8.2 Role of travel intermediaries and aggregators

Travel intermediaries and aggregators play a crucial role in connecting suppliers with consumers. They act as middlemen, offering services like booking flights and hotels, while also managing supplier relationships and ensuring smooth customer experiences. These platforms have revolutionized how we plan and book travel.

Intermediaries and aggregators add value through personalized recommendations, specialized expertise, and comprehensive travel information. They've disrupted traditional distribution channels, increased competition, and shifted power dynamics in the industry. This has created both challenges and opportunities for suppliers in balancing control and leveraging data for growth.

Roles of Travel Intermediaries and Aggregators

Connecting Suppliers and Consumers

Top images from around the web for Connecting Suppliers and Consumers

• 

  Channel Structures | Principles of Marketing View original

  Is this image relevant?

• 

  Market Networks, Innovation & Digital Value Chains – Stories of Platform Design View original

  Is this image relevant?

• 

  Distribution Channels | Boundless Business View original

  Is this image relevant?

• 

  Channel Structures | Principles of Marketing View original

  Is this image relevant?

• 

  Market Networks, Innovation & Digital Value Chains – Stories of Platform Design View original

  Is this image relevant?

1 of 3

Top images from around the web for Connecting Suppliers and Consumers

• 

  Channel Structures | Principles of Marketing View original

  Is this image relevant?

• 

  Market Networks, Innovation & Digital Value Chains – Stories of Platform Design View original

  Is this image relevant?

• 

  Distribution Channels | Boundless Business View original

  Is this image relevant?

• 

  Channel Structures | Principles of Marketing View original

  Is this image relevant?

• 

  Market Networks, Innovation & Digital Value Chains – Stories of Platform Design View original

  Is this image relevant?

1 of 3

• Travel intermediaries act as middlemen between travel suppliers (airlines, hotels, car rental companies) and consumers
• Provide services such as booking flights, hotels, car rentals, and vacation packages
• Travel aggregators are online platforms that collect and compare travel information and prices from multiple sources
  • Allow consumers to find the best deals and options in one place (Expedia, Kayak)

Managing Supplier Relationships and Customer Experience

• Intermediaries and aggregators manage relationships with suppliers
  • Negotiate rates and contracts to secure competitive prices and inventory
• Ensure a seamless booking experience for customers
  • Handle customer service, payment processing, and post-booking support
  • Assist with itinerary changes and cancellations
  • Provide travel information and guidance to help customers make informed decisions

Value-Added Services of Intermediaries and Aggregators

Personalized Recommendations and Specialized Expertise

• Offer personalized travel recommendations and curated itineraries
  • Based on customer preferences and past booking history
  • Use data analytics to tailor suggestions to individual needs and interests
• Some intermediaries specialize in niche markets and offer tailored services and expertise
  • Luxury travel (Virtuoso), adventure tourism (Intrepid Travel), corporate travel (American Express Global Business Travel)

Comprehensive Information and Loyalty Programs

• Provide comprehensive travel information to help customers make informed decisions
  • Destination guides, reviews, and ratings
  • Travel tips, advisories, and requirements (visas, vaccinations)
• Offer loyalty programs and exclusive discounts to encourage repeat business and customer loyalty
  • Reward points, early access to deals, personalized promotions
  • Partnerships with airlines, hotels, and credit card companies to offer additional benefits (priority boarding, room upgrades)

Impact on Travel Distribution

Disrupting Traditional Channels and Increasing Competition

• Intermediaries and aggregators have disrupted traditional travel distribution channels
  • Provide consumers with more choice, transparency, and convenience
  • Enable direct booking and comparison shopping, bypassing traditional travel agents
• Increased competition among travel suppliers, putting pressure on prices
  • Forces suppliers to differentiate offerings through unique experiences and value-added services
  • Encourages innovation and customer-centric strategies

Shifting Power Dynamics and Facilitating New Business Models

• Rise of online travel agencies (OTAs) and metasearch engines has shifted power from suppliers to intermediaries
  • Intermediaries control a significant portion of the customer booking journey
  • Can influence supplier visibility, pricing, and inventory allocation
• Facilitated the growth of the sharing economy and alternative accommodations
  • Provide a platform for small suppliers (vacation rentals, peer-to-peer tours) to reach a global audience
  • Enable new business models and revenue streams for suppliers and hosts

Challenges and Opportunities for Suppliers

Balancing Control and Collaboration

• Suppliers face the challenge of maintaining control over brand, pricing, and inventory when working with intermediaries
  • Intermediaries may have conflicting priorities and strategies
  • Commission fees and revenue sharing agreements can eat into profit margins, particularly for small and independent operators
• Building strong relationships with key intermediaries can provide competitive advantages
  • Secure preferential placement, promotions, and partnerships
  • Collaborate on marketing campaigns and customer acquisition strategies

Leveraging Data and Insights for Growth

• Intermediaries and aggregators provide suppliers with access to a larger customer base and increased visibility
  • Can help drive sales and growth, especially for lesser-known or niche suppliers
• Suppliers can leverage data and insights from intermediaries to better understand customer preferences and behavior
  • Develop targeted marketing campaigns and personalized offers
  • Identify trends and opportunities for product development and innovation
• Adapt to changing customer expectations and market dynamics shaped by intermediaries and aggregators
  • Invest in digital capabilities and direct booking channels
  • Focus on differentiation, experiential travel, and sustainable practices