Why Are Travel Agents Still a Thing?
The profession is thriving—It just depends on what you define as a travel agent.
Image: Sean Hobson/Flickr
I don't think I know a single person my age who's ever booked a flight, hotel, or car through a travel agent. This is anecdotal, to be fair—there could be those in their mid-20s who recoil at the thought of using a site like Expedia or Hipmunk's mobile app—but I suspect my experience is fairly common. Why ever talk to a human again when booking a trip is just a click or tap away?
And yet, while the brick-and-mortar walk-in travel agency of decades past may be largely extinct, not only do travel agents still very much exist, but the profession itself is thriving. It just depends on what you define as a travel agent, of course.
The upending of the traditional travel agency industry can be pegged to the early 1990s, when airlines started to reduce the commissions they paid to agents on ticket sales—a primary source of revenue—in an effort to cut costs. Things were further exacerbated by the internet, which made it easier for travellers to book flights and hotels by themselves. In 1990, there were about 132,000 travel agents in the US, according to the Bureau of Labour Statistics, but by 2014 that number had been cut nearly in half, to 74,000, and is projected to decline by another 12 percent by 2024.
There's "no question," according to Henry Harteveldt, a travel industry analyst and founder of advisory firm Atmosphere Research Group, that DIY services factor into this decline.
Travel agents continue to exist for the same reason they always have: to do the things that travellers can't or don't know how to do
Nevertheless, travel agents have managed to carve out a niche. For example, some trips are more complex to book than than others, either involving lots of flights, lots of people, or some combination of both. Business travellers may have to book according to corporate policies. Some travellers are overwhelmed by or distrustful of the options they see online. Others are increasingly looking for unique experiences and knowledge that a self-serve site can't provide.
Basically, travel agents continue to exist for the same reason they always have: to do the things that travellers can't or don't know how to do.
Seth Kaplan, an analyst and managing partner at Airline Weekly, says that while the mom-and-pop, brick-and-mortar style shops are few and far between, self-serve websites such as Expedia and Orbitz are actually licensed travel agencies in disguise, and employ many travel agents in call centres. The majority of customers might never speak to those agents, but when something goes wrong, your trip is complex enough that it's hard to manage yourself, or you don't believe you're getting the best deal, that's when customers pick up the phone.
"The reason we have traditional travel agents is travellers want to be travellers," said Harteveldt. "They really don't want to be travel agents." Even with the advent of online services, Atmosphere's research has found that some consumer travellers "feel they're spending too much time planning their trips, that they have to visit too many websites to get all the information they want, that there's an issue with trust and credibility with the information they receive."
In other words, travel agents can cut through the noise—and some even still have relationships that give them access to airline fares that aren't visible online, or rooms in hotels that otherwise appear booked.
Kaplan also points to travel management companies that cater to the "corporate travel community," as another example of where travel agents still thrive. Business travellers may be in the minority of travellers (the US Travel Association says that more than three quarters of domestic trips are for leisure), but they pay more money, and this is a "huge" segment of travel agency business.
"It might look like Delta is cheaper for a consumer to buy, but the company might have a contract where they get big discounts from American [Airlines] in exchange for a lot of volume," Kaplan explained, adding that a corporate travel agent would also be familiar with a particular company's policy: for example, when to book economy versus business class.
But Kaplan, Harteveldt, and others in the industry say specialization is what's really keeping travel agents in business. Rather than trying to be all things to all people, what's driving the industry nowadays are, in Harteveldt's words, "pretty savvy business operators" that are very well versed in specific things.
Susan Ferrell, owner of a US agency called Travel Experts, told Travel Weekly that specialists didn't exist 25 years ago. "Back then, agents did it all. They did not pick a niche; they booked everything," she told the site. Now, it might be expertise in a destination (Japan), type of travel (budget), or type of traveller (elderly). Increasingly, there are boutique agencies that only cater to luxury trips or one-of-a-kind experiences.
If there's one thing each of these specialists still has in common, it's that, according to Travel Weekly's 2015 Consumer Trends report, traditional advisors "continue to attract the consumers who take the most number of trips per year, take the longest trips, and spend the most money per day." In other words: you're less likely to need one for the routine flight home you book once or twice a year, or the occasional vacation to a nearby city. But once your plans start to get more complex—or unique—you can still find a travel agent waiting to take your call.
We've been predicting the death of travel agencies since basically the birth of the internet. While generalists have significantly declined, specialists have just cropped up to take their place, and there's no indication those jobs are going anywhere. The internet may have hastened the profession's decline, but until the creation of a travel AI, there are still some things computers can't do.
Why Is This Still a Thing is a column exploring the anachronistic, seemingly-outdated technology that surrounds us. New columns appear every Friday.
Update, March 19: An earlier version of this article stated that "If you can afford to jetset around the world on multiple trips a year, you can afford to pay someone to book those trips for you," which implied that it costs money to use a travel agent. Rather, while many agents do charge fees—especially when personalized research and consultation is involved—many do not, and so we've removed this line from the story to make things clearer.