Half of all travel agencies in the Gulf region face going bust in the next three years, if they fail to invest in new online technologies, according to a travel technology expert.
Faisal Memon, CEO of Dubai-based travel technology company Illusions Online said the majority of travel agencies in the Gulf had “zero technology or online presence” and as a result would see a rapid loss of business over the coming few years as a growing number of Online Travel Agencies (OTAs) entered the sector.
“I would say 50% of the companies here will be wiped out,” said Memon.
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“We have seen it happen time and time again. We have seen it happen in America, in Europe, the the UK, Asia and Australia. And in this part of the world it’s just a question of time.”
“If these companies can’t get their act together as far technology and automation is concerned in the next three years; trust me it will be a very different 2015 for them.”
According to Memon, while the traditional ‘bricks and mortar’ travel agencies have been sluggish about investing in online technologies – currently none of the major Gulf travel agencies offer their customers an online booking option – a rash of OTAs are gearing up to invade the sector and steal their market share.
“Every month we get a few calls from different [online] players from around the world – North America, South Africa, Australia, Europe, and they are all are talking about coming to the Middle East and setting up an OTA,” said Memon.
“When that starts to happen you know those are the days when you will start seeing here what we saw in the UK and US a few years ago, which is companies shutting up shop and disappearing. You are not going to have all these companies having a shop in every nook and corner in Dubai.”
“It all boils down to the adoption of technology,” he added. “If these travel companies cannot provide online booking tools to the corporate customers; if they cannot provide online systems for customers; if they cannot have the automation internally within the business to empower their consultants to give the best holiday booking experience to the customer – then it’s just a question of time.”
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