Meehan: sale of ancillaries beneficial for all parties
EVEN though the sale of airline ancillaries do not directly translate into commission dollars for agents, selling these products remains crucial for them, according to Travelport.
Ancillary sales allow agents to provide value for the traveller that they would seek out in any case, says Mark Meehan, managing director Asia-Pacific at Travelport.
“With the sale of ancillaries, it is beneficial for the airlines (and also) the agencies. Agents can’t afford not to be doing ancillary sales because that’s what’s going to drive the loyalty and attachment to the agency because it demonstrates value for the traveller. It’s not just about a hard dollar number,” he said.
Enabling agencies to sell ancillary products via Travelport’s Rich Content and Branding platform also has the added benefit of being a time saver for them, according to Jason Clarke, managing director global sales at Travelport.
“What we have seen among agencies around the world is that they would book the traveller a flight, then they would ring the airline or go onto the airline website to confirm a seat, or bag or other ancillary. This is inefficient from a cost and time perspective. If we can do it on the same platform, that would save the agent lots of time from the process,” he said.
But as airlines grow more dependent on ancillary sales to bolster profitability, the question remains whether carriers should pay agents for their added efforts to upsell on their behalf.
Clarke thinks there is room to rethink the traditional commission structure in order to satisfy both the airline and the agency.
“It’s not about recompense for an individual meal, seat or bag, but they should be compensated for the overall value of what they bring to that airline. We are starting to hear conversations about airlines looking at value-based economics as opposed to paying for individual components,” he explained.
“Ultimately, the agent and the airline needs to work out the economics.”
