Tour group operator’s sales are expected to decline 17 percent this year. So what can they do about it?
“Travel’s traditional packagers have en extra strike against them,” says PhoCusWright.
That is a lack of demographic diversity among their older travelers.
“The tour operator relies overwhelmingly on older travelers, boomers and seniors who represent 77 percent of the average tour operator’s customer mix,” the site says.
Conventional wisdom has it that boomers are the wealthiest generation and avid travelers, but in fact it is this group (45-64 age bracket) that is spending the least per household on travel in 2009. They are also the most likely to reduce travel spend this year, according to PhoCusWright’s Consumer Travel Report.
What to do about it?
“For starters, look online; Generation Y favors online distribution and metasearch when shopping for travel. Until recently, tour operators have been relatively slow to embrace the Internet as an online shopping and selling channel for consumers,” says PhoCusWright.
As a result, tour operator Web site sales are dwarfed by package sales via online travel agencies. Tour operators sold USD$741 million in packages online to consumers in 2008, compared to more than UDD$6 billion in package sales via OTAs, who have increasingly made packaging a cornerstone of their strategy.
Travel packagers with a predominantly consumer-direct distribution strategy should also consider more active engagement with travel agents.
By David Wilkening
