When Viking filed for an IPO registration with the SEC, it sparked a discussion about the role of direct bookings versus travel advisors in the cruise industry. In their filing, Viking highlighted the benefits of direct bookings in reducing distribution costs and improving margins, citing their extensive marketing database as a key driver of growth. However, they also acknowledged the importance of the travel advisor channel in generating bookings and expressed a commitment to maintaining and strengthening this relationship.
Zane Kerby, president and CEO of ASTA, raised concerns about Viking’s emphasis on growing direct business at the expense of travel advisors. He pointed out research showing that travel advisors currently book a significant portion of cruises in the U.S., with projections indicating a further increase in their market share. Kerby emphasized the importance of embracing travel advisors as a primary distribution channel, noting that their influence is crucial in a competitive market with multiple options for consumers.
While Viking declined to comment on the issue, Kerby’s public statement prompted a conversation about the potential impact of shifting booking dynamics on the cruise industry. He highlighted the operational costs associated with managing an increase in direct bookings, including hiring more staff and accommodating additional customer service demands. Kerby stressed the efficiency of the travel advisor channel as a proven sales force that operates on a commission basis tied to actual bookings.
Beyond Viking, other cruise lines are also navigating the balance between direct bookings and travel advisors. Windstar Cruises, for example, recently announced a rebranding of their Guest Services department to Vacation Planning, signaling a shift towards proactive sales and personalized vacation planning. This strategic approach reflects the importance of catering to diverse customer preferences and building strong relationships with both direct consumers and travel partners.
As the cruise industry evolves, the debate between direct bookings and travel advisors is likely to continue. Finding common ground between these two distribution channels will be critical for maximizing revenue and maintaining industry growth. While direct bookings offer a streamlined process and marketing advantages, travel advisors play a vital role in driving bookings and providing personalized service to clients. Ultimately, a balanced approach that leverages the strengths of both channels will be essential for long-term success in the evolving cruise booking landscape.