Research suggests that travellers are changing their safari booking habits by making reservations directly on booking aggregators or directly via the safari lodge or game reserve’s website. So where does this trend leave Tour Operators? Is the traditional travel distribution channel changing from a three-tier level (Customer – Travel Agent – Tour Operator – Supplier) to a one-level (Customer – Supplier) approach? By Des Langkilde.
According to McKinsey & Company, ’Suppliers are making huge investments to lure customers to their direct channels, inadvertently reducing the return on investment (ROI) by lifting costs with little immediate increase in revenue. Online aggregators are not only pushing suppliers out and undermining their one-stop-shop proposition but also digging their heels into a format that emphasises price as the primary product differentiator’. McKinsey suggests that ’Suppliers should shift from a business-to-business, channel-centric approach to a decidedly customer-centric one: the overarching goal [being] to win customers, not to fight a zero-sum game with intermediaries.’
Looking for answers to substantiate McKinsey’s observation, and to establish the role of Tour Operators as a source for safari bookings specifically, I turned to Vernon Wait, Marketing Director of Lalibela Private Game Reserve in South Africa’s malaria-free Eastern Cape province.
“Itineraries to Africa can be complicated and require specialised knowledge. Things can go wrong in Africa and that is when a client needs to be able to go to their travel professional for assistance as opposed to a ‘call centre in the Philippines’ for those who may have booked via other channels,” says Wait.
“While we do not ignore the direct market, tour operators and travel agents remain the single largest source of business to Lalibela and we see no reason why this should not remain so for the foreseeable future.
“This business is all about relationships. A safari property like Lalibela, who thinks long term, would never discard the travel trade simply because, for example, the industry is going through a boom period now and the direct channel might be more lucrative and appealing.
“Lalibela, now under new ownership, is making huge investments in purchasing and rehabilitating additional land, upgrading lodges and WiFi connectivity, and adding more game. We believe very strongly that it is in our interest to build up strong relationships with the trade in the belief that we are there to support each other, through good times and through more challenging times. We will continue to build on existing relationships and to forge new relationships going forward,” Wait concludes.
So, it’s really about relationships, which is where online aggregators lose out. They may provide quick price comparisons but unknown to most travellers, booking through a tour operator can, in fact, cost less, especially when an extended tour itinerary is required.
Tour operators pre-negotiate the best prices and have done the necessary due diligence needed to find the traveller the best deal to suit his or her pocket. Tour operators also have access to specials, exclusive deals, and upgrades, and add the personal touch that is not available through online booking aggregators.
Another important benefit to booking through a tour operator is when there are unforeseen changes that arise before or during a trip. Tour operators have better access to resources and can quickly handle flight delays and change schedules, accommodation reservations, visa issues, and the like without necessarily demanding additional fees.
Consumers more often than not, don’t realise the personalised service offered by tour operators until such time as they need it. Tour operators are available before, during and after the trip, they are on hand 24/7 to provide assistance. This is not always the case when trying to contact your online supplier! On top of which there is no one else to blame if elements of the travel itinerary are disappointing – there is no agency to blame or help to solve problems.
For consumers, booking aggregators have made it easier to research and compare travel destination product prices. It’s a fact that every year the number and proportion of aggregator and OTA bookings rise. Whilst there are perhaps compelling reasons to book a city break in a first world country online, there are many more factors at play when booking a trip to Africa, so travellers need to consider their motivations carefully.
It’s also a fact that credible tour operators add value to the price proposition by providing buyer reassurance and added value through, for example, financial guarantees. The Southern Africa Tourism Services Association (SATSA) bonding scheme is a good example, whereby deposits held by the tour operator are refunded to the client (or the tour passed to another member to fulfil) in the event of the member’s involuntary liquidation.
Booking Aggregator: An aggregator refers to a website [or meta-search engine] that aggregates specific information from multiple online sources. Aggregators troll the results of booking engines and return the best results [including the hotel’s own website, which often offers specials and deals that the OTA’s can’t match]. Research suggests that while most travellers are still conducting their primary research on an aggregator site, they are increasingly turning to the brand itself once they’re prepared to book.
Online Travel Agent: An online travel agent (OTA) allows travellers to book [flights, holiday packages, hotel rooms, car rentals, train tickets, etc] from a single website. It’s interesting to note that Lalibela Private Game Reserve achieved a rating of 9.5 (out of 10) in the booking.com Guest Review Awards for 2016.