Closing what many have called the best year for retail travel sales in recent memory, cautious optimism describes travel advisers’ anticipation about the coming year. And while that optimism has been tempered by recent terrorist attacks and the presidential campaign, already-strong 2016 bookings offer great promise for the year ahead.
Companies ranging from Travel Leaders brands, to Cruise Planners, to Signature Travel Network all reported higher sales in 2015 over 2014. That growth was anywhere from single-digit percentages for some segments to growth that Drew Daly, general manager of network engagement and performance, saw at CruiseOne and Cruises Inc.: “record-breaking, double-digit growth.”
Virtuoso also reported a solid 2015, with an increase in year-over-year sales from $14 billion to $15.5 billion, and 2016 sales are already up in the high single digits.
That growth is expected to continue during the coming 12 months, barring setbacks from future terrorist attacks.
“Nexion’s 2016 sales are off to a strong start, with solid double-digit growth with many of our cruise and land vacation suppliers,” President Jackie Friedman said.
Similarly, MAST Travel Network President and COO John Werner said his consortium’s bookings look solid going into 2016.
Maggie Rauch, a Phocuswright senior research analyst, said that gross travel agent bookings in the U.S. continue to grow along with, or slightly slower than, total bookings. Some are being lost to online channels, she said, “but the shift has slowed considerably, and, for the most part, travel agents are holding onto their core business."
In-person agent engagement is also expected to increase in 2016 as it did in 2015. Most conferences and in-person networking opportunities, such as Signature’s conference, saw increased attendance levels in 2015: The consortium’s senior vice president for sales and marketing, Karryn Christopher, said the network saw an attendance increase of 150 agents, for a total of 1,350, and a 25% increase in suppliers, at 850.
ASTA also had a strong convention this year, drawing 850 attendees and more than doubling 2014’s attendance. The society, which has some 8,800 members, has also partnered with a variety of consortia that are either mandating or subsidizing membership. In the last 12 months, Jennifer Michels, vice president of communications, said ASTA has added 100 agency members, largely due to those partnerships.
Consolidation is also expected to continue in 2016.
Robert Joselyn, president and CEO of Travel Agency Management Solutions (TAMS), called it “the hottest market in my memory for acquisitions.”
“There’s been consolidation, and I see that continuing, with the caveat that a lot of the good acquisitions have already taken place.”
Meanwhile, technology continues to evolve and expand. Many hosts, consortia and travel companies offered either new or updated versions of platforms, programs and apps this year, and they will continue to do so as technological capabilities grow, especially with regard to mobile platforms.
For example, Cruise Planners recently introduced an addition to a marketing initiative that automatically sends emails to agents’ clients during the buying process. Clients will now receive reminders to book their next cruise while onboard the ship.
“We feel that our job here at Cruise Planners headquarters is to be really high tech and make sure that we’re helping our agents communicate with their customers,” said Michelle Fee, cofounder and CEO of Cruise Planners, an American Express Travel Representative.
The threat of terrorist activity is weighing heavily on everyone’s minds, but while some reported cancellations after November’s attacks in Paris, little immediate impact has been felt. Friedman said, “We suspect that some travelers may be taking a ‘wait and see’ approach.”
Ensemble Co-President Libbie Rice said it would be interesting to keep an eye on escorted tours in Europe, which she considers a “beginner product” for that region, but she added, “I think your tried-and-true travelers aren’t put off by [the attacks].”
Patrick Fragale, president of Protravel International, said, “Based on our clientele and their feedback, we’re seeing that the American traveler is more resilient than they were 10 to 12 years ago and that they will largely continue to travel.”
Even so, the possibility of future attacks remain what Vacation.com President John Lovell called a “wild card.”
The presidential campaign also could throw a curve ball in 2016 because traditionally sales decrease during election years.
“Anything can happen, and we have to be prepared for the unknown and the fear of the unknown,” said Roger Block, president of Travel Leaders Franchise Group.
However, sales for 2016 do appear to be off to a good start for most. Rice said Ensemble was already seeing bookings for fourth-quarter 2016 travel.
“If I just look at ’15 going into ’16 and the strong numbers that we’re seeing, I don’t have a concern yet,” Rice said.
Tzell Travel Group CEO Barry Liben agreed, saying, “Tzell is currently trending ahead with positive growth for next year, and we are already seeing high single-digit increases year-over-year."
Joselyn said agents should work on the overall health of their business itself in 2016, including reviewing financial and operating metrics and embracing service fees as a revenue stream in a changing environment.
“One of the things agencies need to do is they need to anticipate changes in their revenue stream in advance of seeing, actually, the dollars come in or not come in the door,” he said.
Joselyn said he, like many, was “cautious but optimistic.” He based that feeling on stats: For nearly 15 years, TAMS has collected detailed financial data each quarter from 180 agencies in North America, then has provided analytical feedback to the agencies.
Joselyn based his positive outlook on momentum, noting that “2015 numbers are the best numbers … I’ve ever seen from my agencies.”
Senior editor Jamie Biesiada covers travel retail for Travel Weekly.