Travel agents: Hong Kongers prefer the real thing
While travel agents are trying to make a comeback after more than a decade of waning in the developed world, they never went out of fashion in Hong Kong.
The Internet was a travel industry job-killer, particularly in the United States, where the number of agency locations has halved since the high of 34,000 branches in the mid-1990s. Online flight and hotel booking services, such as Expedia, cancelled out the middleman so everyone could be their own travel agent.
But while EMarketer forecasts online travel sales in the United States to grow 11 percent to $119.2 billion in 2012, offline travel agents show signs of returning.
Nearly one in three leisure agencies in the United States is hiring, according to PhoCusWright, a travel research firm. Travel professionals can thank an improving economy, but also consumers' web-fatigue.
It turns out that online booking is not the convenient click-and-fly experience that travelers were hoping for. In one study by the IBM Institute for Business Value Studies, 20 percent of participants said it took them more than five hours of online research before making their booking.
In Hong Kong, savvy travelers learnt early on about the opportunity costs in booking vacations online. They never quite adopted Internet transactions for travel.
"Hong Kong consumers primarily want convenience when booking holidays," says Joseph Tung, executive director of the Travel Industry Council of Hong Kong. "Hong Kong is not a big place, it is convenient for people to make direct contact with travel agents. We also have regulation mechanisms to protect the consumer."
This accounts for the 85 percent of travelers who go to Hong Kong's 1,650 registered travel agencies when planning their trips.
It feels like there is a travel agent on every corner of Hong Kong. Travel Expert is one of Hong Kong's largest travel services agencies, with 50 branches in the city.
Tung is optimistic that the demand for agents will continue to grow as outbound traveler numbers increase with the opening of the Kai Tak cruise terminal next year.
The human touch
The latest agency to take advantage of Hong Kong's healthy demand is Flight Centre, Australia's largest travel agency. A second branch of the agency opened last week in Hong Kong's residential neighborhood Happy Valley and the company has plans to open 2-3 more stores by 2013.
"The expertise and support that an offline travel consultant can bring adds value to the holiday," says David Fraser, managing director for greater China for Flight Centre Hong Kong. "Given that a retail travel agency is no more expensive than booking on the Internet, I don't see why you would bother to book online when you have extra services effectively for free."
Flight Centre promises a 24-hour emergency support team so that in the event of a disaster such as 2010's Icelandic volcano ash cloud, travelers can in theory get hold of a Flight Centre consultant to sort out their travel itinerary.
"As unfortunate as those disasters are, they are often good for our business because it shows the benefits of us," says Fraser.
Accountability and personalized service is almost as important as convenience for Hong Kongers who spend more per capita than Asia's two other major globetrotters, Japan and Korea.
For the upper to mid-range Hong Kong traveler, a higher amount of consultation is required before booking a trip. Flight Centre targets this type of customer, particularly expatriate, English-speaking travelers who are less likely to book package tours, opting for customized vacations.
"Expatriates have a higher demand for service as they want to be given a lot of knowledge about their destination. When Hong Kong people want to go to, say, Thailand, they just want the agent to get them Thailand and don't ask for that much information," says Joseph Tung.
Hong Kong traveler Mr. Lee who just booked an eight-day package tour to Russia through Hong Thai Travel Services has never booked a trip for leisure or for business through a website.
"I need to know that I am making a transaction with a real person," he says.
Out-of-work travel agents who are knowledgeable, efficient and accountable might just consider relocating to Hong Kong.