it has more variety than the site of its global competitor Thomas Cook. Americans can’t buy any kind of travel there. And only in recent months has Uniglobe’s other major rival, American Express, added sophisticated features. That helps explain why e-commerce analyst Gomez.com ranks Uniglobe’s site fourth overall in quality, behind the big online players: Travelocity, Microsoft’s Expedia, and Preview Travel.


But the Uniglobe site outshines all others when it comes to cruises. You can search by region, by destination, or by cruise line. You can check reviews for 70 ships and get deck planes and details such as whether the ship has an Italian restaurant or whether your cabin has a balcony.

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Most important, Uniglobe has a technical capability that none of its competitors have, one that plays to its strengths: an online chat function. If you can’t find the answer to your cruise question, a few keystrokes open a window that lets you chat in real time with one of 75 “cruise travel specialists.” Within seconds, they can answer questions that would normally have you combing fruitlessly through “Frequently Asked Questions” lists on most Web sites. You can also e-mail questions to Uniglobe; a response is promised in 20 minutes. If you’re more traditional and think all this online chat is silly (if that’s so, you probably aren’t attempting to book your travel online in the first place), the company also has a 24-hour help-line.


Uniglobe has been aggressively pursuing partnerships to build its visibility in the U.S. Visa, for example, promotes Uniglobe on its site and is in turn promoted on Uniglobe.com. And How2.com has given over its travel area to Uniglobe. Most important, Uniglobe.com persuaded market leader Expedia to give it a special cruise section within the Expedia site. That, naturally, leads customers to Uniglobe.com. (Uniglobe pays Expedia an unspecified fee for each bookings, that comes through that channel.)


The strategy may be paying off. Though Uniglobe.com’s gross bookings were modest - $47.8 million in 1999 - the company claims its December cruise bookings were up 1,000% from a year ago.


But some analysts believe the profit picture may brighten quickly. Though Uniglobe has only a 5% share of the online cruise market - which still makes it the leader - Forester analyst Henry Harteveldt says Uniglobe “could grab 30% if they are focused and aggressive-”


That sounds good to Uniglobe CEO Martin Charlwood, who says the company will “remain focused on the cruise and tour side of the business because we think it’s got higher margins.” But, he adds, “I don’t want us to be pigeonholed as cruise only, We are a full-service travel Web site.” Uniglobe will take your business any way it can get it.


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