Distribution Channels in Tourism

NAICS

Classification system for North American industries.

Travel Services

Businesses assisting with planning visitor experiences.

Accommodation

Lodging options for travelers during trips.

Adventure and Recreation

Activities providing excitement and leisure for tourists.

Attractions

Sites or events drawing visitors for enjoyment.

Events and Conferences

Gatherings organized for specific purposes, often business-related.

Food and Beverage

Culinary services offered to travelers.

Tourism Services

Support services enhancing the travel experience.

Transportation

Means of moving travelers from one location to another.

Travel Trade

Industry segment focused on selling travel products.

Travel Agencies

Businesses helping customers plan and book trips.

Online Travel Agencies (OTAs)

Websites aggregating travel products for booking.

Tour Operators

Companies offering packaged travel experiences.

Destination Marketing Organizations (DMOs)

Entities promoting specific locations to attract visitors.

Direct Sales

Selling products directly to consumers without intermediaries.

Online Platforms

Websites for booking travel services directly.

Company Outlets

Physical locations for purchasing travel products.

Indirect Sales

Selling through intermediaries like agents or operators.

Market Reach

Extent to which providers connect with potential customers.

Customer Convenience

Ease of access to booking options for travelers.

Value Addition

Extra benefits provided by distribution channels.

Travel Agents

Professionals assisting travelers in planning and booking.

Distribution Channel

Path through which travel services reach consumers.

Level One

Direct service provider to customer interaction.

Level Two

Service provider to travel agent to customer.

Level Three

Service provider to tour operator to travel agent to customer.

Online Travel Agency (OTA)

Website for researching and booking travel services.

OTA Examples

Expedia.ca and Hotels.com for travel bookings.

OTA Relationship

Customer interacts primarily with the OTA, not providers.

OTA Convenience

Simplifies travel booking without personal assistance.

OTA Reach

Extensive access to travel options and services.

OTA Customization

Technology allows tailored travel experiences.

OTA Commissions

High fees charged to tourism suppliers for services.

Tour Operators

Entities packaging travel components for sale to agents.

Inbound Tour Operators

Bring visitors from external markets to a destination.

Outbound Tour Operators

Take travelers from one country to another.

Receptive Tour Operators (RTO)

Represent tourism suppliers to tour operators internationally.

RTO Function

Specialize in ground arrangements for incoming visitors.

Wholesalers

Intermediaries selling bundled travel products to agents.

Wholesaler Role

Buy tourism products in bulk for resale.

Wholesaler Examples

Travel Impressions and Jumbo Tours in tourism.

Tourism Supplier

Businesses providing services like hotels or airlines.

Net Rate

Discounted pricing for bulk purchases by wholesalers.

Market Inclusive Tours

Tours developed for specific market segments.

Supplier

Provides services to wholesalers at net rates.

Wholesaler

Intermediary purchasing in bulk from suppliers.

Reseller

Sells tourism products to end consumers.

End Consumer

Tourist purchasing travel services or packages.

Net Rate

Gross rate minus commission amount.

Retail Rate

Full price customers pay for services.

Commission

Percentage compensation for selling tourism products.

Tariff

Confidential schedule of wholesale rates.

Destination Marketing Organization (DMO)

Promotes long-term development of tourism destinations.

FAM Tours

Familiarization tours for travel agents and operators.

Travel Trade

Industry professionals facilitating tourism services.

Package Creation

Combining tourism products into travel packages.

Itinerary Development

Creating travel plans for clients.

Predictability of Bookings

Reliability in forecasting travel reservations.

Ease of Payment

Simplified transaction processes for bookings.

Marketing Cost

Expense incurred for promoting tourism products.

Sales Calls

Direct outreach to promote tourism services.

Tradeshows

Events for showcasing tourism products and services.

Block Space

Reserved inventory for travel agents.

Consumer Benefits

Advantages offered to tourists purchasing services.

Support

Assistance provided to travel agents by suppliers.

Travel Alberta

Example of a destination management organization.