Are OTAs Creating Opportunities for Conventional Agencies?

Jul 15, 2019

There is growing dissatisfaction among hospitality-goers, according to a report launched by IBM, Travel 2020: The Distribution Dilemma, which may turn out to benefit resorts and hotels offering direct online bookings. One primary reason cited in the report, which surveyed more than 2,000 travelers, is OTAs (Online Travel Agencies) placing too much focus on low prices rather than value.

For consumers focused solely on getting the best price, the advent of OTAs has been a welcomed shift. For others, this comes at the cost of travelers doing the bulk of the groundwork when booking their travel, and yet another contributing factor for the waning satisfaction. It’s research that could otherwise be done by travel agents, if not OTAs.

Given the growing complexity of trip planning; with more options and destinations than ever; and discerning consumers who seek customized itineraries for their holidays; OTAs are losing favor, clearing the way for traditional travel agencies to grab some market share. In keeping with much of the shift observed throughout the hospitality sector, traditional agencies must also make the transition from being merely order-taker agents, and instead position themselves as travel curators with personalized customer service. Several traditional agencies have come to differentiate themselves as “traveler advocates,” acting on behalf of clients. They establish their value by extending personal accountability. A benefit that today isn’t found using OTAs.

While there may be market opportunities for travel agents, they must be ready to face off against giants like Google, which are quickly gaining ground in the online travel sales space. In addition, hoteliers are investing in boosting their websites to increase direct bookings and reduce commissions costs.

The adoption of technology for automation is important, but as the study explains, the balance between automation and traveler personalization must be struck to achieve long-term customer satisfaction. Travelers will always be looking for personalized service, even as many of those services may eventually become automated.

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