Skift Take

A lot of this may be corporate-speak, but interesting enough to watch this attempted transformation of a travel giant, and larger lessons for the travel agent world.

Flight Centre, one of the world’s largest travel agencies at $14 billion plus annual revenues, does not want to be called a travel agent anymore. And who can blame it, with the media and consumer battering the agent business gets in face of migration to digital services.

For one, it is changing its name to Flight Centre Travel Group, to convey that it has moved way beyond just flights in the leisure sector (bad margins) and now gets about 30 percent of its overall revenues from corporate travel.

Secondly, it does not want to be called a travel agent anymore, and will kill for it. Sort of. In its latest annual results presentation for analysts day earlier this week, the Australia-based company said it has come up with a “killer theme”: its migration from travel agent to a travel retailer.

The main point: we don’t want to sell third party products, and just be the middle agent, we want to create our own branded products with exclusivity built into those, and become a retailer.

“Being a world class retailer means we are the brand or business people identify with and go to…It is very different from being an agent, a middle man, a dealer for someone else’s product,” the company said in its annual results.

In 2013, almost 20 years into the Internet era, these homilies should be hugely obvious to businesses disrupted by flight to digital, but better late than never. Competitors like Thomas Cook and TUI are going through their own painful transitions, with some variations of this strategy.

Flight Center says it has seven strategic ways it will go about turning itself into a retailer, and those involve product-led thinking, moving from travel agents to experts and gurus, blending offline and online for consumers, reinventing its retail outlets into “hyperstores”, and building a sales and marketing machine behind it all.

Below, we’ve excerpted the relevant parts of the annual presentation, on Flight Center’s journey from agent to a retailer:


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Tags: travel agents

Photo credit: Flight Center-owned Liberty Travel's flagship "hyperstore" on Madison Avenue in New York City. Liberty Travel

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