Published: 09 Feb 2009: Online travel booking is on a roll with an estimated 11 percent CAGR in online bookings in Asia Pacific over the next four years, according to Abacus.
Abacus expects this to continue for the foreseeable future as more Asian travellers gain access to the tools to look and book online. In fact, the volume of bookings made by Online Travel Agent´s (OTAs) connected to the Abacus GDS increased by over 20 percent year-on-year.
"We are approaching the turning point where the Internet can no longer be regarded as an emerging channel, but has now earned its place as a key channel in the sales and marketing strategy of all significant players in the industry," Abacus International CEO and president, Robert Bailey said.
While online bookings estimatedly account for around 11 percent of total airline bookings in Asia Pacific (Eye for Travel Asia Pacific Online Travel Report 2007), traditional ´brick and mortar´ travel agents continue to be a major force in travel distribution.
"In all our conversations across our network of over 15,000 travel agency locations we are picking up a strong emphasis on travel agency productivity and a push to reduce costs through greater automation, use of productivity tools etc. 2009 will be the year of the leaner and meaner travel agency," said Bailey.
"Asia will see continuing pressure by the airlines to roll back travel agency commissions; but the progress will be muted, at least for some time, by certain unique characteristics of the Asian market; diverse currencies, visas and the complexity of travel. This was exemplified by the recent experience of India where collective action by travel agents reversed an attempt by several major airlines to cut the commissions."
"Another recent trend in the United States has been the rapid rise of home-based travel agency consultants as mainstream agencies have re-trenched over the past year. We are yet to see this trend in any significant way in Asia; but it is possible that the model gains some traction here over the years ahead as the tools of travel booking become more portable and less tied to the office."
2009 has all the hallmarks of being a watershed year for the Asian travel industry
Abacus believes that many players in Asia´s travel industry will be stress-tested by the conditions the industry will encounter in 2009.
And the winners will be those with underlying capital strength, the smartest and most nimble strategies, and the strongest customer relationships, said Bailey.
"The economic and market issues are more systemic and are impacting on a broader range of players within the travel sector and wider economic environment. On top of this, events such as the airport blockade in Thailand and violence in Mumbai have further disrupted travel patterns at a time when the industry can little afford it," he said.
Tourism arrivals are slipping in many countries in the region. For example, Singapore recorded a 1.6 percent drop year-on-year against 2007 and hotel occupancy rates down by 6 percent for the year in a recent release by Singapore Tourism Board. Malaysia is projecting a 9 percent drop in tourist numbers to 20 million foreign visitors in 2009. Indonesia stands out as something of a beacon for the industry in South East Asia. A resurgent Bali continues to shine amid a 16 percent year-on-year surge for all visitors to the country in what was billed as Visit Indonesia Year.
"2009 will also be a year of concerted action by the National Tourism Offices to get people moving. We expect an intensification of branded national campaigns, combined with tempting discount offers as countries such as Hong Kong, India, Malaysia, Singapore and Thailand battle it out for the tourist dollar," Bailey said.
