A recent Ask the Experts debate raises some interesting questions about the impact of the internet on Flight Centre. It’s something we’ve been having heated arguments about internally for the past five years and, given the response by members, it seems the views among the wider investment community are just as diverse.
Steve G kicked off the debate with this comment about a recent Flight Centre experience:
“Just some feedback on our local flight centre and why we won’t be going back. We went to a local flight centre to book flights based on a newspaper special. Those particular flights had all sold so we then looked at other deals. The service was adequate, not great, from two of their people – I wouldn’t employ either of them. Perhaps they weren’t trained adequately. The price for comparable flights were much more expensive- we declined and ended up using Jetstar direct via the internet. We saved enough from the flights compared to the flight centre to pay for our accommodation, which we also booked online direct via the accommodation site (we could have booked via Jet star but the same accommodation was dearer via Jetstar’s site). I think more people will gradually move online for travel themselves. Jetstar online service was great/ will definitely re use in future.”
I’ve included the responses below, but what do you think? Does Graham Turner have his head stuck in the sand? There’s no doubt the internet is stealing market share but is there room for both? When I told a friend of mine who runs a Flight Centre store (and historically booked all of my holidays for me) that I’d organised my entire Japan holiday over the internet this year, he shrugged and told me I only used to waste his time anyway. ‘You only ever wanted to book a flight and then organise the rest of the trip on the run, yourself’ he said. ‘I make 90% of my profit from the rich customers who want to book a $30,000 family holiday in Europe without lifting a finger … I’m like a glorified sectretary, and there’s no way the internet can dispose of me’.
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