More Related Content Similar to Travel merchandising overview (20) Travel merchandising overview1. The New World of
Travel Merchandising
Tom Bacon Consulting
December, 2011
©2011 Tom Bacon Consulting, LLC. Proprietary and Confidential. 1
2. Airline Commodization
Travel
Distributors:
Price Focus
Successful Third Airlines Match
Party Distribution Fares; Cut Costs
Commodization:
Svcs Cut;
No
Differentiation
©2011 Tom Bacon Consulting, LLC. Proprietary and Confidential. 2
4. Airline Differentiation
New Value
Added
Services
Airlines Match
Successful Direct Lowest Fares; but
Distribution Offer
Customization
New
Customer
Engagement
©2011 Tom Bacon Consulting, LLC. Proprietary and Confidential. 4
5. Airline Differentiation
New ancillary fees:
• Allow fare match with LCC’s
Ancillary
• Introduce new revenue streams
$ Service
Fees o Increase total revenue
• Provide customers with new choices
All
o New customer engagement
Inclusive
o Reduce costly behaviors
LCC Fare • Tend to drive traffic to website
Match
o Not fully supported by third
parties
Full-Service New Ancillary o Lower cost distrib channel
Fares Svcs
…AND…
©2011 Tom Bacon Consulting, LLC. Proprietary and Confidential. 5
6. Travel Merchandising
Travel
INTRODUCING Merchandising
A WHOLE
NEW WORLD E-commerce; CRM;
Ancillary OF AIRLINE
Service MARKETING Science of Choice
Fees
All Market Trvllr
Inclusive Generic
Segmentation ID’s
LCC Fare
Match
Freq
Branded Personal-
Sell-up Flyer
Full-Service New Ancillary Fares ization
Perks
Fares Svcs
©2011 Tom Bacon Consulting, LLC. Proprietary and Confidential. 6
7. Travel Merchandising
• Most travel suppliers have not
recognized the shift in customer Travel
needs Merchandising
• Allegiant
Airlines, however, positions itself
as a travel merchandiser – not
E-commerce; CRM;
simply an airline Science of Choice
Market Trvllr
Generic
Advertising, referrals, non-air Segmentation ID’s
promotions include hotels, car
rental, and events Freq
Branded Personal-
30% of revenue is not fare- Sell-up Flyer
related (2X airline average) Fares ization
Perks
©2011 Tom Bacon Consulting, LLC. Proprietary and Confidential. 7
8. Travel Merchandising
ARE YOU FULLY Travel
EXPLOITING THIS NEW Merchandising
WORLD?
E-commerce; CRM;
Ancillary Science of Choice
Service
Fees
Market Trvllr
All Generic
Inclusive Segmentation ID’s
LCC Fare
Match Freq
Branded Personal-
Sell-up Flyer
Fares ization
Full-Service New Ancillary Perks
Fares Svcs
©2011 Tom Bacon Consulting, LLC. Proprietary and Confidential. 8
9. Tom Bacon Consulting
Revenue Optimization
30 Yr Track …across the
Record of Travel Industry
Success
Pricing
Pricing & Rev $20 B Global
* Revenue Mgmt
Mgmt Airline
* Ancillary Service Fees
Schedules/ >$1 B Low Cost * Revenue Forecasts
Route mgmt Carrier
REVENUE
Mkg, Sales, & >$1 B
Distribution Independent OPTIMIZATION
Regional Airline Planning Product
* Network Mgmt
FP&A Travel * Profit Mgmt
* New Markets
Distributor (IT) * IT Systems
* Distribution /
* Corp.Developmt
e-commerce
©2011 Tom Bacon Consulting, LLC. Proprietary and Confidential. 9