Driving Costs Out And Bringing Value In

Seema Luthra, Chief Executive Officer, Galileo India, talks about Galileo’s stance on adding value to a travel agent’s business while reducing their operational costs.

The role of a CRS in distributing travel content is now well recognised. As the most efficient way of reaching out to consumers, the CRS is today the obvious choice for distributing and accessing unbiased travel content across the globe. Galileo, for example, reaches out to 193,000 terminal points of 47,000 travel agencies across 115 countries around the globe, bringing to them live content of over 500 airlines, 50,000 hotel properties, 430 tour operators, 31 car rental companies, and a lot more. The figures bear testimony to the popularity of the CRS. Incidentally, Galileo is the largest content provider to the travel industry.

Like in any industry, the business model undergoes a constant churn, and it would be naïve to assume that a successful business model of today will serve the needs of tomorrow. This is even more relevant in the travel industry, which incidentally is the world's largest industry, whose fortunes are closely linked to a host of external factors. And some of these factors have contributed to changing the face of the travel industry almost overnight.

The key to success, and survival for that matter, is for organisations to move away from a vicious cycle to a virtuous cycle. Let me explain this a little further. A company may adopt the strategy of reducing prices to attract more customers. It might succeed in the beginning, with lower yields being compensated for by larger volumes. But what happens when its competitors follow suit, reducing their prices as well. They take the volumes away from the first company, and thus the entire industry is now working at lower yields and the same volumes.

Take the case of another company, which chooses to add value to its customer in a different way. For example, a travel agency offering a 24-hour toll-free helpline for its customers, or remote ticket printing at a customer location, or electronic ticketing facility. These increase the levels of customer satisfaction, leading to more repeat purchases, and word-of-mouth publicity. All this leading to more business. Thus the company has increased volumes without reducing yields, and this is more likely to cover the cost of the value addition.

Having said this, how does one get into a virtuous cycle? The answer lies in driving costs out and value in. Bringing value in will build business, while driving costs out will help preserve yields. And our industry faces this challenge all the while. Travel suppliers, like airlines and hotels, are looking at reducing distribution and operational costs, while increasing the value that they provide to the customers. Similarly, travel agents are working hard to give more to their customers at the same price, while reducing their operational costs.

As a CRS company, Galileo is an integral part of the value chain and recognises the challenges faced by its customers, be it the suppliers or travel agents. And very aptly, our mantra is to drive costs out and value in. Galileo has recognised the need to evolve the travel agent from a mere booking and ticketing entity to a full-fledged travel consultant. We are now orienting our products to help him do that. Viewpoint 3.0, our GUI based booking and reservations tool comes with features like Viewpoint Maps- that helps the travel agent make customised maps for his customer, and e-agent, that offers book-able leisure content to suit his customer's itinerary. The agent can offer tools like ViewTrip or Galileo Wireless-1616 to his customer, to facilitate seamless information flow to the customer, and allow him to be in full charge of his travel plans. Corporate customers can now avail the facility of Satellite Ticket Printing (STP) from their travel agents, which enables a ticket to be printed at their premises itself. These products help the travel agent offer more value to the customer, and open up more revenue streams.

On the cost front, Galileo offers products like Custom Check, which enables the travel agency to monitor quality at the point-of-sale, and thereby minimise errors. Products like ClientFile Plus and Scriptwriter Plus enhance productivity and quality by automating repetitive tasks. Our recent launches of e-ticketing and STP also focus on saving overhead costs, while increasing customer convenience.

Of course, it is not just products that enable agents to save costs. Right from training and supplementary training tools, to a 24X7 help desk, and comprehensive on-site technical support, Galileo ensures that there is no downtime. We clearly recognise that our agents' business is our business!

Galileo's approach has been similar with the suppliers, who are fighting hard to reduce distribution and operations costs. We are the world leaders in e-ticketing, offering the solution to 54 airlines across 43 countries. We are proud to be the first and only CRS to offer this facility to travel agents in India. As per IATA estimates, an e-ticket saves between US$ 8 to US$ 10 per ticket to an airline. The benefit is obvious, and our estimates are that we help airlines save up to US$ 369 million every year through e-ticketing alone. Not only that, it is estimated that an average travel agency in US saves as much as US$ 398,000 every year on overhead costs, by using e-tickets.

Our revolutionary fares offering, Galileo 360O Fares is being rolled out in phases, and will be the most advanced and comprehensive fares solution available. It will take the drudgery out of fares management, both for the airline and the agent.

Having a strong product portfolio, that addressed the needs of the travel agent, it was important for Galileo to ensure that the agents derived maximum benefit. We have therefore taken a well-rounded solutions approach, which ensures that the agent gets the right mix of products and services, according to his needs. This has been backed by aggressive customer contact and awareness programs like the Customer Care Campaign and Advantage Galileo. These campaigns have ensured that the travel agents are harnessing the full potential of Galileo, and giving us valuable feedback for future product developments.

So, what's there in the future for the Indian travel agent? Definitely, a greater adoption of technology, to ensure better products and services, higher levels of customer service, and more efficient operations. And Galileo will be out there, at every step and every new milestone.