B2C is “gaining momentum,” says Clementino. But travel advisors can swing the pendulum

One can assume that most travel advisors were delighted to see their customers come swarming back – in record numbers, in some cases – after years of inactivity brought on by pandemic-induced fears and travel restrictions.

The post-COVID travel boom seen in recent years has given the Canadian travel trade some much-needed stability and financial recalibration. But at what cost?

Jane Clementino, senior vice-president and general manager at TRAVELSAVERS CANADA, points to a shift that she says has been trending upwards for three years now – a weakening of B2B business as B2C channels rise in dominance.

“B2C is gaining momentum,” Clementino told some 550 travel advisors and 130 suppliers on a stage last September at Travel Market Place’s conference in Toronto.

Why is this happening? Clementino has a theory. 

Post pandemic, the demand for travel was so high, and because the industry lost so many travel advisors, there wasn’t enough bodies to serve everyone. As a result, some of the overflow went directly to suppliers – and it has stayed there.   

In speaking with tour operators, Clementino estimates that there’s been about a 10 per cent shift from B2B to B2C (cumulatively, pre-and-post COVID). Which is significant, when you think about it.  

The question, now, is how travel advisors can win that business back. Recognizing that suppliers have direct-to-consumer strategies (and have “upped their game to keep consumers coming back,” Clementino says), it’s a question worth asking.

“I believe that with the right resources, services and customer care, we can course-correct,” Clementino tells PAX. “It’s less about long-term or short-term and more about an ongoing commitment to demonstrate the value of a B2B channel to win some of those ‘converted’ consumers back.”

Building back B2B 

Clementino, for 36 years, has worked with indirect channels, from corporate to supplier to retail spaces. She’s always made a point of calculating how direct and indirect systems are split.

In the travel industry, the split fluctuates by vertical, Clementino explains.

“More recently, we see the hotels and resorts being more aggressive and transparent with their B2C approach,” she says.

As the market begins to stabilize and soften, winning back lost points, perhaps, has never been more important to the B2B space. 

But the narrative of this process, Clementino says, should focus on the opportunity to proactively "educate the consumer about the value proposition of a travel advisor.”

“B2B really does provide that door-to-door full service from the minute you leave your home until the minute you return from your trip,” she says. “This kind of peace of mind is important to mitigate any travel concerns, while teasing out the joys around travel.”

“Communicating these messages will not only bring back former B2B customers, but it will also likely attract new ones too.”

Find a win-win with loyalty programs

Every supplier has their own way of measuring distribution, but typically it’s either the total number of passengers (PAX) booked or total revenue by channel.

These metrics can often illustrate the power of B2B business. “Many suppliers look at both metrics, which traditionally demonstrate that B2B generates higher revenues given our ability to upsell and extend travel plans,” Clementino says.

So, how can travel advisors leverage that power and win back converted consumers?

Clementino has one suggestion for the trade: find a meaningful way to engage with loyalty programs.

“After the pandemic, everybody had credits and loyalty points after everything they spent. And so, they went directly to suppliers to look at their next dream vacation and use those points,” Clementino said in September.

It has to be win-win for all, however. As a starting point, agents must fully understand the components of a loyalty program – and what value it brings to clients – so they can properly articulate the benefits and savings, Clementino says.

It’s also important that a loyal program rewards both the client and the travel advisor.

“Advisors should always find a way to earn compensation when applying rewards points, whether via commissions or service fees or both,” Clementino says. “Integrating a client’s loyalty program to offset the price, or to enhance the experience, reinforces the value of a travel advisor, which is really the message.”

This is something Nino Montagnese, vice-president at Air Canada Vacations (ACV), recently referenced in an interview with PAX. 

He said ACV’s trade partners who have embraced Aeroplan (Air Canada’s loyalty program), including ACV’s loyalty point offers, are “making a killing” because loyalty customers tend to spend more and book higher room categories.

READ MORE: Winter Is Coming - Nino Montagnese unpacks ACV’s sales & trade strategy

“There are almost nine million active customers using Aeroplan today. So, it makes sense for our trade partners to understand the program and talk to it,” Montagnese told PAX.

He said Aeroplan customers “will attach their card knowing they're getting points – and they're spending.”

"And I'm not talking about redeeming,” he said. “I'm talking about them being able to accumulate points. They spend more.”

Of course, it’s natural for travel advisors to worry about loyalty programs stealing their customers. But Montagnese doesn’t view this as a major issue. 

“You can't promote to anyone without their consent anymore. Period,” he said.

His advice for agents selling ACV is to have their customers redeem Aeroplan points for an Air Canada gift card.

“The customer is using their points, they redeem for a card, the agent uses the card as a form of payment, and they get their commission,” he said. “A gift card can be a form of payment at Air Canada Vacations, so it's a win-win.”

Become a one-stop shop

Air also factors into the rising dominance of B2C – Clementino says more advisors are no longer selling air for a variety of reasons (the stress associated with last-minute flight cancellations and the lack of compensation being two).

And while this makes sense, given the increasingly complex nature of travel, ignoring air bookings may, possibly, be working against the trade.

READ MORE: TRAVELSAVERS’ KORE program celebrates first Canadian graduates

“Within the B2B market, we need to figure out how to play in a space where we provide all services – including air,” Clementino said in the fall. “We need to re-evaluate the fact that we’re giving air back to suppliers, because once we do that, suppliers will inundate clients with all kinds of marketing…things that take [clients] away from us.”

With the recent normalizing of travel demand levels, “advisors should reconsider providing all travel service needs – a one-stop shop – to start increasing air sales,” Clementino says.

All the newcomers who are joining travel industry, meanwhile, play a role in helping B2B channels reclaim some business.

“They will be able to provide support to seasoned advisors, enabling agencies to take on more clients, sell more travel and make more money,” Clementino says.

Industry newcomers are also in a position to bring their own network into the B2B space, which will ultimately contribute to agency growth, Clementino adds.

B2C spikes on weekends

Speaking for ACV, Montagnese agrees that B2C channels gained strength during the pandemic. “Customers couldn’t get through to a call centre and they couldn’t go into a travel agency, so they went online,” he said.

To that end, Montagnese says ACV’s B2B sales are now normalizing as consumers return to travel advisors to book their vacations and tours, which “aren’t always so simple” when booking direct, he said.

But Montagnese notes an interesting trend: ACV’s B2B sales are mostly happening during the week.

“My B2C sales spike on Saturdays and Sundays,” he said. “And I mean spike. High double digits. Why? Because travel agencies are closed.”

Of course, not all agencies are closed. Many travel advisors work seven days a week to serve their clients. But not all customers may know that, which could be fuelling the B2C channels.

As a method for capturing lost or missed business, Montagnese encourages agencies to create a balanced work schedule that includes weekends. 

“Promote that you're open on Saturdays and Sundays. Send emails out, because I'm taking B2C bookings on the weekend,” he said. “That’s maybe where [the trade] is losing points.”  

Winter is coming

If there’s a time to rebuild B2B, and demonstrate the value of travel professionals, it’s now as the busy fall/winter booking season begins.   

Sharing her advice for the months ahead, Clementino urges the trade to focus on driving consumer engagement, continued messaging about the benefits and value of working with a travel advisor, and applying specific knowledge and insights while teasing out new destinations and unique experiences.  

“They can also highlight their expertise when it comes to hurricane policies, travel insurance (why you need it), and of course, the soundest advice as it relates to supplier confidence,” she says.

“Building trust, asking the right questions and listening to every customer to deliver an elevated travel experience will swing the pendulum.”

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