In a world of information overload, panel discussions stand out as a powerful format for the exchange of ideas, insights and real-world observations.
Last week, the more than 500 travel pros who attended ACTA’s summit in Toronto on Sept. 14 were treated to just that as industry leaders took to the stage at the Toronto Congress Centre to unpack the trends that are shaping the Canadian travel industry today.
Moderated by ACTA Chair of the Board Mary Jane Hiebert, the live discussion – entitled “Maximizing ROE (Return on Effort) in the Canadian Travel Industry: Trends and Strategies for 2024” – featured Lisa Pierce, vice president, global sales for Air Canada and Air Canada Vacations; Zeina Gedeon, CEO of Trevello Travel Group; Joseph Adamo, president of Transat Distribution Canada and chief sales and marketing officer of Transat; and Michael Johnson, president of Ensemble.
Strategies & trends
Hiebert kicked things off by asking each panelist about their business plans for 2024.
Lisa Pierce said Air Canada, backed by strong demand, is looking to grow its network “as much as we can.”
“Especially for international to Europe. We're seeing a lot of opportunity there,” Pierce told the audience.
She noted how Canada’s population, in June, reached 40 million people, “which is a tremendous opportunity.” And some 23 per cent of people are immigrants, “which is a good thing for travel,” Pierce said.
“There's a lot of people that want to make return trips and visit their family. There are students coming. We're trying to build our network and take advantage of those opportunities,” she said.
Zeina Gedeon said Trevello’s growth as of late has been the “biggest we’ve seen in the history of our company.”
“It has put a lot of pressure on advisors and our support staff. We can't hire fast enough. It's a good thing,” Gedeon said.
Speaking on trends, Gedeon said many travellers are still booking trips at the last minute – with the exception to cruise crowds, who are locking in staterooms at least 120 days out.
“They’re the only ones these days who are planning,” Gedeon told the crowd.
All industries, meanwhile, are wondering if the economy is heading straight into a recession.
Andrew Grantham, a senior economist with CIBC, spoke earlier at ACTA’s conference to review just how the Canadian economy is coping with higher interest rates and, by CIBC’s own account, a recession hasn’t begun just yet.
However, if an economic downturn were to occur, “I think our industry would fare better than most,” said Transat’s Joseph Adamo, noting “$1 trillion dollars of wealth” that will trickle down from grandparents to their children, and beyond, over the next few years.
“That augurs well for discretionary spending like travel. We're fairly bullish,” Adamo said.
Ensemble’s Michael Johnson said he is “highly encouraged” by 2023’s results so far, noting how more customers, these days, are seeking more value in their travel plans.
“That really leans into the strength of the advisor who can unlock different opportunities,” Johnson shared.
Focus on boomers & millennials
The discussion then segued into the types of opportunities travel advisors and agencies should be looking for.
Adamo urged advisors to pay close attention to the baby boomer and millennial markets.
“Baby boomers were on the sidelines for 2021 and 22. But they've come roaring back in 2023, which is great because they've got money,” he said.
Meanwhile, millennials – people who are between 25 and 40 years old – have established themselves as the largest traveller cohort demographic, he said.
“They don't spend as much as boomers, but they will,” Adamo said, adding that Generation X (people aged 41 to 56) is “not forgotten, but not as important.”
On baby boomers and millennials: “Learn how to work with one or the other – or both,” Adamo told attendees.
Travel advisors, for years, have been coached to pick a lane and carve out a niche.
At Trevello, advisors aren’t just picking a niche, they’ve tapped into an “uberniche,” Gedeon said.
“We have advisors who just do just Tahiti, or just Italy,” she said.
One opportunity Trevello hasn’t fully explored yet (but has plans to) is sustainability and the type of experiences that surround that, Gedeon said.
Johnson, meanwhile, lauded multi-generational travel as a lucrative trend that will continue.
The Ensemble executive is also seeing more travel agencies evaluating their time efficiency and making structural changes – with the goal of working smarter, not harder.
“Measuring that energy is vital,” Johnson said. “We need to maximize profitably.”
Plans for a smooth winter
Flight and program cancellations, a touchy subject that surfaces every winter, also came up.
“We're acutely aware of how important the peak seasons are,” Pierce said, speaking for Air Canada and Air Canada Vacations. “Especially around the holidays when people are planning family vacations.”
“We've worked very hard to make sure the schedule is as stable as it can possibly be. We still have issues, for different reasons. But as time goes on, we're becoming more secure.”
Pierce cited the industry-wide pilot shortage and fleet-related challenges, such as assembly line issues, as two factors that could lead to possible changes in the schedule.
“Our challenge is to be as precise as we can,” Pierce said. “And as time goes on, we're getting better because we have more history, we'll be more conservative, and we see what the impacts are.”
One step Air Canada Vacations has taken, ahead of winter, is to introduce a new commission policy that offers the trade enhanced protection and stability.
Travel advisors will now receive standard commission on any cancelled individual bookings made 45 days or more prior to departure (cancelled with deposit), with the exception of cruise and group bookings.
In addition, ACV will protect full commission on any schedule change that provides no option of reprotection and results in a cancelled booking.
There are conditions, however. In the event of unforeseeable and unavoidable force majeure situations that result in cancelled bookings, commission protection will not be applicable.
As well, for situations where a customer voluntarily cancels the reservation due to their refusal to accept ACV’s offered alternatives, protection, again, will not apply.
Adamo, on behalf of Transat, said building a flight schedule “comes with some risk.”
However: “Right now, as we speak, we're fairly stable for winter,” he said. “What’s been put out there will operate. Will there be nips and tucks? Of course. It can happen. It’s inevitable.”
“But we are, as an industry, in much better shape than we were in the last couple of years.”
Johnson said that between climate-related disasters and political uncertainty, disruptions “will always be part of our industry.”
“We have to start wrapping our heads around the fact that the new normal includes unprecedented events,” he said.
Johnson encouraged the trade to load their clients up with insurance “when and wherever possible.”
“It’s absolutely a no-brainer,” he said.
But the value proposition of an advisor should also not be fear-based, Johnson added.
“If you're playing on fear, then you're doing yourself a disservice. The value of the advisor is to be a travel professional,” he said.
Who's on the “sh*t list”?
Gedeon encouraged the trade to be more selective when it comes to deciding on which supplier partners to work with.
“One thing the pandemic has taught us is to pick and choose supplier partners…because they're a dime a dozen,” she said.
Gedeon revealed that Trevello has a “sh*t list” – a category reserved for suppliers that didn’t “have our backs” during the bad times of the pandemic.
“It’s during the bad times when you want to pick and choose who you want to partner with,” said Gedeon, who did not name names.
ChatGPT is “not the boogeyman”
So, where should travel advisors invest their time and energy?
“Take advantage of all the opportunities you have with your suppliers to learn about the products. Don’t only learn about it, but also experience it…it takes it to another level,” Pierce said.
Gedeon shared an “FFF” approach – focus, filter and forget.
Meaning: focus on what’s important (“Get the biggest ROI for what you do,” Gedeon said) and filter out the inquiries and products you’re not interested in. “Give them to other advisors,” she said.
Adamo invited the trade to “embrace the tools that are out there” and to not be heavily reliant on others.
That means “putting your toe in the water” with artificial intelligence and ChatGPT, Adamo said.
“It's not the boogeyman,” he said of the widely-discussed natural-language chatbot. “It is real. I don't think it’s going to replace what you do, but dabble with it. It can be a tool for building content. It can make you a better advisor.”
Not charging fees? “Shame on you”
Adamo also advised the trade to be more selective in how they spend their time, and that charging fees is one way to do that.
“If you don't charge professional fees, then frankly, shame on you,” he said. “Don't charge $15, $20, $25 bucks. At TDC, we are at $50 to $100 per pax minimum. And you tack on cancellation fees. You deserve it, and it’s worth it. It’s also a way to help you select segments.”
“If you're giving it away for free, what's it worth? If you're not charging for your time, then how can you ever expect the client to value your time?” he said.
“Service fees are, as far as I'm concerned, foundational to the value proposition of the advisor.”
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