Do travel agencies provide sufficient value to their clients ?

Catenazzo, Giuseppe ; Fragnière, Emmanuel

Airline commissions’ cuts and the use of Internet for reservations have severely affected Swiss travel agencies. To survive, travel agents are redesigning their job as to become travel consultants. However, customers are not willing to pay for the service provided and current fees are not representative of its perceived value. We have designed a theatre-based experiment to discover the... Plus

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    Summary
    Airline commissions’ cuts and the use of Internet for reservations have severely affected Swiss travel agencies. To survive, travel agents are redesigning their job as to become travel consultants. However, customers are not willing to pay for the service provided and current fees are not representative of its perceived value. We have designed a theatre-based experiment to discover the Willingness-To-Pay for a travel agency experience. Results show that individuals are not willing to pay anything for an unpleasant experience. By contrast, only 1/3 of the sample would pay enough for an outstanding service experience to make such a business sustainable.