Good prospects for online agents

All the indicators point towards substantial growth for online agents in 2004, but Opodo chief executive, David Scowsill admits that operators will have the majority of the market for some years to come. He told TravelMole: “Customers are becoming more and more comfortable using the internet for travel bookings.” A recent survey of industry experts commissioned by Opodo found that 89% of respondents thought the travel industry as a whole will grow in 2004. 23% singled out online agents as the biggest growth area, with 15% suggesting no-frills airlines, and a further 15% saying tour operators would grow the most. Mr Scowsill said that the UK industry should look to the US to see where it will be in two year’s time. He said: “In the context of European leisure travel about 5% is done online, compared to 19% in the US. We are about two year’s behind the US in terms of development of online travel and we have a long way to go. “The prime driver for online bookings has been low cost carriers. They have spent a huge amount on offline advertising to get people to book online”. He said that other factors, like the uptake of broadband internet in the UK, were also having an effect. He added: “The traditional tour operator model is breaking down because people are more inclined to package their holiday independently. They are walking away from the standard package product. “I am not saying that tour operators will go out of business, this is just a trend. For many years to come the vast majority of people will go with a package holiday. “But when I was at the ABTA Convention in Palma last year I heard a statistic from the Spanish tourist authorities that shocked me. They said that 54% of Brits that visited Spain during the past year had travelled independently.” Another trend identified by Mr Scowsill is that online agents are starting to charge service fees, following in the footsteps off high street agents. He said: “Online agents are starting to charge transaction fees, Opodo included. In the last three or so week, Opodo, Expedia and Lastminute have all brought in transaction charges of about £5.” According to Mr Scowsill, customers have not complained. “There has been no blip, no comment from consumers. “People are used to paying a charge for buying products online. When they buy a theatre ticket online there is an admin fee, and when they buy a flight there are extra charges. People accept the extra fee and they pay it.” He said that the decision to charge the fee was triggered by the airlines cutting commission, which he predicts will soon go from 1% to zero. The report, carried out last month, questioned 230 travel industry representatives including operators, agents, airlines and journalists. Report by Ginny McGrath