Member Article

The aggregator versus the pure emarketplace

By Chirag Golwala Founder of TripCenter and Lets Travel Services

Like so many industries, the travel sector has been transformed by the digital age. For some time now flight and hotel booking has moved almost entirely online. What once took months from start to finish can now be done in a matter of minutes with the click of a few buttons. Comparison websites make it easier than ever to satisfy the users need to find the best possible deal for their money. Tools such as Google Maps enable consumers to take a walk around resorts, so they can ensure all is to their liking before they part with their cash! All of which has created an expectation and culture of instant service and access.

However there are areas of the travel industry that have been lagging behind in the online revolution. This is a challenge for the group travel organisation sector, particularly when booking ground services. Although many aggregators pose to offer a complete solution, GTOs are often led to submitting forms which quickly take the booking process offline or have the hassle of negotiating with vendors post service for payment.

But change is happening and the challenge for travel agents and GTOs organising tours is how do you determine the value of all the various marketplaces?

All GTOs will be familiar with the aggregator model, even if they don’t realise it. You go to a site and it advertises that it has online coach booking. It may give you a list of all scheduled buses, you may even be able to book through this service but are transferred to another linked site to do so.

One major pitfall of the aggregator market is that they don’t offer a competitive price. When you go to book through them you often pay full retail price like any customer/consumer. A pure emarketplace should have a relationship with all the suppliers with institutional rates which means better margins for the GTO.

The ground services sector is incredibly fragmented, there’s over 50,000 coach companies in Europe. Aggregator models often charge a fee for suppliers to register, this can limit representation. Independent coach operators with less budget may not make it onto the register, leaving a gap between global demand and local supply. A model which instead is free to register creates an opportunity for both the coach supplier to increase visibility and the GTO to access all suppliers. The aggregator is only illustrating some of the landscape of business opportunity.

As a GTO if you are finding yourself in battles over refused payment post service this is another downside to the aggregator model. In a true emarketplace the marketplace becomes the arbitrator, if there is a problem they can negotiate with suppliers. The marketplace prevents a situation or challenge where a business doesn’t get paid. In a pure marketplace when everything is in one place, once services are rendered they get paid.

Outside of a marketplace there is the challenge and time consuming process of ensuring certification of coach companies and tour guides. When self-sourcing, GTOs spend so much time finding suppliers to even fulfil a group tour, that ensuring high quality is a secondary priority. A pure emarketplace saves the GTO time and takes on this hassle of vetting suppliers. This is what sets a pure emarketplace apart from aggregators where this is not clear.

So how can an agent or a GTO be sure they are using a pure marketplace to book ground services including coaches and tour guides for group tours? You can book everything directly live in one place. There is no navigation to another page, no submission of forms with your details and a promise to get back to your enquiry. You can book with all of your suppliers in one place live and there should only be one single point of payment.

This was posted in Bdaily's Members' News section by Katherine Adams .