The Affect of E-commerce on Travel Agent in Taiwan

The emergence of e-commerce has reshaped the travel industry, as it not only facilitates the direct link between consumers and suppliers while bypassing travel agents, but also nurtures many new mega e-travel agents. While it endangers the status of travel agents, e-commerce also provides a platform for traditional travel agents to compete globally. Therefore, how to respond to these challenges and opportunities is crucial for survival for travel agents in Taiwan. A lot of research has been undertaken on mega e-travel agents' successful stories in the USA and UK. Less understood is the exact process of this impact on traditional small-medium size agents, especially in Taiwan's context. By using Bloch and Segev's framework and Michael Porter's model, this research examines the impact of e-commerce on both the travel industry and a medium-size travel agent in Taiwan. Secondary data was used for industry level analysis and in-depth interviews were conducted to gain the insight of the transformation process. Quite contrary to the popular thinking, this study revealed in industry level: major suppliers-airlines, they hesitated to provide direct sale to consumers; the new e-travel agents did emerge yet with less influence as their counterparts in the West, only prevailing in ticket-only or domestic market; most of travel agents regard e-commerce only as a alternative channel to promotion and advertisement. City Tour has taken a cautious-follower's strategy in e-commercialization. The strategies suggested for City Tour include: expansion target market to the inbound market, enhancing its product innovation and customer-focus.