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The Airline Reporting Corporation (ARC) recently reported that the amount of revenue travel agents are getting from ancillary airline products and services has increased more than 350 percent compared to the first three months of last year and agents have earned 170 percent more during the first quarter this year compared to last year.
What's the reason for this uptick in sales? According to Val Kalliecharan from Grace Bay, Providenciales, and Turks & Caicos Islands, it's mostly due to bundling amenities for clients. "For us here in Turks & Caicos, it's mostly about bundling things (air, hotel, tours, transfers, activities, inter-island transportation, restaurants, etc.) so that the client feels like there's been thought put into their vacation plan and that what they're going to get is solid and secure," he said.
Michelle Harris, Director of Marketing of CTMS Travel Group said that there is a variety of reasons for an uptick. "Pre assigned seating, convenient online prepay options, larger, comfortable seating options, leg room etc. on an increasing number of flights, access to an increasing number of airport lounges, gourmet onboard meal pre pay options (airlines are upping their game when it comes to flight meal options) and the wider use of wider use of onboard or in room Wi-Fi," she said.
"Airlines have added more ancillary options for travelers, which gives travel agents the opportunity to sell more than just the basic fare," said Jerry Behrens, Executive Vice President, Strategic Development, Travel Leaders Group. "The different classes of service that have been added is the best example. it's no longer just main cabin and business class, airlines have added select seating options in between the two traditional classes of tickets. Additionally, the airlines have continued to make these ancillary options easy to book through the GDS systems utilized by most travel agents."
However, Harris said that CTMS agents do not receive commission on the sales of ancillary add-ons. "This is an economical value added service that we offer our corporate travelers," she said.
Kalliecharan said that agents typically get 10 percent, but for some operators it's as high as 20 percent. "We also have net rate agreements with some of them so we charge the guests' credit card and markup by 25 percent," he said.
Agents are not exactly going out of their way to encourage add-ons. "If a client asks for this service, we'll provide it, but other than that, they book it themselves (prefer to use points, choose seats, enter their own passport info, check in online before travel, etc)," said Kalliecharan. "We do package sometimes with airfare coming into PLS, but it's mostly everything else that we book (either separately or via a package)."
Harris said that CTMS itself on prides offering a high level of personalized service. "Our supplier relationships ensure that we can provide the service and options our travelers demand quickly and efficiently," she said. "Most ancillary options can be completed online or via the Global Distribution System (GDS) as part of the travel booking process. In addition, traveler preferences including seat and meal options can be preconfigured making it an effortless process for our agents."
In the corporate travel industry, she said that most suppliers are in the process of offering ease of reserving ancillary services. "It is continuing to evolve throughout the travel industry as more and more suppliers, both major carriers and smaller airlines for example, continue to up their game in order to profit from an increasing amount of add on services."
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