Step 5 Developing reading skills

Read an article from the Financial Times and be ready to discuss it.

Travel agents try not to miss internet boat Online Booking Threatens Traditional High Street Outlets

Agent for change: Thomas Cook, the first package holiday organiser, and some early state-of-the-art promotions.

In 1841, Thomas Cook, pioneer of the package holiday, organised an outing by train from Leicester to Loughborough for supporters of temperance in Victorian England. He advertised the trip, dispatched invitations and sold the tickets.

Today Thomas Cook, the UK-based, German-owned travel agency that bears his name, faces a technological revolution that threatens to sweep it and many other agents away. Wider use of the Internet through interactive television is expected to lead to rapid growth of online bookings. This, at least theoretically, could eliminate the role of the travel agent altogether.

‘Users can bypass the travel agent and book direct from suppliers,’ says Barrie Barnes of Philips Electronics, manufacturing set-top boxes, allowing access to the Internet via television.

Unlike banking and insurance services, direct sales of holidays have been slow to take off. But, although few family holidays are booked over the phone or through the Internet, agents acknowledge this is likely to change swiftly once interactive television is fully developed.

Customers will be able to see film footage of destinations, ask questions and make bookings using remote controls.

Date monitor, the management consultancy, forecasts that the value of (ravel booked online in the UK will increase to more than £1 bn within five years. New technology, once established, could quickly drive a fifth of (ravel agents out of business, according to the Geneva-based International Labour Organisation.

Like all middlemen, travel agents are vulnerable to being squeezed out once direct contact is established between suppliers - such as airlines and hotels ~ and the customer.

Airlines in particular are looking to cut distribution costs. In the US, they have moved to reduce the commission they pay to travel agents - a trend (hat is spreading to Europe.

But agents say they will not become helpless victims of the transformation. The Internet will change the way they do business, they admit, but it will not make them redundant.

They cannot, however, rely on holidaymakers continuing to go to their shops to book holidays. Thomas Cook says that customers are demanding more convenient ways of booking. Like other agents, it is doing business by selling holidays in shops and by telephone. It also plans to sell holidays and flights on the Internet - the first UK travel agent to do so.

Providing a variety of distribution channels is expensive in the short term but agents say they cannot afford to do otherwise.

However, they believe that the technological revolution will be in telephone sales rather than Internet sales, and that online technology will rarely be used for booking anything more complicated than an airline or train ticket.

‘The vast majority of customers [only] want to search [on the Internet],’ says Mark McCafferty, managing director of Thomas Cook travel. ‘And as soon as you are searching, there is potential for the travel agent to provide added-value-services.’ Airtours, the UK’s second largest package holiday group, agrees. The Internet will be used by holidaymakers as an electronic brochure and is likely to replace holiday brochures altogether. But when it comes to booking a holiday, customers will still want to talk directly to an agent, it argues.

The Internet will spur an explosion of telephone sales says Going Places, the travel agency arm of Airtours. It has recently doubled its telesales division in preparation for the change.

Thomson, the UK’s largest package holiday company, has aggressive expansion plans for Portland, its direct sales arm, which is the largest direct sales holiday operation with 2 per cent of the market. Thomas Cook says its direct sales have come out of nowhere to account for 10 per cent of its sales in three years.

Ian Reynolds, chief executive of the Association of British Travel Agents, believes new technology could put a premium on specialised advice and tailor-made holidays, enabling agents to charge for these services.

Charging for advice would not necessarily push up the overall cost to the holidaymaker as long as airlines used the savings made from reducing distribution costs to cut airfares.

‘The way holidays are sold will change more in the next five years than in the past 15,’ says Richard Carrick, marketing director of Airtours. ‘The industry is in a state of enormous flux.’

Notes:

an outing - поездка

online bookings - заказ турпоездки через сеть Интернет

set-top boxes - компьютерная приставка к телевизору

middlemen - посредники

to be vulnerable to - быть уязвимым перед...

to make redundant - сделать (кого-л./что-л.) излишним; ненужным; сократить (за ненадобностью)

to hedge -защищать от риска, ограждать от чего-л.

to spur an explosion of telephone sales - зд. привести к огромному скачку продаж по телефону

tailor-made holidays -г тур, сделанный по индивидуальному заказу

Task 1. Find in the article answers to the questions.

1. How did Thomas Cook, one of the biggest travel agencies today, start?

2. What kind of revolution does it face? Why?

What are the forecasts for the growth of online bookings?

3. Why are travel agents vulnerable to these changes?

4. How are travel agents responding to such a situation?

5. What is their view of the technological ,revolution?

6. What economic measures are they planning to introduce to cope with the situation?

Task 3. Comment on the following issues.

1. In what way is modem technology influencing tourist business in Russia?

2. Are online bookings developing fast in this country? Why (not)?

3. What is your attitude to modem technologies?

4. How do you view the future prospects for tourist business in Russia?

5. What is the best way to use computers in travel agencies?

6. What are the advantages and disadvantages of modem technologies in tourist business?

7. What new developments would you like to be introduced in tourism?