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The Once and Future Agent: Travel Agency Distribution Landscape 2009-2013
Report | Published: March 2012
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  • Summary
  • Contents
  • Methodology

Publication Summary

Traditional travel agents once represented the dominant channel through which consumers purchased travel. In the past decade, however, fundamental shifts in consumer behavior and growth in online booking channels have disrupted and transformed the traditional travel agency landscape. The number of leisure agents has declined dramatically, while both corporate and leisure agencies have shifted their focus in order to stay relevant and competitive.

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Douglas Quinby, Senior Director, Research


The Once and Future Agent: PhoCusWright's Travel Agency Distribution Landscape 2009-2013 examines the traditional travel agency channel, assessing the state of the marketplace and providing a detailed outlook for the future. Drawing on data acquired through a survey of more than 1,200 U.S. travel agents, supplier interviews, publicly available financial information and a range of third-party sources, this report identifies the key forces shaping agency distribution and examines the complex dynamics at play in both the leisure and corporate agency markets. The Once and Future Agent: PhoCusWright's Travel Agency Distribution Landscape 2009-2013 includes:

  • Comprehensive travel agency market sizing, including leisure versus corporate sales, and sales by segment – air, hotel, cruise, car, tour and rail
  • Composition and structure of the travel agency marketplace, examining the total number of agency locations, the travel agent population, the mix of leisure and corporate agencies and travel agency affiliations (consortia)
  • Assessment of the growing home-based travel agent phenomenon
  • Detailed analysis of travel agency research and booking methods, including GDSs, mobile devices, supplier websites and other online resources and platforms
  • Discussion of trends and key market developments in the U.S. travel agency landscape, such as:
    • Overall outlook for leisure and corporate segments in the aftermath of the recession
    • Significant shifts in the mix of travel products that leisure agents offer their clients
    • Evolution of a new breed of travel agent in response to changes in technology, consumer behavior and business practices that have become outmoded
    • Examination of key threats to the leisure agency distribution channel, including risk of declining supplier commissions and aging travel agent population
The travel agent marketplace has changed radically over the past 15 years, in both the corporate and leisure segments. The Once and Future Agent: PhoCusWright's Travel Agency Distribution Landscape 2009-2013 outlines this transformation and projects what lies ahead for traditional travel agencies.

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Table of Contents

50 Pages

Introduction & Executive Summary
Key Findings
Research Methods & Terminology
Travel Agents Today: Key Terms and Definitions

Size of the Market
Agency Sales
Leisure vs. Corporate
Agency Sales and Share by Segment

Structure of the Market
Leisure and Corporate Agencies
Travel Agent Population
Home-based Agents
Consortia & Agency Affiliation

How Travel Agents Book
Research & Shopping
Complex Leisure: Cruise & Packaged Travel

The Once & Future Agent: Key Market Developments
An Uneven Outlook
Cruise: Agents' Double-Edged Sword
Leisure: Getting Less Complex
A New Breed of Agent
Hey, Big Spender: The Travel Agent Customer
Age and the Future of the Leisure Agent Profession
Mobile Void

Partners & Sponsors

LIST OF TABLES

Total U.S. Travel Market and Travel Agency Sales, Share and Annual Change, 2008-2013

U.S. Travel Agency Annual Change in Sales by Sector (Leisure/Corporate), 2009-2013

Composition of U.S. Travel Agency Gross Sales by Segment Share, 2011

Product Mix by Agency Type

Travel Agency Market Share of Gross Sales by Segment, 2009 and 2013

ARC and IATAN Retail Agency Locations, 2007-2011

Travel Agency Locations by Data Source, 2011

Agency Locations by Agency Type, 2011

Leisure and Corporate Agencies by Annual Sales of $5M

Travel Agent Population Segments and Projected Gross Sales

Percentage of Independent and Affiliated HBAs, 2011

Agency Group Affiliations, 2011

Typical Shopping Sources: Leisure RSs and HBAs

Typical Channels for Air Booking

Typical Channels for Hotel Booking

Booking Channels for Cruise, 2007 and 2011

Booking Channels for Packages (excluding escorted tours and FIT)

Shifts in Product Mix, 2007 and 2011, by Agency Type 32

Average ARC Transaction Value by Agency Segment, 2010

Leisure Retail Storefront Agents by Age and Experience, 2007 vs. 2011

Methodology

Travel Agency Gross Sales Volume
PhoCusWright sized travel agency sales using the supply-side methodology it developed through PhoCusWright's U.S. Online Travel Overview Eleventh Edition (November 2011). This methodology bases its market sizing on supplier revenues. Data is acquired through supplier interviews, publicly available financial information, and other credible thirdparty sources, including Airlines Reporting Corporation (ARC), Cruise Lines International Association (CLIA), National Tour Association (NTA), PricewaterhouseCoopers, STR Global (formerly Smith Travel Research), PKF Consulting, and select travel industry trade publications and surveys (e.g. Auto Rental News, Business Travel News, Travel Weekly).

Travel agency market sizing figures represent gross bookings of flights, hotel, car rental, tour operators, cruise lines and rail purchased via travel agencies in the U.S. The sizing includes leisure, corporate and unmanaged business travel. Sizing figures represent gross bookings, not travel agency revenues. Online travel agencies (Expedia, Orbitz, Priceline, Travelocity and their portfolio of websites) are excluded from this segment.

Travel Agency Survey
PhoCusWright conducted a web-based survey to capture profile information (e.g., demographics, sales volume) and research and booking behavior among a representative cross-section of U.S. travel agents. PhoCusWright completed the survey in July and August of 2011 and received 1,203 qualified respondents. The survey was fielded in partnership with five major travel industry organizations to ensure a response base representative of the total travel agency community.

Project partners who provided travel agency lists for the survey:


  • Association of Corporate Travel Executives (ACTE)

  • Airlines Reporting Corporation (ARC)

  • American Society of Travel Agents (ASTA)

  • Cruise Lines International Association (CLIA)

  • Travalliance (publishers of Agent@Home, Vacation Agent and TravelPulse Daily)



In addition, PhoCusWright conducted 40 interviews across the agency landscape to acquire a richer perspective from frontline travel agents, agency owner/managers and executives from agency consortia, suppliers, and technology firms.

Leisure/Corporate Segmentation
A key objective of this research was to understand the major differences between leisure and corporate travel agencies - specifically with regard to their commercial models, the products they sell, their booking methods, use of technology, influences on their product selection and recommendation, the composition of their customers, and their marketing practices. The survey asked respondents to indicate the percent of their gross sales volume that is leisure and unmanaged business travel and the percent that is managed (corporate) travel. PhoCusWright segmented the respondents according to the following criteria:

  • eisure: At least 70% of gross sales volume is leisure

  • Corporate: At least 60% of gross sales volume is managed corporate travel

  • General purpose: All remaining agents where leisure volume represents less than 70% of total sales and corporate volume represents less than 60%