Among the most relevant issues these days — in every sector — is determining to what extent new technologies should supplant traditional practices, e.g., online credibility (AirBnb, HomeAway) vs. offline credibility (traditional hotels), searchable real estate listings (Trulia) vs. traditional brokers. In the booking of corporate travel, however, the general consensus seems to be that Internet technology reduces overall spend, but at what invisible costs?
Technology Cuts Spend For Corporate Travelers
Amadeus, a technology firm, revealed the findings of a survey last week, indicating that for corporate travelers, the most efficient strategy for cutting spend is the implementation of self-booking tools.
Eric Holenka, Amadeus’ head of global sales for corporations, on self-booking tools:
“The implementation of self-booking tools will help drive bookings online which can lead to a 50-60 per cent reduction in service fees. But that’s only a small part of the overall spend.
“Through effective implementation, you can target air and hotel booking spend – this is where the big savings can be made.
“Corporates should focus on simple bookings and try to bring them online – the adoption of self-booking tools is key to this process” (Gill, 2012).
This interpretation of the data is more confirmative of what most already assumed to be true than it is revelatory, but it’s curious that travel agencies aren’t more outspoken in protest of such data which seemingly obviates the utility of their services. In the real estate sector, for instance, we’re finding that brokerage firms are increasingly hostile to any notion that technology makes shopping for real estate more efficient, with many brokers actively speaking out against new technologies.
Jim Abbott, president and managing broker of ARG Abbott Realty Group, recently uploaded a video to YouTube urging real estate buyers, sellers, and brokers to abstain from using real estate search engines (such as Trulia) — which has created a flurry of controversy on the Internet.
The Value of the Human Agent
But while many travel agencies have gone under in the past 10 years, many are still bullish about the demand for the traditional travel agency industry.
Chris Chiames, spokesman for the third-largest online travel company, Orbitz Worldwide, told USAToday in 2011 (in response to a statement made by President Barack Obama) that travel agencies will always be needed:
“[The death of traditional travel agencies] simply did not happen and will not as long (as) travel agents provide customer value and support … whether it be finding the best airfares or the right hotel recommendations, the customer support in a travel emergency or the back-office support to properly manage travel costs” (Jones).
Henry Harteveldt, former principal airline and travel analyst at Forrester Research, asserts that travel agencies are valued even by corporate travelers:
“For corporate trekkers, whose trips may involve several stops and must adhere to company policies on everything from preferred carriers to what justifies first-class travel, traditional agents play a vital role.
“Travel management companies continue to process the bulk of business travel air reservations. Airlines and hotels still see the majority of their corporate travel reservations coming through the traditional agency channel” (Jones, 2011).
Mr. Chiames and Mr. Harteveldt were responding to a statement made by President Barack Obama about the depersonalization and automation of every industry:
“And one of the challenges in terms of rebuilding our economy, is businesses have gotten so efficient that — when was the last time somebody went to a bank teller instead of using the ATM, or used a travel agent instead of just going online? (Jones, 2011)“
While Mr. Chiamas and Mr. Harteveldt may feel that the President’s statement was hyperbolic, I would argue that the statement was descriptive of an observation the President had made of a very real tendency in our culture — to wit, that people would rather interact with a machine than with another person. Evidentiary of this tendency is the success of retail stores such as Fresh & Easy, a chain of grocery stores in the western United States that has automated cashier machines, which — in part — allows the company to minimize its prices.
Which leads me to my next observation — that while automation does increase efficiency, it makes it difficult for the consumer to obtain assistance from the company, thus cementing the necessity (both now and in the future) of a human agent. Something that I’ve personally experienced — and I’m sure many of you reading this have experienced this as well — is the exasperation of navigating an automated telephonic system for, say, a university, attempting to be connected with a human representative: spending 20 minutes clicking through incomprehensible menus, eventually ending up at the menu you started on; or to have your call dropped completely because of a “dead end.” I assume that this is intentionally placed by the university to screen out those for who it isn’t an “imperative” need to speak with a human being.
Lest I digress, it looks like do-it-yourself booking tools will eventually become the standard, but it is doubtful that this will completely negate the need for travel agents any time soon, especially for complex bookings and customer service:
“The Amadeus survey found that 92 per cent of bookings were ‘easy point-to-point’ journeys which could be made online, while only 8 per cent were ‘complex multi-destination bookings which are more suitable to be managed offline'” (Gill, 2012).
I predict that technology will become more and more pervasive in every sphere of business and personal interaction. For those who haven’t seen it, here’s a funny monologue from comedian Louis CK’s special Hilarious in which he talks about our utter dependency on technology:
Gill, Rob. “Target Flight and Hotel Savings â Amadeus.” Target Flight and Hotel Savings â Amadeus. BuyingBusinessTravel.com, 22 Oct. 2012. Web. 25 Oct. 2012. <http://buyingbusinesstravel.com/news/2217987-target-flights-and-hotels-make-big-savings-–-amadeus>.
Jones, Charisse. “Travel Agents: We’re Doing Very Well, Mr. President.”USATODAY.COM. USAToday.com, 30 Aug. 2011. Web. 25 Oct. 2012. <http://travel.usatoday.com/flights/story/2011-08-29/Travel-agents-Were-doing-very-well-Mr-President/50180084/1>.
Dropped Call. Digital image. Telecom Funda. Telecom Funda, n.d. Web. 25 Oct. 2012. <http://telefunda.blogspot.com/2010/02/dropped-call-due-to-sudden-drop.html>.