Apple Leisure Group (ALG) invited travel trade media and a handful of top travel advisors to mark the 1-year anniversary of the merger of Apple Leisure Group and The Mark Travel Group with an intimate lunch in New York City and updates from executives of the six tour operator brands united under the ALG banner.
In explaining the thinking behind the merger, Jacqueline Marks, EVP, trade sales & engagement for ALG Vacations, said that the key motivation was to create an entity strong enough to meet the ever-changing competitive pressures of the travel industry. Together the six brands move 3.2 million passengers a year. “You have the OTA pressures. You have Airbnb and … Google and Amazon. Everybody wants a piece of travel. The new ‘One ALG’ enables travel agents and tour operators to fight back against these pressures.”
She noted that there were growing pains, particularly in merging two different technologies, but moving quickly meant less uncertainty and ultimately less pain and resources are being added both in technology and on the reservations front, and agents are benefiting from the buying power and synergies of the combined companies. At the same time, each brand will retain its own identity and commission structure. Here are some highlights of what was discussed:
Southwest Vacations, which will be celebrating its 30th anniversary on May 14, is now adding Hawaii, said Eric Schueller, Managing Director. “We are now in the process of building awareness. Watch for promotions, sales, webinars and commission offers promoting Hawaii.”
The other big focus for Southwest Vacations is on enhancing the product for agents. Rapid Rewards, the airline’s loyalty program, has a huge customer base and just won a Freddie award for its program. “We want to look into ways for the travel agency group to tap into that… so customers can redeem their points through agents and also earn points on land arrangements,” he said.
Travel Impressions was the first of the legacy ALG brands to go on VAX (the shared booking technology). “It was hard to adapt…but the bumps have smoothed out,” said Scott Wiseman, president. “Everything is being geared to giving you [the travel agent] an advantage for the business over your competitors and it will get easier going forward.”
Among the advantages that the new system offers are an expanded hotel inventory and a direct connection to the inventory of many hotels, which allows travel agents to pick up on the same limited time sale rates offered by OTAs. “Travel agents always turned to us for our breadth of product, but now we can offer even more,” said Wiseman.
United Vacations combines the best prices and policies of United and the buying power of ALG for hotel deals to provide great value, said Jay Seltz, managing director. “Our team has grown the business each year despite setbacks in Mexico and volcanoes in Hawaii.”
United Vacations offers agents an airline seat incentive when booking with the company: for every $50k in revenue an agent books, United Vacations provides a $250 air voucher to the agent. Agents can earn as many as they want and they are combinable.
Apple Vacations is also looking at adding new destinations, noted John Tarkowski, president. The dangers of being so heavily focused on Mexico and the Caribbean became clear when Mexico ran into problems. “We are looking at directions to grow in for 2019 and beyond.”
Knowing the changeover to VAX would be a challenge, Apple Vacations continued using its old system until April 30; group business will migrate on May 24. “That was challenging not just for travel agents but also for our reservations agents. The good news is that soon travel agents will have the best features of both systems.”
Funjet Vacations is also looking into new destinations, said Ron Jacobs, president of Funjet Vacations and Blue Sky Tours. “Funjet has been in business 45 years and there is not another tour operator that has invested in travel agents as much as we have. We have a lot of charter lift and are looking to grow.”
Jacobs, whose background is in finance, said that often mergers and synergies can just mean cost-cutting. “We did cut duplication in some departments, but for ALG, it is about growth. “In January 2017, we began working on integration to ensure it would be the best for both organizations. You are talking about two large institutions that serve 1.6 million passengers each. And to get where we want to be, we need to grow.”
In addition to increased buying power, a big advantage of the combining forces is the ability to innovate Jacobs noted. Technology investments are now spread across all the brands. “With six brands, the technology investment is more justifiable.” Among recent innovations is an email sales tool. “It makes travel advisors look better than an OTA,” he said.
For more information, visit appleleisuregroup.com.