Category: The travel industry

Introduction of Dynamic Packaging Technology

Expedia, the first online service provider, was founded in the U.S. in 1996; and started to offer flight, hotel and transfer service over internet. However, the sales boom was reached upon the introduction of dynamic packaging technology. The company, today, continue its operations over 30 countries.

Dynamic packaging helps online tour operators, travel management companies and other traditional travel companies to sell online. Airlines, hotels and tour operators benefit greatly from dynamic packaging technology.

In our contemporary world, internet has been an essential part of our daily life. Internet has also proven itself within the tourism industry recently. The latest development of the internet application in the tourism industry is dynamic packaging applications. The dynamic packaging application which presents opportunity to travel agencies to supply various holiday packages to the consumers in real time provides a competitive advantage. Today, consumers’ demand have changed.

They prefer preparing their own holiday packages to purchasing predetermined holiday packages because they want more personal holidays and think that current pre-determined packages are not flexible enough .More consumers require more individualized, flexible and selectable holiday programs and discover travel products of the online world. One of the arms of the semantic web can be found in the tourism industry as dynamic packaging applications.

Dynamic packaging is one of the most important innovations of online travel agencies. The application was first started by the Expedia; and today it is adopted and applied by many online travel agencies. Dynamic packaging provides consumers to reach multiple services with a single search. Thus, consumers can get lower price than they purchase each independent component individually. At the same time dynamic packaging provides suppliers to hide their discount rates. When we look at the customization feature, there are some customization options in three web sites.

Customers can determine destination or multiple destinations, departure and return dates, departure and return times, non-stop or refundable flights, round trip or one way trip in Expedia. In Travelocity, customers can determine destination, round trip or one way trip, departure and return dates, departure and return times, class of flight and airline alternatives. Customers can also determine destination, departure and return dates, departure and return times, non-stop flights and hotel name in Orbitz.com In today’s world where consumers are far more educated than they were several years ago, the travel industry’s future lies in a customer-driven mix of packages, individual products and self-organized travel. In the last few years, the travel industry has been buzzing with a sizzling new phrase “Dynamic Packaging”. Dynamic packaging helps provide a single, fully priced travel package that hides the price of the individual travel components.

It helps airlines, online travel agencies and tour operators to tap into different supplier systems in real time and bundle travel components (air, hotel, car, entertainment) into a single reservation. This is a seamless process which allows the user to choose from a huge range of travel and associated products from multiple vendors. A rules engine is used to configure and manage the different travel products that can be bundled and priced. These technological developments and changing consumer demands have brought several innovations in the travel industry.

One of these innovations is dynamic packaging application. By means of dynamic packaging application, travel agencies can offer real-time, customized, flexible and secure travel alternatives. On the other side,  consumers are able to plan their travels and to make reservation through dynamic packaging applications. Heterogonous data regarding holiday can be gathered through dynamic packaging application so the consumers’ private needs can be meet. Worldwide, it is possible to talk about existence of travel agencies which apply dynamic packaging system. In this Article, Expedia.com, Travelocity.com and Orbitz.com travel agencies’ dynamic packaging applications were investigated. In dynamic packaging applications, choice, customization, flexibility, security and real time features must be found. These characteristics are the main specifications of the dynamic packaging applications distinct from traditional travel packages. As tour operators and vacation packagers continue to understand the value of implementing dynamic packaging technology, travel consumers are reaping the benefits. Travel consumers can now opt to customize vacations rather than accepting pre-packaged alternatives. Empowered travel consumers are exercising more control over their vacations. Dynamic packaging is thus, the most cost effective way for travel distributors to package, distribute and sell vacation products today.

What does a Travel Agent do? How Travel Agencies plays a great role to develop tourism in any country?

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Travel is an extremely diverse and complex industry. The travel industry is comprised of over a dozen related industries: airlines, restaurants, hotels/motels, travel agencies, gift shops, auto rentals, and a host of other businesses that may not be even recognized their dependence on travel and tourism since travelers are usually indistinguishable from local customers. Travel industry is a service-oriented industry.

Logo Airbus.com

It provides people with services such as transportation, lodging, dining, amusements, recreation, travel planning and retail. Travel agencies exist primarily as intermediaries between suppliers of travel services , such as airlines and hotels, and customers. Unlike distributors in many industries, travel agencies do not deal with physical products but with information. Travel agent is defined as a person who undertakes a job for another person, who is the ‘principal’. The principal in such a relationship not only sets the goals of the job, such as selling tickets, but may also control the means and manner in which the job is done.  A current overview of the industry, including the changing trends of travelers, was required by the organization, with a specific request to source existing available data with regard to industry trends for travelers in seeking, booking and purchasing travel.

Logo Expedia.com

It was understood from the outset that data may not exist to answer all the desired needs and, hence, the scoping study would help to confirm the need for future primary research, as well as the parameters and dimensions of that research. This article describes the key findings of the scoping phase. The overall market with regard to the Travel Agency Service Industry in India includes direct selling by travel agencies (retailers and wholesalers), online travel agencies, online wholesalers/consolidators, airlines, tour operators and other ground content (accommodation, attractions, event and show tickets, car hire etc.) operators. Internet travel reservations and bookings include transport (plane, ship, rental cars etc.), accommodation (hotels, motels, serviced apartments etc.), tourist attractions (theme, amusement parks, museums etc.) and bookings made for business, personal and/or leisure purposes. It was the intention in this study that internet travel reservations and bookings would exclude travel agent websites; however, the secondary research drawn on did not always clarify whether usage of the internet excluded travel agent sites or not. Technological developments regarding travel purchases have affected the industry dramatically.

Logo Travelocity.com

Direct bookings and reservations by travelers via the internet, using specialist software and GDS sites have increased the opportunities to book both travel and accommodation. Internet booking by travelers has grown and will most likely continue to grow with the spread of other technologies, such as the optical fiber network, online visual presentations of travel product and CD-ROMs. Furthermore, ticket-less travel using smart (computer chip embedded  credit cards or e-tickets is also a key factor influencing electronic based purchasing by travelers. The internet also plays an important role as a low-cost and efficient means of sourcing information about travel and travel destinations and is used to help travelers in their travel decision-making. As a result, in particular circumstances the internet is taking the place of the travel agent. However, the usage of the internet (although growing) is not overtaking all aspects of travel. The use of the internet for bookings and sourcing information varies according to ‘type of trip’ and market segment. Additionally, best practice by the leading travel agents suggests it is feasible for agents to compete with the internet. Whilst there is considerable research into why consumers generally use the internet, there is less information about why they use the internet for travel. Available research suggests the internet is used for travel because of related efficiency  ease and the low cost in making travel enquiries and purchases.

Logo hotWire.com

There is also a view that the internet is a good source of cheap and discounts deals. As already highlighted, the internet is largely used by domestic travelers for booking air travel and accommodation. Scant information available about travelers use of the internet suggests that specific study is needed, with an exploration of current use and plans for future use.  The Travel Agent Service Industry is undergoing substantial change as a result of environmental and technological changes. Internet usage was the main issue identified in relation to trends and practices that are currently occurring within the industry. The issue, however, is closely linked to the issues of distribution and service. The internet has enhanced the distribution of travel-related content, pricing information and travel planning tools for consumers. In enhancing the empowerment of consumers to conduct their own research, as well as to plan and book their own travel, it has also created transparency, which has resulted in more price-sensitive travelers. The internet also provides travelers with increased options. due to the growing number of sites available and the information and services offered. However, it is unsustainable for agents to continue to compete on price. It is important to note that, although the study found a general trend towards the uptake of online bookings, travel agencies still remain the most popular mode of booking overseas travel.

Logo Hotels.com 

The internet, whether perceived as a threat or a benefit, plays a pivotal role in the distribution and provision of services. The increasing use of technology, both by  providers and consumers within the industry, highlights the need for travel agents to differentiate themselves from the services offered through the internet. A refocus of the travel agent’s role, which places the emphasis on, for example, niche marketing, value-adding and personalized services, could effectively meet the challenges brought on by the internet. Current available data, while identifying the internet as a pervasive factor in booking trends and patterns, do not adequately account for the needs and desires of consumers and the ways in which consumer views relate to distribution and service. The recommendations put forward throughout this report are, therefore, also a reflection of the need to broaden the research parameters beyond the confines of internet usage and more specifically within different markets.  In identifying the current trends and practices in the Travel Agency Service Industry, the research was based on secondary data to specifically consider the following issues, as identified by Indian Tourism:

The fundamental role of a travel agency can be broadly summarized as: information, distribution, reservation and services. For a typical business day, a travel agency’s functions include: 

Arranging transportation – air, sea cruises, bus, rail, car rentals locally and abroad;

Preparing individual itineraries, personally- escorted tours, group tours and selling prepared package tours;

Arranging hotels, motels, resort accommodations, meals, sightseeing, transfers of passengers and luggage between terminals and hotels, as well as special events such as music festivals and theatre tickets.

Handling and advising on the details pertaining to travel and baggage insurances, travelers’ cheques, foreign currency exchanges, documentation requirements (visas, health certificates etc.)

Using professional know-how and experience in the provision of air, train and other transportation schedules, hotel rates and their standards as well as qualities;

Arranging reservations for special-interest activities such as religious pilgrimages, conventions and business travels, incentive and educational tours, eco-tourist and gourmet tours, sporting/adventure trips etc.


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