This month when I saw the ARC segmentation statistics, I just had to post the chart, all by itself, without the legend. If you take off the axis titles, it actually reminded me of a string art project that I did in grade school.
For those not familiar with ARC, it is the Airlines Reporting Corporation and it deals with the online and offline agency community as it relates to air ticket sales. The players are travel agencies, including the online players, the mega agencies and all “other” agencies. One line on the graph is the aggregate of the three. And to further confuse matters, the corporate division of one of the OTAs moved from the OTA category to the mega category in February 2012.
Before you page down to get the “rest of the story”, let’s just look at the patterns.
- The “green” player is struggling and did not enjoy the same spike in October and November
- The “red” player started the year strong, but was outpaced by the “yellow” player in the last quarter of 2012
- Without looking, I’m guessing that the “blue” player is actually the aggregate
Can you guess who is who?
Page down.
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If you thought it was the brick and mortar travel agency community that was struggling, you would be wrong. It was the OTAs. And the mega agencies (boosted by Expedia’s Egencia joining the category) had the best 4th quarter of all of the three categories.
Overall, the combined group of agencies spent more months below the 0% growth line than they did above.
But the death of the agency channel is still wildly overstated.
As of January 2013, there were still 13,455 agencies, including the OTAs. In January these agencies produced $6.1 billion in sales. Out of the $6.1 billion, 18.13% was from airline fees (also known as ancillary fees).
And now you know, the rest of the story.