Tuesday, November 29, 2005

ABTA should view itself as a media organisation rather than a regulatory body

There are many views on ABTA’s future role, but, for what its worth, this is ours:

In the broadest sense, what is happening in travel is that deregulation- of airspace, of channels, of suppliers- has and is shifting the balance of power to the consumer. The reality is, the consumer increasingly doesn’t care about bonding and other protection issues- the shear volume of passenger numbers on Ryan Air proves this- many of these trips are linked to independently sourced accommodation, and therefore unbonded.

The key issue here, is that consumers are self-regulators- cautious consumers care a lot about protection, and regulate themselves by choosing bonded providers. Less cautious consumers take more risk. This is why, despite the advent of self-check-in- many consumers still CHOOSE to queue up to check-in- they would rather not take the risk. The real risks of things going wrong with your holiday supplier are getting lower- what if Ryan air goes bust? Come on- with something like 900 million Euros cash reserve, the chances are unlikely. Evidence suggests that even consumers who have been caught by the (rare) demise of a low cost carrier/supplier are still prepared to take risk in future- they regard themselves as unlucky, and in real terms, with disposable incomes rising, losing £800 per person (the average package price) is bloody inconvenient, but not the end of the world.

Therefore, ABTA needs to shift itself from standing for what consumers care increasingly less about- regulation and bonding, towards what they really care about. What do they really care about? Information. Without information they can’t exercise independent choice. Consumers are hungry for independent travel information- why else do they spend so much time on search engines, and in the research process. Time after time studies show that online travel brands are poor information sources- they are investing in only so much information to get a converted booking to their site.
ABTA has a real opportunity to position itself as the consumer’s information brand- the independent stalwart of advice and reference- a position is can hold due to combined volume of its suppliers/trade members. ABTA’s role should be to explain to consumers why fuel supplement’s occur- rather than get bogged down in should they occur- thus adding value both to their members and to the end customer. If ABTA can be the nodal point between changing suppliers and information-hungry consumers, this is a powerful position.

This means re-inventing itself as a media organisation. In today’s information economy all businesses are media brands to a certain extent, but for ABTA this will require a fundamental shift in its thinking, its structure, and its commercials. We can hear Newman street responding to this with ‘but lots of consumers already come to to our website for information..’ That’s the tip of the iceberg- do you satisfy them? Do consumers regard ABTA as the information voice of the newly-empowered traveller? Wouldn’t it be powerful if they did?

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