Cutting Through the Perplexity: Final Thoughts for Travel Agents

by Paul Ruden
Cutting Through the Perplexity: Final Thoughts for Travel Agents

We previously produced two articles outlining some of the most important steps a new travel advisor should take when setting up a travel retailing business.

Those suggestions apply whether the business is a more traditional “brick-and-mortar” storefront or a “do business anywhere” freestyle operation that includes the home office and the local coffee shop or other places where customers can be reached and business can be conducted. Note well that those articles are about establishing a travel business, as distinct from a travel hobby.

As a parenthetical note, if you’re going freestyle, be aware of the Federal Trade Commission’s cooling off rules on sales made away from your office.

The impact of artificial intelligence
My final thoughts about this subject touch on some big and still amorphous ideas that are circulating in the travel industry and that will affect retail advisors more and more as time passes. I refer here to the concept of personalized offers or next-generation airline retailing, as it is sometimes described. These ideas are related to some degree to another big industry concept: the application of artificial Intelligence to the retail sale of travel.

There is, I think, a certain amount of inevitability to the personalized offers concept, because the main players in the airline industry have committed to it and are moving as fast as possible, with help from the GDSs, to use the IATA New Distribution Capability (NDC) to make it happen. This is a matter of staggering complexity for several reasons. One is that NDC, as currently imagined, upends the established arrangements among airlines, GDSs and travel advisors by moving control of booking records to airline computers.

But more importantly for travel advisors, I believe, is the idea that, following a booking query, there is a personalized offer being made that fits the profile of the inquiring traveler. This fit will be determined by data the airlines already have about the traveler, which in some cases, is vast, combined with additional information voluntarily disclosed when the query is made. In the case I care about, the travel advisor will be the facilitator of these disclosures on behalf of the traveler.

Computers will then decide, using artificial intelligence, the specifics of the offer to be delivered to the traveler based on the traveler’s data possessed by the offering airline. The travel advisor will then have the task of explaining and translating the offer to the consumer. How this will be accomplished remains to be seen. It seems inevitable that this process will be even more complex than explaining and translating travel options already is, because, among other things, neither the advisor nor the prospective traveler will know, or have the means to find out, what information was used, and how it was manipulated, to produce the personalized offer. This, I suspect, will place the travel advisor in an awkward position in relation to the traveler, a position the advisor must be prepared to address forthrightly or risk fatal loss of trust by the consumer.

One saving grace may be that the settlement reached during the DOT final approval of the NDC resolutions provides that the existing published prices regime for airfares will remain in place parallel to the regime created through NDC. If that state of affairs remains true in the future (it may well not) consumers, I believe, will quickly learn to demand both types of offers, along with the help of the travel advisor to explain how and why they differ.

Complexity bodes well for agents
On its face, this looks like a situation fraught with problems. The future will tell the tale on that. But one thing we know is that product complexity usually works to the advantage of expert travel advisors. The more complexity, the more the services of expert helpers tend to be valued. At the same time, for the advisors, this scenario raises questions of how to set fees when the booking process has many new elements that may add to the time required to satisfy the traveler’s desire to understand. This, in turn, leads to frustration for many consumers, for reasons explained in, among others, Barry Schwartz’s book, “The Paradox of Choice.” Schwartz explains in compelling fashion why having more choices can lead to dissatisfaction on the part of the consumer.

As we move into this new world, travel advisors must think deeply about how they will deal with the parallel universes of NDC-enabled personalized offers and published prices that consumers are accustomed to seeing.

Use a mediation clause
This brings me to my final suggestion for travel advisors: In all terms of service or other agreements with consumers regarding the advisor’s services, it is desirable to include a requirement to mediate before commencing litigation. While questions linger about the enforceability of agreements to mediate, the mere presence of the clause may help persuade clients that, in the rare case of a serious dispute, there is a way to get professional help from a neutral party without going through the horrors of litigation court. One of the beauties of mediation is that no one can be forced to agree to any outcome he/she considers unfair, so normally there is little risk in trying to resolve a dispute outside the courthouse. I wrote about this some time ago.

As we move toward an even more complex selling environment, I believe mediation clauses can save travel advisors a lot of money and aggravation. You should, of course, consult with agency counsel about how to craft a mediation clause that will be recognized where you do business.

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