Travel agencies that provide fee-based travel services that cater to middle and upper class travelers.  An old idea returns.  If you visit India today, you will find that travel agents there provide services more like what travel agents provided a hundred years ago.  For example, an Indian travel agent will do more than issue a ticket.  They will make arrangements for a car to pick you up from your hotel and drive you to the airport.  At the airport, the driver or representative from the travel agency will walk you through the process of getting to your plane.  If you are taking a train, a representative from the travel agency will see you to your train, locate your seats and stow your baggage overhead before bidding farewell.  At your destination, another travel agent, part of a network of cooperating travel agents will be waiting for you with another car and a translator/guide to take you to your hotel and to tourist attractions.  Their role is to constantly look after your needs and supply whatever you need to make your trip enjoyable.  If you want to go by car from one city to another, they will contract with a driver on your behalf.  As a traveler, your arrangements are made and the details worked out without need for your participation.

Parts of this kind of system are available today in the U.S.  You can, for example, arrange for a car (not a limo) and driver to pick you up from the Los Angeles airport and take you to where you want to go.  The fees are not much more expensive than renting a luxury car from a car rental service.  However, it is unlikely that your local travel agency will know about this service or how to arrange it for you.  It is also unlikely that you would know about such services.

The concept of this business is to create a network of boutique travel agencies that work with each other to offer personal services to middle and upper class travelers for a fee.  A travel agency in NYC city would provide cars and drivers to pick up customers and deliver them to their departure terminal.  Tickets, luggage handling, even food would be provided to the traveler.  At the destination, another car and driver would be waiting to pick up the traveler and their luggage and deliver them to their hotel.  The hotel would be prepped to receive the traveler and have whatever amenities the traveler desired already in their room.  This might include flowers, foam pillows, liquor, or even a maid to hang up clothing.  A representative from the Los Angeles travel agency would be constantly available 24 hours a day to make reservations at restaurants, plays, or other entertainment venues.  A car and drive would be available on 15 minutes notice 24 hours a day.  For foreign travelers, translator/guides would be provided to show the traveler the city.  Business travelers would be provided secretarial/translator services.

The traveler's travel agency would profile their customers thoroughly to find out what their travel needs and desires are.  This exists to some degree already on some of the online travel reservation services.  For example, I can book a non-smoking room.  Imagine this being carried to a higher level where the contents of the in-room mini-bar could be ordered in advance without your having to ask for it each time.  Imagine, being able to request foam or fiber fill pillows, a fragrance free room, or a room away from the street in advance without having to ask for it each time you travel.  What would make this system successful would be the customer profile. 

Believe it not, these are the kind services that were offered by travel agencies long ago.  If you were British and you planned to travel to a distant land, your travel agency, through a complex network of representatives, would make your journey trouble free.  Everyone along the way knew in advance of your arrival and your needs.

What is amazing is that many of these services are available today at a low cost, but few travel agents know that that they exist.  Most travel agents are trained to issue tickets and not much else.  A few can tell you about which cruise boat is better than another, but this advice is usually heavily influenced by commissions from the cruise line rather than the client's needs.  The advice that travelers would get if the traveler were paying the fee could be quite different.

The bottom line is that successful future travel agents will be service rather than sales driven.  The first agencies to set up a network of travel agents to deliver exceptional customer specific services will be the next American Express or Thomas Cook Travel agency.    

Assumptions

• Existing travel agencies are being replaced by self-serve travel Web sites on the Web.
• Revenues from ticket sales are shrinking
• Profitability is becoming harder to maintain.
• Middle and upper class travelers require more services than bargain travelers.
• Middle and upper class travelers will pay fees for services that go beyond issuing tickets.

Profits

There is no question that service costs.  However, given a menu of desirable services, middle and upper class travelers will pay for services they want.

There are several pricing models available from percentage of fees to flat fees.  The travel agency will have to evaluate which model works best to provide travelers with the most service for the least fees and still be able to make a profit. 

A travel agency that charges a hundred dollars to issue a ticket and reserve a hotel room is not going to survive in the scenario I describe.  The travel agency that charges a couple of hundred dollars to make every aspect of the traveler's journey a customized pleasant experience has a chance at survival and profitability