TITLE: INTERNET TRAVEL SALES IN BELGIUM
SUBJECT COUNTRY (IES): BELGIUM
POST OF ORIGIN: BRUSSELS
SERIES: INTERNATIONAL MARKET INSIGHT (IMI)
ITA INDUSTRY CODE: TRA
DATE OF REPORT (YYMMDD): 990802
DELETION DATE (YYMMDD): 000802
AUTHOR: BRIGITTE DE STEXHE
APPROVING OFFICER: GEORGE KNOWLES
OFFICER'S TITLE: COMMERCIAL COUNSELOR
NUMBER OF PAGES: 4
INTERNATIONAL COPYRIGHT, U.S. & FOREIGN COMMERCIAL SERVICE AND
U.S. DEPARTMENT OF STATE, 1999. ALL RIGHTS RESERVED OUTSIDE OF
THE UNITED STATES
The following article, which provides an overview of the travel
sales via INTERNET in Belgium, was published in "Trends
International" of May 1999. The editor of the article is Mr.
Bruno Leijnse. This article is reproduced in its original English
version with the authorization of Mr. Leijnse.
International research points to a worldwide upsurge in Internet
travel purchases over the next five years. In Belgium, though,
there appears to be less enthusiasm.
Major tour operators use all media available when selling their
products, directly or indirectly, by mail order or CD-ROM, or via
call centers. The latest addition to the list is Internet.
According to Forrester Research, the number of trips booked on-
line should rise eight-fold over the next five years reaching
65.6 million. That means an increase from 1.8 per cent of all
trips booked in 1998 to 12.2 per cent in 2003.
But Belgium paints a very different picture. Peter Van Elst,
general manager of Neckermann tour operators in Belgium, says
that the case for Internet has been "seriously overstated for the
sector." Van Elst does, however, promise his company will have a
comprehensive state-of-the-art site for the year 2000. "Internet
is a fundamental part of our strategy," he says, "but we don't
think that in the short term it will be very profitable." Almost
one Belgian in two goes to C&N (name of holding) to book a
holiday, either directly via one of the 85 Neckermann agencies or
their call center, or else via other travel agents and brands
such as Sunsnacks, All Seasons or Pegase. Altogether this made
for 478 million Euro business in the last financial year. And
all that without a single website on the World Wide Web.
"If you had asked me three years ago about our Internet plans, I
would have told you it wasn't on the agenda," admits Peter Van
Elst. "Today it is very much an issue." Neckermann is already
registered as a domain name. Peter Van Elst: "A specific
category of customer will certainly be thinking of the Internet.
Convenience and accessibility are essential to a customer-
oriented approach. The call center is a partial answer, being
open seven days out of seven from 8 am to 10 pm. But Internet
means reservations and information 24 hours a day, whenever the
customer wants it." He is in no doubt that "the great majority of
customers want to have direct contact with a salesperson in order
to get reliable holiday advice." But Internet is one factor, one
possibility within a multi-faceted policy, according to Van Elst.
"I can't change the customer and I don't want to. If he says in
the morning, I want to consult you by Internet - and I'm sure
that will happen - then as market leader I have to be ready.
Otherwise I'm behind the times." The question then is not
whether, but how. And even that is just one step in a process.
"When the call center opened up alongside our own distribution
system, there was quite a lot of opposition. The word was that
it would take away our customers. But it also represented
another way of infor7ning customers. In the end, the Neckermann
Organization has done alright out of it these past two or three
years."
Competitors of C&N are already on the web, but on a limited and
not very sophisticated basis. Jetair (wwwjetair.be) from the
TUI-group was still, as of mid April 1999, largely at the
preparatory stage, but says itself that it wants to provide
business and product information and direct people to a list of
travel agents. Sunjets (www.sunjets.be), the direct sales
channel for the same group, offers a more detailed service: you
can order brochures and a CD-ROM and inquire by e-mail about
availability. Reservations have to made by a 070-number. At
Best Tours (www.best-tours.com) you can calculate approximate
prices and there is an on-line booking form where you can choose
your travel agent. There is a mailing list too. A number of
smaller tour operators, such as Gazelle World Wave, Exclusive
Destinations and EcuTravel, have their own websites but they all
direct you to travel agents.
All in not on-line
Travelstreet.com, the consumer arm of the Gateway company in
Heusden-Zolder, is the most innovative. Valere Vandecruys'
company is neither a tour operator nor a travel agent, but a
business-to-business information provider. The Megatop database,
which lists all available flights and prices in Belgium, is used
by more than 800 travel agents. Only slightly less popular is
Megatour, containing all possible brochures, round trips and
packages, special offers and last minute deals. Gateway has been
working for three years on its Internet service. "We don't sell
anything ourselves. We don't have a license. We want to
centralize what is on offer and be a gateway for the surfer for
everything to do with travel. We try to bring together all the
tour operators we can," Vandecruys says. Forrester Research
predicts that this approach will eventually win out over on-line
booking with individual hotels and airline companies.
GATEWAY is working on an electronic commercial infrastructure.
Until now, apart from travel agents, only small or niche tour
operators have presented their products there, such as Escape,
Intercomfort, Portugal Travel, Enjoy Paradise, Sri Lanka Tours,
Southern Cross Tours and Toboggan Club. But the bookings are
made through travel agents. This is a matter of what is
technically feasible for Vandecruys, "At the moment no interface
is possible with the tour operators' booking systems."
Frank Clarijs, senior project manager at Unisys, comments, "The
tour operators are not technically ready to offer Internet
services." That is partly due to the nature of their work. "The
added value for a tour operator is still above all in the all-out
package of transport, hotel and guides," says Van Elst. Gateway,
for example, does have a booking system for flights which handles
between two and ten bookings a day in April, in cooperation with
the travel agents White Sun, AirStop, IS&TC and Clemens'
Reiswinkel. But tour operating is another kettle of fish.
"Certainly all-in products cannot be booked on-line just like
that. There are various providers involved and they are not all
on one integrated reservation system as with the airlines."
Belgian Travel Network
And yet there is a common reservation system in Belgium for tour
operators. Nine of the big ones, including the top three, sell
their products to more than a thousand travel agencies through
the Belgian Travel Network (BTN). The intranet service dates
from 1996 and avoids travel agents having to have a separate
reservation system for each of their tour operators.
Unfortunately, BTN is not really an integrated system like Sabre,
Amadeus, WorldSpan or Galileo. It is just a gateway. "BTN
exchanges structured messages between travel agents and tour
operators," explains general manager Willem Van Neck. Frank
Clarijs, who oversaw the development of BTN, comes to its
defense: "It's up to the tour operators to make intelligent use
of it." In other words, BTN offers no real overview of what the
tour operators are offering.
So not only do the rules prevent BTN from going on-line as this
is reserved for recognized travel agents, but there are also
technical factors. Although Vandecruys, whose Gateway is well
placed for such a development, still hopes to be able to make the
connection. "Through BTN the consumer would be able to book
online from the big tour operators. I asked them again in March
to be allowed to do this." The answer was no, even though in the
end the reservation would have been through a travel agent.
"There is absolutely no plan to make BTN available on the
Internet," confirms BTN manager Van Neck. That kind of direct
access would represent a revolution and everyone shies away from
it. At the moment, 88 per cent of business in the sector still
follows the classic sequence of customer-travel agent-tour
operator according to Antoon van Eeckhout, founder of the
Association of Flemish Travel Agents, which sees the Internet
more as an evolution in communications technology rather than in
travel selling. "Direct selling would squeeze out the travel
agent," adds Veerle De Boeck, secretary of the Association of
Belgian Air Tour Operators. "We have never dealt directly with
customers and in the short term that certainly won't change."
Apart from their information technology shortcomings there is
another reason why tour operators are slow to go on-line. They
all express doubts as to whether the customer could cope. As Van
Neck puts it: "We are talking here about people who maybe book a
journey once or twice a year. Are they ready to learn the skills
involved? And tour operator A will always operate in a different
way from tour operator B."
Major investment is required to start a site where it would be
easy to book. "We are talking about substantial investment,
millions of Euro," admits Van Elst of C&N. Set against that, the
Internet "will be a medium with relatively low costs." Forrester
Research says the potential savings on running costs are
"dramatic". That could be irresistible in a sector where,
according to Frank Clarijs, "the best work on margins of two per
cent, most on half to one per cent, and many operate at a loss."
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