Travel Reference
In-Depth Information
INTRODUCTION
T
The tourism channel of distribution is an operating structure, system, or linkage of various
combinations of organizations through which a producer of travel products describes, sells, or
con
rms travel arrangements to the buyer. For example, it would be impractical for a cruise line to
have a sales of
ce in every market city of 5,000 or more people. The most ef
cient method is to
market through more than 15,000 retail travel agencies in the United States and pay them a
commission for every cruise sold. The cruises could also be sold through such
as
tour wholesalers (who would include a cruise in a package vacation), through corporate travel
of
ces, via the Internet, or by an association such as an automobile club. Thus, the cruise line uses a
combination of distribution channel organizations to sell cruises. Figure 7.1 extracts the operating
sectors from Figure 1.2 and shows that travel trade is one of the important sectors of the tourism
industry. Tourism
intermediaries
are similar to those of other basic industries such as
agriculture or manufacturing (see Figure 7.2). Their products
flow to the ultimate consumer through
wholesalers, distributors, and middlemen. Although there are similarities with other industries, the
tourism distribution system is unique. Tourism produces mainly services that are intangible. There is
no physical product that can be held in inventory to
flow from one sales intermediary to another.
Instead, the
distribution channels
is, for example, a hotel room that is available on a certain day, which is very
temporal. If the room is not sold, that revenue is lost forever.
The travel industry landscape is constantly changing, and nowhere is this more true than in
travel distribution. Powered by advances in technology and the growth of e-commerce, social
media, and smart phones, travel distribution has changed dramatically. The impact on travel agents
and consumers brought about by the
''
product
''
Internet
and technology are examined in this chapter.
F
Figure 7.1
Operating
sectors of the tourism
industry: travel trade.
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