The disintermediation and re intermediation of travel

Therefore, in relation to internet-influenced market changes, there are three types of intermediary shifts: The database driven portal offers a range of product and services that are not held as inventory by the intermediary e.

Practically, Orbitz was launched by airlines to re-intermediate the OTA market early online travel agenciesGranados et al.

You can, of course, try and find the local flavor or seek out specialty events through the internet but there is a reason that people in droves still utilize travel agents. Since the introduction of ecommerce, countless goods and services have utilized the Internet to bypass intermediaries, with almost all major brands establishing online stores to enable consumers to buy directly from the manufacturer or service provider.

However, since intermediaries are merely secondary services in the broader transaction, it is vital that their costs to either producer or consumer not exceed the value they add to the transaction — else they risk elimination from the supply chain in favor of increased profits or lower prices Shunk et al.

Crossby et al, In the study by Gharavi H. Furthermore, new customer services may be required to replace those eliminated in the disintermediation process e.

Accordingly, Anderson and Anderson cited by Barnes and Hinnton, classify cybermediaries in three categories, depending on the role they perform. Consumers, through the use of the Internet will become more self-sufficient in the service delivery process. There is quid pro quo for the vendor for the use of the platform, else it would make no business sense to create such a platform.

According to Heng-Hsiang Huang and Chou-Kang Chiu the travel agents are important for developing relationships with the clients. For instance in becoming a distributer, the manufacturer becomes a primary competitor of the former intermediaries, thus sabotaging relationships with retailers and other channel partners who may previously have helped build the company.

In other words the Internet introduces possibilities to travel agents for defining their position in the distribution chain. And how can you use it to benefit you?

Hence, the first role is an informational one, which, link the buyers and sellers together by providing information about each of them and their product. Here, a database-driven portal offers a range of products and services that are not held as inventory by the intermediary.

Over the past two decades we have witnessed almost every major industry undergo some form of intermediary shift as a result of internet-based technologies. Examples of companies[ edit ] Notable examples of disintermediation include Dell and Apple, which sell many of their systems direct to the consumer—thus bypassing traditional retail chains, having succeeded in creating brands well recognized by customers, profitable and with continuous growth.

In conclusion it is about a considerable change on travel agents and their role, indebted to the internet together with its technological capabilities, which introduce new possibilities for the distribution of travel services Debicka, Business Horizons, 44 2 However, with the introduction of e-commerce, many tasks done by intermediaries can now be automated.

Reintermediation occurs due to many issues associated with the e-commerce disintermediation model, mostly involving issues with the direct-to-consumer model.

Out of the box: Or more specifically, what is disintermediation? You could Google, or you could text your agent with whom you have worked, someone who knows your preferences, tastes, and what you want from your trip and have them do the work of finding and booking something while you enjoy your time abroad.The travel industry has undergone a process of disintermediation and re-intermediation where the traditional travel distribution channels composed of small travel agencies have been replaced by a new generation of giant virtual travel ventures based on innovative online business models and backed up by advanced information technology (yeung &.

Disintermediation may decrease the total cost of servicing customers and may allow the manufacturer to increase profit margins and/or reduce prices. Disintermediation initiated by consumers is often the result of high market transparency, in that buyers are aware of supply prices direct from the manufacturer.


Buyers may choose to bypass the. disintermediation and re-intermediation of the travel agents In the last twenty years several changes occurred in the tourism distributional channel. Every component of the chain value has been affected and particularly travel agents.

Difference between Disintermediation, Re-intermediation and Counter mediation

Disintermediation is already taking a hit on the business-toconsumer front, where new business models, such as cobranding and digital channel management - as opposed to channel cannibalization - are beginning to take hold.

Travel industry was the first to experience disintermediation due to the varieties of products given by the Internet for customers. Consequently, the role of the travel agent, who is the main intermediary in the travel distribution chain, has been threatened (Bloch and Segev, ; Opperman, ; Potzl, ).

The Disintermediation of Travel Whether you are a leisure or business traveler, you are likely aware that the world of travel has changed dramatically due to the rise of the internet and the spread of mobile devices.

The disintermediation and re intermediation of travel
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