Amadeus study shows opportunities for Saudi travel agents in technology adoption

The latest study commissioned by Amadeus, a major technology partner for the global travel industry, identifies the value of using the newest technology in the distribution sector, travel Agencies having adopted Amadeus’ new generation IT solutions saved over 20 percent in cost and increased their agents productivity by 15 percent.
Conducted in Saudi Arabia by the independent company Hermes Management Consulting, the report “How GDS can improve cost efficiency and optimize business for travel agencies" unveils that in a “Zero Commission environment", technology is crucial in maintaining profitability.
This study offers an in-depth understanding of business and leisure travel agencies in Saudi Arabia through examining their business models, processes, cost drivers and productivity levels. It also allows comparing results with a similar one conducted in 2006 with the same agencies before adopting Amadeus solutions.
The positive outcome still encourages travel agencies to reach an even higher profitability by further integrating non air bookings in their IT platform.
Ezequiel Iturain, Hermes Management Consulting manager, commented: "This second analysis allowed us to discover that Amadeus solutions can make a difference in the bottom line of travel agencies. This study is based on the comprehensive revision of the financial data and in depth analysis of the business processes of the participating agencies through which significant cost savings have been spotted. As a result of having embraced the Amadeus technology, agents reduced their time dedication on core-reservation activities (reducing core-reservation costs by 0.8 euro) and increased customer care and account management activities in order to satisfy the demand for enhanced service (0.9 euro increase).
He added: “Agencies are now investing € 0.9 more per ticket in IT development. Some opportunities still remain as service fees are now the main revenue stream for travel agencies and Hotel bookings have a significant positive impact in profitability when processed through the GDS. The first study, which was conducted in partnership with Amadeus in 2006, had enormous relevance for Saudi Arabia and the Middle East region.”