Agents see direct web sales as biggest threat

London: October 20, 2003 – 73 per cent of travel agents and industry professionals surveyed in a recent Amadeus snap poll stated that they were either concerned or very concerned about the effect that airline and operator direct sales via the internet will have on their business.

Rating four different industry issues on a scale of 1 – 5, with 1 being not at all concerned, 3 being neutral and 5 being very concerned, the effect of internet direct sales was of key concern closely followed by the move by airlines towards 1 per cent commission rates with 70 per cent of respondents stating that they were either somewhat concerned or very concerned about this trend.

Commenting on these two issues, one agent stated, “1 per cent commission almost makes it not worth the trouble of being an agent. When airlines and operators direct sell, it takes care of the easy bookings but leaves agents having to resolve the difficult or multiple bookings. This takes time, expertise and energy for which the airlines do not even thank the agents. Then adding insult to injury is the fact that some airlines charge for phoning them about problems caused by the airline which can lead to the booking being a dead loss for the agent.”

However, some agents were more pragmatic regarding changing commission rates. One UK niche agent sees the 1 per cent commission rate as making their lives easier, forecasting that people will either have to be happy to pay a service charge or else go on-line to make the booking themselves.

Somewhat surprisingly, most agents were not particularly concerned about the increasing trend towards charging service fees with only 27 per cent of respondents showing any concern over this issue. Another issue agents were asked about was their level of concern over forward bookings for 2004. Only 20 per cent of respondents expressed any concern over forward bookings for 2004 – which suggests a cautious but more optimistic view amongst agents for next year.

Rob Golledge, Senior Marketing Communications Executive at Amadeus UK, said “These issues affect agents in different ways depending on whether they focus on business or leisure travel and the diversity of respondents’ views reflect this. One of the more positive comments expressed is that now more than ever, travel agents are working for their customers rather than acting as agents for any airline or operator. This is good news for the customer when it comes to receiving independent advice. But it’s bad news for suppliers who are too eager to ditch the agency distribution model – considering the volume of sales that is still being generated through travel agents.”

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Notes to the Editors:

Amadeus Global Travel Distribution (MAD: AMS)

Amadeus is the leading global distribution system (GDS) and technology provider, serving the marketing, sales and distribution needs of the world’s travel and tourism industries.

Its comprehensive GDS data processing centre serves 65,250 travel agency locations and more than 12,600 airline sales offices, which together total more than 290,700 points of sale located in over 200 markets worldwide.

Through the Amadeus GDS, travel agencies and airline offices are able to make bookings with 469 airlines, representing more than 95 per cent of the world’s scheduled airline seats. The system also provides access to 63,540 hotels, 48 car rental companies serving some 24,900 locations, and other provider groups including: ferry; rail; cruise; insurance and tour operators.

Amadeus is a leading application service provider (ASP) to the airline industry.
140 airlines use the Amadeus Sales System in their offices to provide passengers with superior and seamless service at optimal cost.

Amadeus’s new generation of Passenger Service Systems, which include all IT systems associated with inventory management and departure control, will be implemented by British Airways, Qantas and Finnair.

e-Travel, Amadeus’s e-commerce business unit, is global leader in online travel technology and corporate travel management solutions. It powers the Web pages of 887 travel agencies, 255 corporate sites, 18 hotel sites and 139 web sites serving 50 airlines.

Amadeus is headquartered in Madrid, Spain and quoted on the Madrid, Paris and Frankfurt stock exchanges. For the year ended 31 December 2002, the company reported revenues of EUR 1856m and net income of EUR 148.6m. The Amadeus data centre is in Erding (near Munich), Germany and its principal development offices are located in Sophia Antipolis (near Nice), France. The company has some 5,100 employees worldwide.

For more information please contact:

Amadeus UK
Rob Golledge
T: 0870 990 7851
F: 0870 990 9299
E: [email protected]
W: www.uk.amadeus.com

Amadeus Press
Bridget Agnew / Anya Velzeboer
Financial Dynamics
T: 020 7269 7219/7174
F: 020 7831 8438
E: [email protected]