Flight Centre is shooting itself in the foot

Guest column: Tom Petryshen, from search marketing experts Amplify, says Flight Centre’s stouch with airlines will only drive customers online.

The private war conducted by Flight Centre on major airlines such as Singapore to force them into higher fees will only quicken the demise of traditional, bricks and mortar shops.

With empty seats in abundance even with the current deep discounting, this policy will likely drive consumers into the hands of airlines and other suppliers, especially as consumers realise their choice at Flight Centre will be dictated by the commissions the company receives from airlines.

More than ever, consumers want choice and they want to know that they’re getting the best value for their choice. With Flight Centre staff now directed to avoid certain carriers such as Singapore Airlines, consumers will come to question whether Flight Centre truly have their best interests at heart.

The traditional agent model is not sustainable and will continue to result in more closed shops, especially in tougher economic times. Bullying airlines to pay higher commission may increase revenue in the short term, but will only drive the demise of the traditional shop. What the business needs is innovation, not short-sighted tactics that place the customer worth off.

This stouch with airlines will only push more people online to get the best deal possible and the freedom to book their airline of choice.

Disclaimer: Amplify works with Webjet.

6 thoughts on “Flight Centre is shooting itself in the foot

  • June 1, 2009 at 2:41 pm
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    About time Flight Centre have flexed their muscle It’s a bald & ballsy strategic move by FC which will prove to be the right one. Unfortunatley for the airlines punters are not quite ready to book their international airfairs online, it’s just to hard with stopovers, too many different booking systems, amount of $$$ are just too big to part with over the internet.
    Airlines still need FC to fill their empty seats

    Reply
  • June 2, 2009 at 2:13 pm
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    lol “Disclaimer: Amplify works with Webjet.”

    Reply
  • June 8, 2009 at 8:17 pm
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    I prefer to pay cheaper tickets and accommodation costs – 8% of the total costs go straight to agency?! That’s a lot of money. Might go straight to my overseas shopping budget!

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  • July 18, 2009 at 4:32 pm
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    You think 8% is a lot of money.
    You need to look into the margins of any other retail business. I think you will come to realize that 8% is by far the lowest markup in retail. Did you enjoy paying an extra 40% for those pants you wearing?

    Reply
  • August 4, 2009 at 7:45 pm
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    I should rather have a decent pair of pants rather than having my own money goes straight into the agency. Flight Centre is not that good anyway.

    Reply

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