Last-minute bookings may be costing tour operators and travel agencies the ability to guarantee departures. How Singapore travel companies cope with this.
It’s the classic chicken-and-egg. Travellers are wary about booking tours that are not guaranteed, yet tours are not guaranteed unless passengers start booking them. The conundrum is understandable in down times, say, a weakened economy which causes a slowdown in bookings or a wait-and-see-if-prices-will-drop mindset, as was the case in Singapore last year.
But a bad habit of travellers in booking travel at the eleventh hour, which is increasingly cropping up, may be costing tour operators and travel agencies the ability to guarantee departures.
Singapore’s outbound travel kicked off on a high this year, with an increase of 11.2 per cent in January 2017, compared with the same period last year according to the Singapore Department of Statistics. The Lion City’s love for travel was also evident through the strong turnout for the two major travel fairs, NATAS Travel Fair and Travel Revolution, in February.
While Singaporeans are known to be avid travellers who religiously plan their holidays well in advance taking into account upcoming public holidays and long weekends, an estimated 15 per cent book less than 30 days from their tour departure date, with five per cent booking less than two weeks beforehand, a check at Chan Brothers Travel shows. A significant proportion comes from travellers opting for free-and-easy packages who prioritise flexibility as they face time constraints and are unable to plan ahead.
At Dynasty Travel, last-minute bookings of less than three weeks are evident for shorthaul destinations, or due to other tour agencies cancelling their group departures in view of insufficient numbers.
Ideally, travellers should seek travel consultation at least four to six weeks before departure, said Dynasty’s spokesperson Alicia Seah.
What to do?
Given the better climate this year and as a means of incentivising travellers to book early, Trafalgar (Asia) has guaranteed that 100 per cent of its 2017 tours encompassing 109 guided summer tours in Europe and Britain, as well as 17 tours across Asia departures, are definite. “This is unprecedented. In 2014, we had 90 per cent definite departures for our Europe and Britain trips,” a spokesperson said.
It is also gaving a raft of incentives including an early payment discount of 7.5 per cent which could be combined with Trafalgar Frequent Traveller discounts to enable another five per cent savings.
On many trips, young travellers (five-17 years old) can enjoy up to 10 per cent discount when accompanying an adult, and solo travellers can save by pairing up with a fellow traveller (of the same gender) in a twin room. If Trafalgar is not able find a match, then the solo traveller could stay in a single room at no extra cost.
Trafalgar (Asia) president, Nicholas Lim, said of its Definite Departures: “At Trafalgar, we are wholly focused on strengthening relationships with our valued industry partners, ensuring that they are fully equipped to sell our guided holidays with confidence and ease. We are thrilled to be able to guarantee agents that the chances of winning with Trafalgar are 100 per cent when it comes to selling our extensive portfolio of 109 guided holidays for summer in Europe and Britain and 17 different trips across Asia.”
Chan Brothers Travel spokesperson Justine Koh opined that large travel operators have the luxury of a higher number of confirmed departures that numbers to over 1,000 at any point of time, appealing to travellers who wish to have that assurance for their holidays. Also, limiting departure dates for its celebrity-led tours, which only have one or two specific departure dates, increases the likelihood of definite departures.
According to Dynasty’s Seah, travel agencies are also conceptualising tours with fewer number of travellers of four to 10, to depart to places such as Bhutan, Uzbekistan and even Egypt where it is hard to form bigger group sizes, as a way to ensure a higher propensity of definite departures.
However, even major players like Dynasty Travel or Chan Brothers Travel are not immune to being forced to cancel tours due to travellers delaying their travel purchases.
Seah shared that without sufficient numbers of travellers or time for consolidation, the agency is compelled to release seats back to the airlines to avoid penalty or surcharges.
Said Seah: “We usually have to manage the customers’ expectations; we are sincere and truthful in our transactional procedures.We believe that if we are able to provide professional and honest advice or provision of alternatives or refund made seamlessly, the impact of cancelling trips is minimal and customers will return to the travel agency in future.”
Consumers are generally made aware of potential cancellations in the fine print under the terms and conditions. In the event of tours being withdrawn, travel agencies ensure their customers are informed and facilitated with alternative trips well before the departure dates.
Chan Brothers’ Koh said that while cancellations might lead to a loss of revenue and more importantly customer confidence, the tour operator tries to minimise such cancellations by offering more modes of travel and multiple departure dates for each tour.
Koh stressed the importance of leisure travellers to be proactive in making their travel decisions and not wait until the eleventh hour. Every group size has to start from zero. Prudent travellers understand that if they wish to secure a preferred departure date at the best possible rate, the modus operandi is to fix their travel plans and schedule their bookings early, she said.
This article was first published in TTG Asia May 2017 issue. To read more, please view our digital edition or click here to subscribe.