Expedia vs Thomas Cook, the E-Tourism

This new way of preparing and booking a travel has totally transformed the travel market in etiologic terms: changing of customer behavior; and In economic term: reduction of costs, low price, competitiveness… Bit by bit, the place of offline agencies become less important, creating a disruption in the market. These agencies have seen their sales fell but also and above all their market share. We will see in a first part, a presentation of the tourism market, Its history; Its figures accompanied of concrete examples, France and united states.

With the development of Internet, intermediaries are evolved, reducing the market share of traditional agency and increasing the part of online company. Competition has increase allowing to develop a price competition, more favorable for customers. Travel agency must adapted in order to stay competitive and follow the evolution. B) Story of travel agency Thomas Cook, international travel agency is the first one to have organized a travel in rain for a group of about 540 people in 1841 in United Kingdom.

In 1845, he opens his first agency, the first travel agency. The concept is to offer travel in train or steamboat toward various destinations: Europe, USA… With the development of this concept the company integrate hotels at its portfolio, allowing sell and organism all the travel. This concept is to take over a competitor, Club Med in 1950, offering fly and complete stay with various activities. Before the Second World War, tourism industry stay reserved to wealthy people in spite of the obtaining of paid leave in 1914 in US ND 1936 in France .

Consequently, tourism become accessible at a larger population after the second world war thanks to technological innovations and arbitration allowing the development of travel agency and foremost the development of other way to travel: car and plane, real substitute to train in order to go abroad easily. The new way of transport, the plane is the veritable sign of boom of agencies. Indeed, plane allows to move people toward far away countries: Asia, Caribbean… Thanks to continual innovation, plane can transport more and more people, on greater distances and allowing higher savings.

Boat is also a way of transport that favors development and so success of travel agencies. In the 19th century, liner is the principal way of transport through ocean and sea, allowing to transport a lot of people. Today, this type of transportation is above all destined for cruise, which offer a complete service: transport; activities; accommodation; swimming pool; call… The last but not the least innovation impacted on travel agencies is Internet. With the global development of Internet, the tourism industry, especially for travel agencies, is completely modified.

With Internet, customer is freer, he can compare an offer with other agencies; he can buy a ticket or do a reservation directly without pass by an agency; he can do reserve about destination alone, no need of an advisor… Consequently, agencies become more an advisor than an intermediary between clients and professionals. In a large part, clients do research in Internet about that they want: which country; how; when… But come back toward agency, because agency is more ability to do reservation and propose adapted formula.

The problem AT Internet Is Tanat sources AT International or reservation are too Important, too numerous. Customer is often lost and do not which website or offer is reliable or not. But this problem is not important when we see advantages of Internet concerning tourism. In more that the development of specialized website, comparing offer of different company or agency, allowing to chose the best one thanks to various criteria of chose; Internet allows the development of travel agency specialized in Internet and so offering lower cost.

Moreover, with Internet, customer can reserve a flight directly to the air company and can reserve directly his accommodation in the country chosen, reducing costs. Indeed, when clients do reservation for a travel through an agency, the final bill is more expensive in view of the committee of the agency. C) Evolution of travel agency 1- USA example: With the development of Internet, the function of travel agency has really changed leading the diminution of the number of agency in the world. To prove that, we can take the example of United States.

In USA in 2008, the number of travel agencies is from of 34,000 to 18,000 in one year . Indeed, even if sales of travel agencies are stables, their part in comparison of global sales (sales in internet, direct sales… ) decreases. The following chart, show the evolution of market share between 2006 and 2009 of agencies in comparison to the market in USA in billion dollar: This reduction of agencies’ market share is due to changing that brings Internet. People have less and less recourse to agency for their traditional travel.

People who get used to a traditional travel (I. E. : go every summer in Hawaii) how the country, how hotel, airplane company… They can organism their travel themselves. But for specific travel, inordinate travel, toward inhabitable destinations like Africa or Asia or for specific need (wedding); people prefer again pas by an agency which know everything is necessary to know about the destination and know prepare the travel. In 2006 in USA, traditional travel agency reserves still 77% of cruises and 73% of formula .

The changing can be visible also by prices. To penetrate the market traditionally reserved to travel agencies; online agencies are completely broken prices, becoming an important competitors for travel agencies in term of offer and so in term of price. Internet was view like a competitor for traditional agencies, but today Internet is more view like an asset, allowing to develop new tools and new offers to be more nominative than company which are completely on internet like Expedited, Orbits, Traceability or Principle.

However, for agencies which are not on Internet, result can be dramatic, the non-adaptation of evolution with Internet can be a disadvantage for these agencies. 2- France example: 10 snow ten evolution AT travel Ministry In ten world, we can also we Interest on ten French market, even if evolution is global, another point of comparison allows to show the really impact of Internet on this industry. In France, tourism is the market where purchases on Internet are the most important, 58% of Internet user are already by a ravel on Internet.

Travel online generated в?8 billion in 2009 more 15% compared with 2008; 35% of French people are reserved their travel online for this same year . This figure increases constantly showing the important for travel agency to have in place in the online offer. But 40% of suppliers of travel do not offer online reservation, which is for this player a lack of earns but also an opportunity of development. With the development of Internet, people have possibility to prepare or reserve their travel; it is important to make a distinction between both because a person who repaper his holidays on Internet do not necessary reserved it online.

Indeed, 64% of French people prepare their travel on Internet in order to have a larger offer (comparison between the different offer) and in order to find the offer the most adapted. Moreover for 39%, Internet allows to find travel less expensive rather than in agency. Consequently Internet is an important source of information to prepare a travel, 91% of traveler are consulted Internet before buy an offer in agency. To find information about a travel, people prefer more and more find information on Internet rather than go in office of tourism or travel agency.

Indeed, 77% of French people prefer go on Internet to find information that they need; than 21% go on agency. In France, the five website of travel the most visited are: – voyage-sync – legitimates – provenances – expedited – pods Like we can see, in this five best website of travel, none is a travel agency (website), showing that website specialized on Internet (no agency) are more important than website of companies which are also on Internet. Internet is a real and indispensable tool to find the good travel at lower price. In France: will of customers online and offline Indicators Online buyers Offline buyers Both buyers