In 2005, two-thirds of Australian baby boomers booked their holidays to the Asia Pacific via a travel agency. But just seven years on, this has dropped dramatically. Laura Parr investigates.
(Background voice of check-in call for Virgin Australia at Sydney Airport)
REPORTER: Australian baby boomers are turning their backs on traditional travel agencies in growing numbers. Current statistics from Roy Morgan show that 65 percent travelling to the Asia-Pacific book through airline and accommodation chains directly or online, compared to 45 percent in 2005.
Dr. Nina Mistilis, a senior lecturer in tourism at the University of New South Wales, has also seen this trend in her own research.
NINA MISTILIS: There’s been an increase trend every year at a galloping rate of more people booking online.
REPORTER: She says that the reasoning behind this growth is twofold.
NINA MISTILIS: Firstly, on the travel agent’s part, they now get no or very little commission for booking hotels or airflights, so many of them have closed. And also there’s more websites now, it’s much easier to surf the web so consumers are getting very savvy, very experienced and they can shop around.
REPORTER: Owner of Holidayz.com.au, Jeanette Bamford, says that the online sector is forcing traditional travel agencies out of business, largely because of the cost.
JEANETTE BAMFORD: We used to be an online travel agent ourselves, and it just wasn’t worth the effort. I mean it’s really really hard work. Travel agencies now, I mean they really really struggle because they have the situation where people come in to their bricks and mortar office, and ask them everything – they spend time with them – and then those people just go off and search on the Internet, and say “Oh, I can get it cheaper here…”. And so, it’s just really hard for them and that’s where they’re losing a lot of business so understandably some of them are asking for payment upfront before they do any research, because they don’t want to spend too much time and then find that the audience goes away.
REPORTER: But for travel agent Farid Hacene, travel agencies play an important role in providing personal advice that the online sector does not offer.
FARID HACENE: I think Australia’s a little bit different to other countries. I’ve travelled in the States a fair bit where it’s all online now. The Australian culture likes having someone that they can actually talk to, and we’re seeing the people that we’ve talked to about their holiday as well – so past clients and focus groups that we’ve had – they still enjoy having someone there that actually gives them advice of where to stay. So really online, you have almost too much choice and you’re never 100 percent sure that it’s really quite the right thing.
REPORTER: Dr Nina Mistilis says the survival of travel agencies relies on their ability to target niche markets.
NINA MISTILIS: A lot of agents have reinvented themselves and survived, but a lot have gone under too.
They’ve reinvented themselves by deciding what their market is, looking at their customers, segmenting their markets and then getting better deals for those markets.
REPORTER: Vicky Gonda, General Manager of Jetset Travel Rose Bay, sees her niche market for baby boomers as the bucket list.
VICKY GONDA: …the bucket list? Very much. In fact I subscribed to Get Up & Go, which is a magazine for retirees, and I share that with my friends on Facebook who are all fellow baby boomers, and all of it is bucket list. Everything is bucket list. And that’s what the Virtuoso product is about. It’s bucket list. It’s seeing those places… I’ve got my books there – Thousand Places to See Before you Die – that’s what you’ve got to do. Because that’s what you’ve got here, you’ve got your memories. And that’s what we’re all about, that’s basically my niche, if I was going to talk about a niche – it’s how to maximise those years now. Because I can relate to it so much personally myself. They’re the things I want to do as well.
REPORTER: She believes that the responsibility of catering for this niche means it’s not something that can be done merely online.
VICKY GONDA: They had the bucket list in their mind and in the next… “Well, I’m in my 50s, I’ve got about 10 years of travel, 10 to 15 years of healthy hopefully years, and this is what I’m going to do. I’m going to Kimberleys later in my life.” So we’re actually planning their lives, to an extent.
REPORTER: While Ms Gonda hope there will always be a place for the personal touch of travel agencies, Mr Hacene sees the future as a mix of bookings through both travel agencies and online.
FARID HACENE: It’s an interesting time at the moment because it’s going to be a real hybrid of how people book travel, and most people are still really working out where they fit in and the successful companies will be those that have a combination of those options. It’ll be a mix, rather than online versus travel agent.
REPORTER: This is Laura Parr, reporting for Baby Zoomers.