German retail agencies are hungry for fresh opportunities

Germany’s retail trade and small tour operators, if marketed to correctly, could play an increasingly important role in growth out of this market.

Reinhart Mecklenburg of Afrosales in Germany, says while the “Big Four” of TUI, Thomas Cook, Dertour and FTI control the lion’s share of outbound travel, they tend to compete on price, leaving a gap for innovative smaller business to tap into segments of the market more interested in high quality authentic experiences.

Speaking in a discussion focusing on German-speaking Europe at the recent SATSA Conference, Mecklenburg said: “The big four tour operators control 65% of the total volume of packaged travel worldwide out of Germany and are here to stay. However, the smaller players are looking for small partners in South Africa and prefer high touch over high tech.”

The retail travel trade, who consult directly with the customer, are also getting more involved in the tour operating side of things, as a result of the new EU travel directive. The legislation now extends to retail travel agencies, as well as OTAs, meaning they have exactly the same liabilities as tour operators. “Since they now have to take on additional risk, some retail agencies have decided to just do their own thing and act as tour operators,” he said.

“These agencies are producing longer 19-day packages as they hate rushed itineraries,” said Mecklenberg. “Slow travel is the big trend and will be promoted by the smaller agencies.”

Dinky Malikane, Global Manager: Watchlist Unit at SA Tourism, agreed that authentic quality experiences are very much in demand. “We have identified eight million potential travellers to cover in the medium term in Germany. Currently we’re getting 250 000,” she said. Family travel was also identified as a big trend.

Aside from the visa regulations, there are relatively few obstacles preventing Germans from travelling to SA. Michael Bentele, SAA’s Head of Europe, said the favourable exchange rate and pent-up demand from 2015 has contributed to the positive growth seen so far this year. “We also have sufficient air capacity out of the three German-speaking markets (Germany, Austria and Switzerland). There are 18 carriers flying from these markets via hubs and four non-stop carriers. This means there are 2.7 million seats per annum, of which 500 000 are non-stop seats,” he added.

“South Africa has competition, but it’s not Botswana, Namibia or Mozambique. It’s the US, Canada, Brazil, Thailand and Australia. If we want a bigger share of the long-haul market then collaboration in marketing is very important. If SAA, tour operators and suppliers are not working to create a buzz, then no one else will,” he added.