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Transcript of Presentation on Travel Agent Roadmap by · Presentation on Travel Agent Roadmap by ... ^The why,...
Presentation on Travel Agent Roadmap by
Ms Karen Ann Leong Deputy Director, Tour & Industry Development, STB
Mr Ang Eu Khoon
Chairman, Information Technology Committee, NATAS
Ms Fiona Lim Chairman, Manpower & Training Committee, NATAS
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Source: Deloitte, Travel Consumer 2015: Engaging the Empowered Holidaymaker
The digital revolution has changed the way consumers shop for vacations
Consumers are empowered by the ability to browse and compare travel products, and the power to share experiences and influence others
7 Source: Deloitte, Travel Consumer 2015: Engaging the Empowered Holidaymaker / Statista, Digital travel sales worldwide from 2014 to 2019 / Forbes, “Are OTAs Really Killing Brick And Mortar Travel Agencies?” 2015
Travel has changed from a seller’s to a buyer’s market
59% of holidaymakers turn to review websites and online forums Only 12% visit a travel agent shop
Digital travel sales worldwide are expected to grow at 10% from 2014 to 2019
Need full reference
In Western Europe Number of trips
booked with a travel agent declined from
one-third to one-fifth from 2008 to 2012
9 Source: Peak + Skift, The Rise of Experiential Travel, 2014
Mainstream is no longer enough.
“Globalisation and technology have led to the homogenisation of cities, which has resulted in travelers craving locally made and authentic experiences.” - Jamie Wong, Founder/CEO of Vayable
10 Source: Peak + Skift, The Rise of Experiential Travel, 2014
Experiential travel - the idea of more immersive, local, adventurous and/or active travel.
Across all age groups, from Millennials to Gen X to Babyboomers, 34% of American Express travel counsellors (agents) share that their customers are “specifically looking to immerse themselves in the destinations and to travel like a local.”
12 Source: Tnooz, “The why, what and when of personalisation and ancillaries in travel”, 2016 / Amadeus + Skift, “5 Reasons Why You Can’t Ignore Personalization in Travel”, 2014
Consumers expect to be
treated as individuals
69% of UK consumers think it is important to receive travel options catered to their personal travel history and preferences
Four out of 10 travellers are willing to share data in the interest of personalisation
13 Source: Adobe, “The Personalisation Payoff: The ROI of Getting Personal”, 2014
Personalisation helps shift the
customer’s focus from purely price to real
value
Nearly nine in ten consumers say that personalisation has some impact on their purchasing decisions.
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How has travel transformed?
1. The Consumer Journey Is Increasingly Digital
2. Consumers Increasingly Demand Experiential Travel 3. Consumers Expect Personalisation
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What we have heard from you
Source: STB Manpower Study of Travel Agent Industry, 2015 / STB Technology Audit of the Travel Agent Industry, 2015
Business Challenges • Competition from OTAs • Suppliers going direct • Consumers expecting more
Weaker economic outlook will see slower traffic growth to and from Singapore. Expectations for future inbound and outbound growth capped at 4%. The number of inbound visitors to Singapore on free and easy or packaged tours grew less than 2% in 2014. Disintermediation is also affecting travel agents as more consumers and suppliers choose to bypass them.
Manpower • Difficulty hiring • Poor perception of sector • High turn-over • Poorly trained staff
Decrease in manpower supply nationwide will mean fewer job seekers. Growth is capped at 2% till 2020. There is job mismatch as industry provides fewer PME jobs which are sought after by Singaporeans. The travel agent industry reported fewer than 40% PME jobs in 2014.
Technology • Lack knowledge • Lack financial resources • Lack in-house IT team • Lack support from staff
Low technology adoption will affect productivity of travel agents and inhibit their ability to meet the needs of today’s consumers. Only ¼ of travel agents actively plan for technology in their business.
Here are some opportunities to consider
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Travel Agents may seize such opportunities and more,
There are areas where travel agents continue to provide value to consumers
and commit to become Designers of Travel Experience.
Optimising the customer’s time Holiday-makers may spend up to 30 hours researching online before booking a trip. Time-sensitive corporate travellers, families or those on luxury trips with little time for research
Giving exclusive access Offering special experiences that consumers cannot easily get on their own Travellers looking for unique experiences which are not widely available
Providing expert advice and care Special itineraries, visas and aid in contingencies Travellers on speciality trips such as mountain-climbing, or those travelling with young children and seniors
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Travel agents can be
Designers of Travel Experience Experts that consumers turn to in the curation of their travel
A workforce that is professional, creative and always up-to-date
A high-value economic contributor and jobs creator
A Roadmap paved through studies and industry engagement
STB’S ROLE
Support Industry Efforts
Facilitate Partnerships
Catalyse First-Movers
• Travel Agents Manpower Study
• Technology Audit
• Engagement with industry leaders
• Deep-dives with NATAS
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Annual Industry Forum
Study Trips and Case Studies
NATAS Business Transformation
Committee
Business Transformation
Playbook Share ideas and engage C-suite leaders in
conversation
BUSINESS TRANSFORMATION
1. Drive Thought-Leadership Sharing 2. Support Business and Job Redesign
Showcase relevant learning experiences
for the industry
Focus on business remodelling
opportunities for the industry
Provide step-by-step guide for change
management
Assistance schemes
Business Improvement Fund
(BIF) from STB
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BUSINESS TRANSFORMATION
Process of Business and Job Redesign
(1) IDEATION AND PLANNING Guidance from ‘playbook’ by consultant – step-by-step guide for travel agents on how to plan the remodelling process
Areas to remodel
Source: Singapore Manufacturing Federation, Business Model Innovation Centre
Lifestyle/Lux
(2) IMPLEMENTATION Funding support by Business Improvement Fund
Examples of remodelling
Examples of travel agents overseas
Carving out a specialty and becoming experts in the field
Using technology and concept stores to inspire travel
Departure Lounge, US • Combines coffee house, wine bar,
event space and travel agency with visual technology and destination-focused foods and beverages
• Over 60 percent of travel business driven by walk-ins who visited to enjoy the F&B
DIgitalisation
Specialisation
MoonRings, US • Positioned as travel specialist on destination weddings • Charges separate fee for planning and
booking services
Technology can build better travel agent businesses
New products
As many as 18% indicate interest
in visiting a travel agent with virtual reality facilities, rising to 27% for those aged 16-24.2
New customers
Companies with omni-channel customer experience management programs gain
6% year over year in average profit
margin per customer. 3
Happier customers,
higher returns
Source: IBM, “Enterprise Resource Planning Systems drive cost reduction and efficiency in Finance and accounting operations”, 2013. / 119% savings is in finance function cost as a % of selling, general & administrative costs / 2Mintel, Travel Agents - UK - December 2015, Interest in Technology / 3Phocuswright, Travel Innovation and Technology Trends, 2015
TECHNOLOGY
Cheaper, better, faster with integrated systems and automation to manage cost Companies with enterprise resource
systems can save 19% more than
companies without.1
Sales Marketing
Product / Suppliers Operations
Accounting Human Resources
Customer
FRONT OFFICE MID OFFICE BACK OFFICE
• Use of accounting and payroll systems are relatively higher (67% and 40%)
• But only 7% use an
enterprise resource planning system
• Less than 30%
have a Customer Relationship Management System
• Only 2% have
customer-facing mobile apps
• Only 20% have a
Content Management System
• Only 15% have an
Inventory Management System
Technology adoption among Singapore’s travel agents has been low
Source: STB Technology Audit of Travel Agent Industry, 2015.
TECHNOLOGY
Most spend less than $50,000 over three years on technology
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For customers who need expert advice and special arrangements…
...how do you equip your team and processes?
TECHNOLOGY
<<Click on image to be directed to video hosted on YouTube>>
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For customers who want that once-in-a-lifetime experience…
...how do you build that deep expertise?
TECHNOLOGY
<<Click on image to be directed to video hosted on YouTube>>
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For customers who are just looking for affordable economical travel…
... how do you do things more productively?
TECHNOLOGY
<<Click on image to be directed to video hosted on YouTube>>
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TECHNOLOGY
e.g. CRM, eCommerce
e.g. front-to-back integration, ops mgmt
e.g. data analytics, visitor experience
1. Encourage Technology Adoption
2. Fund Technology Development
3. Support Innovative Prototypes
Technology Showcase and Guidebook
Showcase relevant technology solutions
for travel agents
Software-as-a-Service Solutions
Aggregate industry demand for shared
service solutions
Matching Services Leverage available services
to help travel agents customise technology solutions
Technology Talks and Experiences
Provide opportunities such as study trips and fireside chats for
C-suite leaders to learn about emerging technologies
for test-bedding Assistance schemes
Business Improvement Fund from STB
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MANPOWER
Travel agents are challenged by manpower needs
% HEADCOUNT SHORTAGE1
What we see in 2020: ~12% manpower shortage in non-management roles which make up more than 50% of TA jobs
Up to 2020: travel agents workforce projected to grow at 2-3%1 while national workforce growth is capped at 1-2%
Travel agents’ manpower needs National supply VERSUS
Source: STB Technology Audit of Travel Agent Industry, 2015. 1Shortage forecasted for 2020 based on optimistic scenario
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MANPOWER
Less than 40% of TA jobs are PME jobs while 2/3 of Singaporeans expect to hold PMET jobs by 2030
Travel agents’ supply of jobs
“… many employees don’t stay long, or
are easily poached”
“it is hard to find staff with the right
skill sets…”
From students: “No point considering a sunset industry like
travel agent…”
National aspirations VERSUS
Travel agents are challenged by manpower needs
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MANPOWER
Source: Malcolm G Patterson et al, Impact of People Management Practices on Business Performance, 2003 / Aon Hewitt, “Measuring the Impact of Employee Selection Systems”, 2012
There are significant upsides to managing manpower well
Good HR practices can positively impact profitability and productivity
Good training of staff can substantially enhance returns
19% 18%
Highly qualified staff produce $24 more sales than marginally
qualified staff per hour
An example from UK’s manufacturing industry
An example from the retail industry: <- Need country
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MANPOWER
Talent Recruitment Strategy
Engage educators and students through
enhanced internships and industry profiling
Curriculum and ‘Work & Learn’
Programme
Offer suite of 29 WSQ courses and flexible working arrangements
HR Excellence
Enhance HR practices through
government resources and
NATAS-led seminars
1. Drive Talent Recruitment
2. Encourage Up-Skilling 3. Enhance Talent Management
Onboarding Materials
Develop plug-and-play materials for
the industry to induct new rank-
and-file hires
Enhanced Accreditation for
Travel Professionals
Recognise skills and professionalism
through personal accreditation
Assistance Schemes Training Industry Professionals in Tourism grant (TIP-iT) by STB for training and HR consultancy
How Can I Embark on the Roadmap? Programmes
Initiate Business Improvement Projects Leverage STB Business Improvement Fund (BIF) for: • Business transformation projects • Technology projects • HR improvement projects
Enroll Your Staff for Up-Skilling • ‘Work & Learn’ Programme • WSQ Tour & Travel Services Courses
Participate in Recruitment Initiatives • Talent recruitment talks and roadshows
Register Your Interest to Attend Events with STB or NATAS
• Technology Showcases • HR Seminars • Study trips
Give Feedback on Upcoming Roadmap Initiatives
• Software-as-a-Service Solutions • Onboarding Materials • Business Transformation ‘Playbook’ • Enhanced Accreditation for Travel Professionals
Begin your transformation today.
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