ABSTRACT
The prevalence of Information and Communications Technology (ICT) facilitated the shift of operations in travel agencies from traditional to online platforms in the same way that the Internet changed how customers can access goods and services. The Internet enables customers to gain access to online travel agencies and choose to purchase travel-related products and services online. Nevertheless, previous studies prove that online travel agencies are finding it difficult to compete with one another and the adoption of ICT as a major part of operations present other problems that set barriers for the growth of online travel agencies. The widespread use of smartphones and other devices to access the Internet, however, present opportunities for travel agencies to target specific market segments. In the research, the primary objective is to determine trends and patterns in consumption and study practices and strategies in online travel agencies in Macau to arrive at recommendations that would help these agencies thrive in a competitive environment. Data were obtained through
quantitative research and the administration of survey questionnaires among travel agencies and customers. The results of the study revealed that majority of the customer prefer to purchase travel-related products and services from traditional travel agencies, possibly because they do not own credit cards and are hesitant to use them due to security concerns. Moreover, customers use their smartphones or access the Internet through other means to obtain travel-related information. The findings suggest that online travel agencies should capitalize on what customers find appealing about online services and look for ways to make online travel-related products and services more appealing than those offered by traditional travel agencies.
- Background
The rapid development of Information and Communications Technology (ICT) paved the way for a series of changes in different fields and disciplines. In global tourism, ICT changed the way businesses managed transactions with customers and brought about the development of e-tourism (Marshall, Taylor & Yu, 2006, p. 176; Sola, Jafari, & Da Silva, 2012, p. 34). Many businesses sought spaces online to extend their services to foreign clients. In the travel agent sector, many travel agencies decided to create online counterparts and extend services to netizens. Consequently, the number of online travel agencies grew “due to the impact of ICTs and new forms of intermediary and distribution electronically on the conventional high-street travel agent” (Page & Connell, 2006, p. 146). If the current conditions of the travel agent sector inform upcoming trends, studies predict that travel agencies will dominate e-tourism online, thus, increasing competition and lowering cost of services to meet the needs of mass markets around the world. Services offered by travel agencies will also evolve to accommodate the changing needs of travelers based on their increasing use of mobile devices such as smart phones, laptops, and tablets (Page & Connell, 2006, p. 146).
Travel agencies utilize ICT to manage organization and perform operations. Selected softwares, for instance, allow travel agents to create comprehensive or detailed itineraries for clients, create and update schedules and to-do lists, and provide lists of available services, cost, and similar data (Pease & Rowe, 2007, p. 55). ICT also assists travel agencies in advertising and marketing. Many travel agencies create electronic brochures, which they can easily distribute through online channels such as social networking sites (Papatheodorou, p. 165). While some rely on traditional forms of advertising and marketing, some travel agencies use ICT relentlessly through online advertisements constantly running on social networking sites or search engines, online referrals, emails, and viral videos, among others (Middleton & Clarke, 2012, p. 43). Travel agencies also utilize ICT to conduct marketing research. ICT has made it easy for travel agencies to obtain information just be observing trends online. In social networking sites alone, online travel agencies can determine the interests and preferences of specific populations in travel just by looking at audience rate and viewership of travel blogs, Facebook fan pages, Twitter hashtags and accounts, and online discussions. Data or information would allow travel agencies to make proper decisions to make their services and offerings appealing to their target market segments (Middleton, Fyall, Morgan & Ranchold, 2009, 76).
Travel agents and agencies can perform several tasks using ICT but the most important operation they can perform with technology is online reservation, through which clients or customers could make reservation, and arrange or schedule other important parts of their travel experiences. Travel agents could also issue important travel documents to their clients online, which make it simpler and easier for them to close deals and finalize travel details (Pease & Rowe, 2007, p. 55). To deliver comprehensive services, travel agencies access various distribution systems. In transportation, travel agencies access distribution systems for air (e.g. airline companies), land (e.g. railway stations, rent-a-cars), and water (e.g. cruise liners) travels. Travel agencies also tap into distribution systems for accommodations (e.g. hotels, motels, inns) and travel or tours (e.g. tour schedules, operators, guides). ICT expanded access of online travel agencies to these distribution systems, allowing businesses to offer comprehensive services to clients (Kuom & Oertel, 1999, p. 225).
Although most travel agencies developed online portals to manage operations in cyberspace, current research studies prove that businesses fail to maximize ICT to improve the delivery of services. One of the primary issues surrounding the failures of travel agencies is their lack of strategic vision and direction in using ICT. Other agencies also neglect the importance of ICT and limit spending on virtual services, networks, and ICT infrastructure (Pease & Rowe, 2007, p. 55). “This result in a relatively low level of technology integration, and thus less information is available to support strategic and tactical decision-making” (Pease & Rowe, 2007, p. 55). Moreover, the limited use of ICT also limits the capacity of travel agencies to improve management and operations, consequently lowering the quality of services they offer to clients.
The heavy reliance of people on online transactions presents opportunities for travel agencies to extend their services in the virtual world. Nevertheless, offering online services similarly presents a variety of challenges. For one, travel agencies must develop strategies to compete with well-established online tourism companies such as Travelocity and Expedia. These companies integrate services to allow users to access a variety of information about transportation, accommodations, and destinations (Pease & Rowe, 2007, p. 55). Considering the capabilities of online tourism companies, travel agencies must learn to catch up but with a price. Aside from spending on networks and ICT infrastructure, travel agencies must also train its staff to perform their roles and responsibilities using technology, spend on online security, and integrate services to various device platforms.
ICT has undeniably changed the landscape of the travel agent sector, improving the quality, reach, and delivery of services and offerings. Aside from making offers attractive to customers locally and internationally, ICT allows online travel agencies to access various distribution systems, communicate and address the concerns of customers directly, reduce cost through direct sale, obtain relevant data about the market, and increase distribution through advertising and marketing (Kuom & Britta, 1999, p. 229). Nevertheless, online travel agencies must handle the risks and threats of competing with established travel agencies online and investing in ICT networks and infrastructure while providing their clients access to e-tourism services.
Since the outcomes of ICT could both be positive and negative on the part of online travel agencies, the primary aim of research is to determine the impact of ICT on travel agencies and address the question of whether online travel agencies are risk takers for investing in ICT and establishing their business in the saturated virtual environment, or credit absorbers that provide customers or clients access to e-tourism services through online channels. To narrow down the scope of research, the study will focus on Macau-based travel agencies. Data will be obtained through quantitative research. Initially, data and information will be obtained from primary and secondary literature to establish the foundation of the study in the review of related literature. Consequently, the quantitative research method will be employed to gather data about travel agency products and services online and the current trends in travel and tourism from physical and online travel agents and agencies based in Macau and customers. Quantitative data will be gathered through the survey method and the participation of travel agents and customers and will be analyzed using descriptive statistics. The results of research are expected to contribute to existing literature about online travel agencies but within the context of e-tourism in Macau. The findings will inform strategic development and decision-making in travel agencies in Macau, especially with regards to ICT use and integration in management and operations.
- Statement of the Problem
The integration of ICT to practices and strategies in travel agencies raise various issues regarding the position of travel agencies in a competitive environment and the abundance of opportunities for travel agencies to improve the quality of services and the delivery of these services to end users. As previously discussed, the heavy reliance of customers on the Internet to conduct transactions increases the need for travel agencies to offer services online. Nevertheless, integrating ICT to services presents risks for travel agencies due to the challenges and difficulties in investing or spending on ICT networks and infrastructure, training human resources to use ICT, and linking services and distribution systems online. Despite the risks and problems linked to the integration of ICT in travel agency service delivery, ICT offers solutions and improvements for travel agencies. Aside from increasing reach to end users locally and internationally, ICT also helps travel agencies perform significant tasks and operations online, implement advertising and marketing strategies, and conduct research to inform decision-making and strategic development. The gap in implementation, however, is influenced by the manner in which travel agencies utilize technology. Some travel agencies use ICT to perform operations efficiently by increasing direct communication with clients or accessing a variety of distribution systems, while others fail to realize the full potential of ICT in management and operations, consequently placing their business at risk for failure.
Decision-making in online travel agencies is also heavily influenced by the interests and preferences of customers. If, for instance, customers prefer to travel by air, then travel agencies must have access to distribution systems in airline companies. If majority of customers want to travel to Europe, then travel agencies must link services to local tour operators and guides in European countries. The type and scope of services, therefore, should be fashioned after customer needs and demands.
In conducting the study, the researcher aims to address the aforementioned problems by studying the case of travel agencies in Macau to determine how ICT changes or transforms the type, quality, and delivery of services. In doing so, the research study could also be used to determine how travel agencies in Macau use ICT in management and operations, and whether ICT improved the quality and delivery of services to clients or end users. To extend the scope of the study, research will also be conducted to determine the preferences and interests of customers, not only in travel but also in the use of ICT to access services offered by travel agencies.
- Research Aims and Objectives
The primary aim in conducting research is to determine the impact of ICT on travel agencies through the exploration of current practices and strategies in Macau-based travel agencies. The research study also aims to address the following research objectives:
- Relevance of the Study
Primarily, the research findings will provide information about the current conditions of travel agencies in Macau. By comparing the features of offline and online travel agencies in Macau, the research study would highlight the advantages and disadvantages of both service delivery platforms. Moreover, doing so would introduce the benefits and contributions of ICT on the delivery of services among travel agencies. Data and findings linked to these types of information would inform travel agencies in Macau, especially in deciding or choosing to use ICT or not. The data and findings will also contribute to existing literature, which travel agencies in Macau and around the world could use to determine if they could integrate ICT in their business model and if they can take advantage of ICT to improve their services.
The research findings will also help travel agencies avoid the risks and threats in adopting ICT and compete with other online travel agencies. As previously discussed, one of the problems associated with the use of ICT in travel agencies is the lack of strategic direction to realize its full potential. Studying how Macau-based travel agencies use ICT in management and operations could provide information about best practices in running online travel agencies. The examples gleaned from practices, approaches, and strategies of travel agencies in Macau could be used to create or develop a system of integration and implementation that travel agencies in other countries could adopt to realize the full potential and take advantage of the benefits and contributions of ICT in the travel agent and e-tourism sector. The research findings could also inform travel agencies about the proper integration of ICT in their business model, and organization of management, services, and operations in a way that would cultivate operational efficiency and positive outcomes.
Customers will also participate in the study. Through survey questionnaires, customers will be asked to provide information about their interests and preferences, specifically their preferred mode of arranging and scheduling transactions, device and software platforms, network and technology needs and demands, and the rate or frequency of technology use. The information obtained from customers will be used to determine what online travel agencies in Macau should offer to target market segments. The responses of customers would also provide information about the current conditions of traveling and tourism and how these trends would shape the future of offline and online travel agencies.
- Summary
ICT has significantly changed the business landscape for travel agencies. By integrating ICT to business processes and operations, travel agencies could optimize services and extend their reach to end users locally and internationally. ICT also allows travel agencies to fulfill tasks and operations, advertise and market to target segments, and conduct research. Nevertheless, travel agencies could also be taking risks in adopting ICT, especially because of the challenges associated to investing in ICT networks and infrastructure and the problems that would arise from improper and disorganized implementation. Through the research study, we could determine how travel agencies could obtain the benefits and contributions of ICT while preventing known risks and threats. Quantitative research will be employed to obtain data from travel agencies or agents, and customers. The findings are expected to inform decision-making in travel agencies and management of online travel agencies. In Chapter 2, the information, issues, and problems previously discussed will be explored further through a thorough discussion of existing literature about the topic. In Chapter 3, the research methodology and design will be discussed in detail. Chapter 4 will constitute the data that will be obtained through research and the findings as results of analysis. In Chapter 5, the conclusions and recommendations of online travel agencies in Macau and other parts of the world will be discussed.
2.1 Introduction
The review of related literature constitutes the foundation of the research. The literature review is an in depth assessment and analysis of existing literature – primary or secondary – that say something about the research topic. Moreover, existing literature provides significant data about theories, models, and concepts that would aid in constructing the research and later on, in interpreting data that will be gathered through the planned research methods. In a way, the review of related literature establishes the framework of research by offering opportunities to identify parts of literature that can support research, the gaps in literature, and parts of the research that can fill in these gaps. The discussion in the literature review will also contribute to the fulfillment of some research objectives including:
The aforementioned research questions will be addressed throughout the literature review. The following literature review will cover all the concepts in the research – the conceptual framework of the study, the role or function of travel agencies, the difference between offline and online travel agencies, Information and Communications Technology (ICT), the impact of ICT on the travel and tourism industry, and how the interests and preferences of consumers nowadays influence the decision of travel agencies to adopt ICT.
2.2 Conceptual Framework
ICT contributes to changes to a variety of fields, from business to communication, education to health, and in this case, travel and tourism. In the research, the primary objective is to determine the impact of ICT on the roles, functions, and practices in travel agencies, specifically online travel agencies. The link between ICT and travel agencies could be traced to e-tourism as a conceptual framework. E-tourism as a conceptual framework postulates that the use of ICT and the development and implementation of ICT policies and strategies are critical to shaping attractive tourism destinations, sharing tourism information to millions of potential customers worldwide, and to gaining economies of sale (Finger & Sultana, 2012, p. 59). The conceptual framework is best represented.
At first, the development of tourism policies must be guided by goals and objectives that would spell success for businesses and companies in the tourism industry. Goals and objectives include economies of sale, the need to share information to larger networks, and to implement effective marketing and advertising strategies. Often, goals and objectives are related to marketing or advertising and increasing tourist interest in a single tourist destination. To accomplish these objectives, businesses and companies could implement traditional strategies but could also use ICT to boost e-tourism strategies and practices. In this stage, ICT policies must merge with tourism policies through ICT inclusiveness that is the application of ICT in all areas of management, operations, and delivery of services. ICT, for instance, could help businesses and companies accomplish economies of sale by expanding the company’s reach globally through social networking. Similarly, businesses or companies in the tourism industry could also use social networking to share information and to implement marketing and advertising strategies. E-tourism as a conceptual framework generally endorses the need to integrate ICT in all activities within the tourism industry, especially in processes related to information dissemination and communication (Finger & Sultana, 2012, p. 61). The e-tourism conceptual framework illustrated in Figure 1 and discussed previously also shows how ICT is integrated in goods and services offered by travel agencies. As previously discussed, the e-tourism conceptual framework underscores the importance of ICT as a means to share information about traveling and tourism and communicating with existing, potential, and emerging target markets.
The framework discussed by Newton (2008, p. 107) represents ICT as a global trend that influences decision-making in businesses or companies in the travel and tourism industry. According to Newton (2008, p. 107), the business landscape surrounding all industries, including the travel and tourism industry, is shaped by economic, political, social, environmental, and technological megatrends that change over time, and these factors will affect the upcoming trends and the context of global tourism in the coming years.
Technological developments such as ICT influence the destination by defining how companies, businesses, stakeholders, and communities could manage target destinations. Destination management as a concept refers to practices, approaches, and strategies geared towards the development of a destination’s competitive advantage (Wang, p. 1). Since the competitive advantage of any destination relies on the satisfaction of guests or tourists, destination management focuses on the development of goods and services attributed to the destination that ideally meets the standards and expectations of guests or tourists. “Destination management and marketing is the consistent orientation of tourist services and service providers towards the needs of potential guests” (Leslie & Sigala, 2012). In practice, destination management specifically refers to the process of developing and offering brands, products, and services that would best meet the needs of guests or tourists (Conrady & Buck, 2008, p. 110). Travel agencies or agents act as the go-betweens between the guests or tourists and the companies or brands that offer competitive products or services. Travel agencies are known as the distribution channels through which guests and tourists could subscribe to what destinations could offer. Within this context, travel agencies or agents utilize ICT to spread or share information about available products and services that guests or tourists could experience at a specific destination. Online travel agencies, for instance, collate a list of hotels, motels, and inns located within a specific destination and share information about the goods and services that these tourism establishments have to offer. Online travel agencies aim to compete with other agencies by selecting content to share, especially the kinds of information that guests or tourists would find useful.
Apart from destination management, ICT also influences tourism as an enterprise. While destination management refers to the management of destinations to gain competitive advantage (e.g. the construction or development of airports, hotel establishments, and recreational facilities, etc.), enterprise management refers to the management of the enterprise, business, or corporation as a way to gain competitive advantage (Ateljevic & Page, 2012, p. 170). Moreover, in destination management, the objective is to make the destination more appealing to guests or tourists but on the contrary, in enterprise management, the objective is to gain competitive advantage as a business over the competition – hotels competing with other accommodation establishments or in this case, travel agencies competing with other travel agencies. Enterprise management practices refer to internal practices and operations that affect delivery of services, and within this context, ICT makes a difference in the quality of delivery between offline and online travel agencies. Travel agencies could use ICT as a competitive advantage to boost internal operations, improve delivery of services, and reach wider markets. Expedia, Orbitz, and Travelocity are three of the leading online travel agencies. The practices of these agencies offer a quick glance of how ICT could leverage management, operations, and competitive advantage in travel agencies. Expedia, Orbitz, and Travelocity offer wide-ranging information that tourists or travelers would need to make travel decisions – information about accommodations, airlines, and transportation, among others (UNCTD, 2005, p. 1984). Nevertheless, smaller online travel agencies compete by using ICT as a medium to share information and communicate with guests and tourists while reducing cost of services by working directly with accommodations, airlines, and transportation service providers and eliminating third parties that would add cost of services (UNTCD, 2005, p. 1984). Efficient enterprise management for travel agencies would therefore depend on how well they utilize ICT to reach out to target markets and to deliver services directly from service providers. In a way, the use of ICT in travel agencies necessitates strategic development and implementation.
One of the most notable information gleaned from Newton’s (2008, p. 107) framework of mega trends and the tourism industry is the impact of technological developments on tourists. Technology primarily offers convenience and entertainment. Consequently, tourists and guests would more likely subscribe to services that offer them convenience and entertainment with the prevalence of devices or gadgets with these features. In a research study conducted by Tsiotsou, Mild, & Sudharshan (2012, p. 35), the researchers identified three technological trends that affect the behavior of tourists or guests: (a) people frequently use the Internet to search for and share information about destinations and services, (b) people subscribe to social networks, and (c) people often share “tourism experiences” (e.g. vacation photographs, videos, and reviews, etc.) online. Apart from these trends, tourists and guests also utilize a wide range of devices to access travel information online, including smartphones, laptops or netbooks, and tablet devices. Therefore, customers value access to real-time information and experience sharing platforms. Businesses including travel agencies must not ignore how technology is shaping how human beings act, behave, communicate, and learn. The impact of technology on customer behavior alone should be enough to help travel agencies grasp the importance of adopting ICT.
The conceptual frameworks discussed in this section of the literature review highlights how technological developments, and ICT specifically, contribute to global tourism and the tourism industry. It is important to note that technology is a trend that shapes how businesses and companies, including travel agencies, grow or develop in the tourism industry. Since technology pervades every aspect of tourism, from the management of the destination, management of the enterprise, and the decisions, interests, and preferences of customers, businesses should take cues from technological trends and developments. Consequently, the services offered by travel agencies are influenced by trends in destination management, enterprise management, and tourist or customer behavior. The conceptual framework also illustrates how travel agencies could use ICT to perform roles and functions. Considering the roles and functions of travel agencies, these establishments could take advantage of ICT by using technology to share information and communicate with partners or affiliates and customers or guests.
The conceptual framework plays an important role in contributing to the foundations of the research study. From the concepts previously discussed, we have gathered the value and influence of ICT on tourism and discovered how these consequently affect practices, strategies, and approaches in travel agencies. Furthermore, the conceptual framework proves the important role that ICT plays in shaping practices and strategies in travel agencies, and therefore, must not be discounted when assessing or evaluation, analyzing, and studying the structure of travel agencies. In identifying how ICT affects travel agencies, we may briefly address some of the research objectives - the impact of ICT on travel agencies and the implication of ICT on practices in travel agencies. While the impact of ICT on travel agencies presents opportunities for product and services development, the implication of ICT on practices underscore how travel agencies can utilize ITC to their advantage.
2.3 The Role of Travel Agencies
The travel agent is the intermediary between the service providers the travel agency caters to and the customers and is responsible for selling the goods or services that service providers offer for customers. Leuterio (p. 77) also defined the role of the travel agent in many ways. In the marketing context, the travel agent is the middleman “acting on behalf of the client, making arrangements with suppliers of travel (airlines, hotels, tour operators), and receiving a commission from the suppliers”. Therefore, all travel agents working for their respective agencies must be aware of the kind of services accessible to customers, preferably to customers from different market segments. In this way, the travel agent would be able to cater to the customers’ every need (Wensveen, 2007, p. 268). It is the responsibility of travel agencies to select service providers that would provide the best services to customers and consequently, recommend these services to customers who are planning to go on trips or vacations. Travel agencies gain revenue by receiving commission from service providers when they successfully recommend the goods or services offered by a service provider. The customers also pay a small fee to travel agencies for their recommendations (Mak, 2004, p. 42). After discussing options with the customers, such as agreeing on accommodations, airlines, and transportation arrangements, the travel agency is then responsible for arranging all services with the service provider, creating a schedule and an itinerary for the customer, and organizing all aspects of travel to guide the guest or tourist and ensure quality and satisfying tourist or travel experiences (Reif, Ditterich, Larsen & Ostrea, 1997, p. 129). The role or function of the travel agency is best represented by the supply chain model.
The exchange between the customer and the travel agency is transparent. While the travel agency is responsible for making recommendations to the customer, the customer’s needs, demands, and feedback, on the other hand, helps the travel agency make decisions about the kind of services to carry and recommend for customers. Figure 3 also shows the need for travel agencies to have access to a series of service providers so agents can make valid and reliable recommendations of service providers that also provide quality services for customers (Kim, Lee, & Tanaka, 2012, p. 276).
2.3.1 Traditional vs. Online Travel Agencies
Travel agencies in the contemporary world evolved due to the expansion of roles and responsibilities that they can take on. It used to be that traditional travel agencies merely provided what customers asked for. If a customer, for instance, want to visit a specific place, the travel agency informs the customer about travel experiences, often parts of a travel package, and let the client make a choice. Nevertheless, travel agencies today are more responsive due to the diverse needs of customers. Travel agencies now do not merely list what services or experiences customers can choose from but also offer good recommendations that would contribute to the quality of the travel experience. Specialization is a key component of modern travel agency transactions because travel agents work with customers to provide specialized services that would suit the latter’s unique travel needs and demands (Bhatia, 2006, p. 227). Traditional travel agencies also used to have limited access to service providers. However, with the increasing competition due to the prevalence of online travel agencies, these establishments have realized the importance of establishing partnerships and connections with a variety of service providers. Doing so is easier for online travel agencies because networking and semantic technologies allow travel agencies to access information (e.g. hotel vacancies, flight schedule and vacancies, tour operations, etc.) in different countries and in real time for customers (Reif, Ditterich, Larsen & Ostrea, 1997, p. 129). Online travel agencies can also eliminate third parties by working directly with service providers to offer services to consumers. The Internet also allows easy access to plans and allows customers to directly arrange or cancel plans in real time.
Despite the ease of use and accessibility that online travel agencies offer to customers, traditional travel agencies also have advantages that online travel agencies cannot offer. Some customers still prefer to conduct business face to face, which means that these types of customers would rather visit travel agencies to make arrangements and ask for recommendations. Customers who desire personal interaction dislike the impersonal nature of making transactions online. Furthermore, customers also argue that in online travel agencies, they cannot ask questions or clarifications regarding travel information. Customers feel reassured when they see who they are transacting with. Nevertheless, the downside of working with travel agents in traditional travel agencies is that consultation would more likely cost more than the free services that online travel agencies offer. Table 1 illustrates the differences between traditional and online travel agencies.
The conceptual framework proved the impact and implication of ICT on travel agencies. Essentially, the rapid development of technology and ICT contributes to the evolution of practices, approaches, and strategies in the tourism industry. For travel agencies, ICT allows these businesses to share information and communicate better and consequently achieve competitive advantage. ICT has significantly improved the business of travel agencies and made their services dynamic. One of the most prominent features of online travel agencies is exchange of information. While online travel agencies offer a variety of travel information to customers in real time, travel agencies can also glean information about customer behavior, preferences, and interests. Social networking platforms, for instance, have made it possible for businesses to determine what customers want and need, what they usually share with their family and friends, and what websites they usually visit. Online travel agencies can use data obtained from customer experiences and “footprints” online to make crucial decisions about their customer service approaches, services, management strategies, operations, and delivery (Pender & Sharpley, 2005, p. 241). ICT also allows travel agencies to operate independently and eliminate third parties to lower the cost of services, while maintaining their core services of sharing information and communicating with customers. In terms of access, ICT has also contributed to customer access to travel agency services. Overall, ICT has contributed to all aspects of the travel agency as an enterprise. In management, ICT allows travel agencies to manage customer information digitally and link to service providers in real time. In delivery of services, ICT also allows travel agencies to delivery information and data to customers in real time, while allowing them the opportunity to make informed choices regarding their travel plans. In terms of operations, ICT allows travel agencies to conduct its core services, which includes marketing and advertising, research, and communication and information dissemination.
2.4 ICT and Customer Behavior and Needs
As previously discussed in the conceptual framework, the use of ICT is not merely an emerging trend in tourism practices and strategies even in travel agencies, but a necessity in business strategies and practices because majority of the industry’s existing, emerging, and potential markets now rely on technology to make travel transactions. In a study conducted by Conrady and Buck (2008, p. 119), the researchers conducted a survey among travelers to determine what mediums or platforms they consult when making travel decisions. The options in the survey include the online travel agency, Internet search engines, the actual websites of service providers (e.g. hotels, airlines, etc.), travel search engines, review sties, or other sites. From the analysis of data, Conrady and Buck (2008, p. 119) discovered that 74 percent and 81 percent of the sample population in the study consult online travel agencies in 2007 and 2008 respectively. Another notable result of the study is that the majority of the sample population relies on online travel agencies as opposed to other options, including the actual websites of service providers. The results of the research study also proved that apart from making decisions, majority of the sample population consult online travel agencies to plan their trips first. Furthermore, majority of the sample population visit online travel agencies first prior to planning instead of other sites such as review websites and travel search engines (Conrady & Buck, 2008, p. 119).
Apart from helping customers make decisions and plans, customers also use ICT while traveling for updates. Due to the prevalent use of portable or mobile technological devices such as smartphones, netbooks or laptops, and tablet computers, people can access the Internet wherever they are with the availability of an Internet service provider. In a study conducted Choi, Lehto, and Oleary (2007, p. 5), the researchers sought to determine what Canadian tourists want to obtain from tourism websites, such as destination marketing organizations (DMO) including travel agencies. In the study, Choi, Lehto, and Oleary (2007, p. 5) conducted a survey among Canadian tourists to understand their perspectives and behaviors about DMO websites. The results of the survey revealed that majority of tourists consult online travel agencies initially when they are making decisions about travel and during the early stages of planning their trips. Another notable result of Choi, Lehto, and Oleary’s (2007, p. 66) research study is that majority of tourists visit the Internet to make travel arrangements, from booking tickets at airlines to accommodation, mapping, planning activities and events, reading about people, culture, weather, and destinations of specific places of interest, reading about reviews from other people, and other information about traveling and the destination. The research study plays an important role in helping travel agencies develop and deliver services because the results prove that travel agencies must provide information crucial to decision-making and planning, and that they must also offer a considerable wealth of relevant and reliable information to engage customers continuously (Choi, Lehto, & Oleary’s 2007, p. 68).
The heavy reliance of customers on consumer gadgets to plan and make decisions also suggest that tourism businesses and companies like travel agencies must not only increase their presence online but also take advantage of various communication channels and platforms to reach out to customers. Most smartphone devices today are equipped with travel and tourism applications that allow them to check flights and accommodations online, check routes and follow maps, and even plan or organize their trips through calendar and notes. Travel agencies should be able to take advantage of this opportunity be creating accessible applications through which they can share information and communicate with customers. Cao and Tuan (2011, p. 95) explored how people make use of their mobile phones to draw and access travel information. Cao and Tuan (2011, p. 95) consulted existing literature and discovered that tourists have increasingly used their mobile phones to access travel information, itineraries, and notes. For this reason, Cao and Tuan (2011, p. 97) introduced a mechanism through which tourism businesses and companies like travel agencies could adopt should they decide to make their services available in mobile platforms. Cao and Tuan (2011, p. 99) pointed out the importance of integrating meaning to the services that travel agencies could offer in mobile platforms. Travel agency applications should, for instance, not merely draw or collate information from search engines but specifically respond to the queries or concerns of tourists who use their mobile phones. Context is very important when constructing online spaces and applications through which customers can draw travel information. On this note, Cao and Tuan (2011, p. 99) recommended semantic technologies for travel agencies and other tourism businesses that are planning to introduce their services in mobile platforms.
2.5 Summary
In the literature review, the conceptual framework contributed to the foundation of the research study. While the impact of ICT in changing the business landscape of the tourism industry cemented the relevance of the research study, the implications of ICT on practices, strategies, and approaches in travel agencies underscored how travel agencies may take advantage of technology to gain competitive advantage. Moreover, the conceptual framework also highlighted the value or use of ICT for travel agencies – a means of sharing information and communicating with customers. Apart from the conceptual framework, the literature review also covered a brief background of the travel agency, the difference between traditional and online travel agencies, the impact of ICT on online travel agencies, and the influence of technology on the behavior, preferences, and interests of customers. The content of the literature review addressed some of the research objectives and the information gleaned from existing research will be used to support the data that will be obtained through the research methodology. The research design, methods, and instruments will be discussed in Chapter 3.
