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TMCs ‘failing to embrace the web’ – ITM
The majority of Travel Management Companies are failing to make use of the internet to make cost savings for business travellers, according to new research.
A poll of 235 travel managers by the Institute of Travel Management found a number of problems including: increased non-compliance due to the proliferation of low-cost carriers, web-based marketing direct to end users, and the failure of many TMCs to integrate GDS with internet inventory other than airlines.
The research found that although most TMCs now service their clients through a combination of GDS and the web, 46% of buyers are serviced by TMCs without ‘workaround’ technology for anything but air.
ITM executive director Paul Tilstone said: “The internet provides more and better content and rates for hotels, car rental and other travel services, than GDS and yet this is clearly not being offered to buyers by a substantial proportion of TMCs.”
He added: “Most managed travel programmes require the corporate, TMC, distribution systems and suppliers to work in harmony.
“Whilst in general this is very much the case, the massive changes to the distribution chain in recent years can sometimes undermine that harmony.”
Despite the technology revolution that has engulfed travel, some long-standing concerns have not been allayed, the ITM claims.
More than half of respondents believe that the relationship between agent and supplier still has a significant influence on the fares offered to their companies, although the opportunities for an intermediary to influence a purchasing decision was estimated by the ITM buyers panel to be around 40% of all bookings.
Another issue that refuses to go away is that of airline and hotel loyalty schemes. Almost all respondents believe that such schemes still influence booking behaviour, with 90% suggesting that they undermine managed programmes.
Colin Goldney, managing director of of Argate Consulting, ITM’s research partner, said: “Despite all the changes, distribution is still a cost that that any travel supplier will try to reduce or extract maximum incremental value from.”
by Phil Davies
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