Can agents satisfy clients and suppliers?

DURING a recent webinar,
‘Preparing Your Travel
Business to Meet
Traveller Trends in 2020’,
organised by Tnooz, Mary Pat
Sullivan, research analyst
at PhoCusWright, raised the
issue, saying travel agents in
the US had shifted their focus
from commission to customer
service.
Customer service has
become their numberone
priority, she says.
Commissions and cash
incentives on the other hand
only feature at the very
bottom of the travel agents’
list of priorities. “This has
really changed in the overall
business models of travel
agents. Twenty years ago
commission wouldn’t have
ranked at the bottom of the
priorities.”
This change in attitude
could have far-reaching
implications for preferred
supplier relations, says
Mary Pat. “The challenge
is now what happens to
these preferred supplier
relationships if the business
model is turned upside
down? If you’re telling your
customer that their customer
service experience is number
one, you’ve got to decide
how you define that preferred
supplier relationship. Can
the consortiums and host
agencies continue to drive
value for their preferred
suppliers?”
However, many in the South
African travel trade sector,
which relies heavily on
preferred agreements, believe
agents can do both – satisfy
clients and suppliers.
Dezy de Lima, product
and marketing manager of
Holiday Tours, says there
is no reason why the travel
agent would not be able to
meet the targets if the tour
operator provides quality and
service.
“Tour operators and
wholesalers should be
providing product based on
trends, which are evident
from what retails agents
are requesting. It all boils
down to three main aspects
– product, price and service
levels. If a supplier is able
to meet these requirements,
there is no reason for the
agent to look for a different
supplier. Therefore, it is
possible to put the customer
first but still push business
through the preferred
supplier.”
John Ridler, spokesperson
of Cullinan Outbound
Tourism, agrees, saying
the travel trade already
puts the customer first as
they are likely to enter into
preferred agreements with
suppliers with products
and service levels that
are compatible with their
clients’ expectations. He
says agents will naturally sell
the products they are most
familiar and comfortable
with, but if a client requests
another product, it would be
dishonest to dissuade them
from their choice, unless
the agent truly believed the
product was inferior.
Otto De Vries, ceo of
Asata, says the association
advocates that agencies are
“agents of the customer and
not of the supplier”. “We see
a focus on the customer as a
win-win for every party. If you
are servicing your customers
properly and they’re happy,
you’ll generate more business
for your agency and for your
suppliers, therefore ensuring
you’ll meet your supplier
targets.”
Otto admits, however, that
if the number of preferred
suppliers a travel agency
focuses on is very small, this
may impact on their ability
to be customer-centric. The
counter argument to this is
that by focusing on a few
suppliers, travel professionals
become experts and can
specialise in what these
suppliers have to offer.
Rachael Penaluna, business
manager for Sure Maritime
Travel in Port Elizabeth,
agrees that successful travel
agencies today already view
client satisfaction as the
number-one priority. “The key
to being able to combine an
offering that is both preferred
and delivers to the client, is
negotiating with products that
are reliable, offer value and
deliver when the chips are
down.”
Rachael says it’s not
difficult to sell preferred
products as long as there is
choice, variety and quality
within the preferred offering.
She adds that supplieragency
agreements are
a valuable and reciprocal
business proposition as they
often offer flexibility and
accessibility that ‘normal’
deals don’t. “Suppliers
should be using agents and
their agreements, to align
themselves in the market,
using feedback as an
additional source to improve
and tweak their offerings,”
she says.
Juan Nel, marketing
manager of Africa Stay,
believes the dynamics of
how the current preferred
agreements work in the
South African market will
change as client satisfaction
is increasingly becoming
the main driving point
when selling holidays. “The
preferred supplier will have to
put less focus on an overall
incentive to the agent and
agency itself and put more
focus on the value of the
product they offer to the end
consumer.”
Juan adds that incentivising
agencies won’t work.
“Suppliers will have to offer
a product to the agent that
makes it easy to sell against
other competitor suppliers,
whether it is on price or on
added value, so that the
consumer ends up with the
best value for money offer.”
This could just play havoc
with existing preferred
supplier relationships, which
often see travel agents
push volume through to
their preferred supplier
regardless of the wishes of
the customer