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Ethnic Travel Presents a Growing, Profitable Niche for North American Travel Agencies, According to New Amadeus Report

Report analyzes market opportunities and business drivers for agencies serving ethnic and heritage travelers in the U.S. and Canada; Amadeus offers solutions package tailored to the unique needs of North American ethnic travel agencies

Miami, FLAmadeus, a leading travel technology partner and transaction processor for the global travel and tourism industry, has released a new report focused on the growing niche of ethnic and heritage travel and the emerging business opportunities it presents for travel agencies in North America.

The Amadeus report, “Understanding Ethnic Travel Agencies’ Cost Drivers and Business Optimization Opportunities,” takes an in-depth look at ethnic travel trends and travelers; explores the various business models of various types of ethnic agencies; and identifies opportunities for them to optimize their business and serve their clients.

“With the foreign-born population in the U.S. at 38 million people, ethnic travel is an area that is positioned to significantly increase.  This presents a potentially profitable opportunity — but one that comes with unique business and technology needs — for travel agencies who want to serve this growing niche group of travelers,” said Tom Cates, Chief Commercial Officer for Amadeus North America. “This report, along with Amadeus’ unique solutions package, is aimed at helping travel agencies better understand and position their services and business efforts to capitalize on the ethnic travel segment.”

For the purposes of the report, an “ethnic travel agency” is defined as one primarily serving foreign-born individuals who are part of particular ethnic groups traveling to and from their native country to visit family or friends.  Ethnic travel agency owners and agents are also likely to come from the same background as their customers. Ethnic travel agencies are predominantly located in U.S. metropolitan areas and within ethnic communities.

Cates said although the focus was on U.S. ethnic travel agencies, many of the recommendations in the report hold true for any travel agency.  The study reveals that ethnic travel agencies could benefit from:

Ÿ         Increasing sales of high-margin, non-air products like hotels, car rentals and packages

Ÿ         Diversifying their destination offers to seize the opportunity of attracting and retaining 2nd and 3rd generations of ethnic travelers

Ÿ         Establishing an online booking engine as a complementary sales channel to offline efforts

Ÿ         Tracking marketing expenditures so the agency can redirect their dollars to the most cost-efficient and profitable channels

Ÿ         Utilizing customer relationship management (CRM) tools so the agency can increase revenues by offering products based on their clients’ preferences, while also tracking customer satisfaction and marketing activity

Ÿ         Capitalizing on distribution automation delivering broad content and business efficiencies

The opportunity for ethnic travel agencies in North America

There are currently 38 million foreign-born individuals living in the U.S., comprising nearly 13% of the total population, according to the most recent U.S. Census data. Latin American immigrants account for 54% of this population, with Mexico being the main country of origin. People migrating from Asian countries account for 27%, with China, the Philippines, and India accounting for 51% of that group. New York, Los Angeles, Miami, Chicago, San Francisco, Houston, Dallas, and Washington D.C. have the highest foreign-born populations, accounting for almost 50% of the total foreign-born population in the US.

In the report, Amadeus identifies that there are currently over 1,000 ethnic travel agencies in North America, with approximately 80 percent in the U.S. and 20 percent in Canada.

Amadeus exclusively offers a tailored portfolio for ethnic travel agencies

“We created the Amadeus Ethnic & Heritage Travel Specialist package to help these specialty agencies maximize their business and the services they provide to their clients so they can keep up with the demand in an increasingly competitive marketplace,” said Cates.

The unique solutions package incorporates the Amadeus Selling Platform, with time-saving tools and high-value GDS and non-GDS content to help an agency expand its offering and serve its clients.  And as the industry leader in international air content, Amadeus delivers what ethnic agencies require as heavy international air bookers.  Also included is access to powerful faring engines that guarantee the best prices, the ability to manage blocked space, ticket changer automation and critical training and support services.

About the report

Commissioned by Amadeus, research firm Hermes Management Consulting completed the independent study of select North American ethnic travel agencies at the end of 2010.  The report takes a “deep-dive” in analyzing a variety of ethnic travel agency models and presents a broad array of financial data and business processes of the various types of ethnic travel agencies. To download the full report and for information about Amadeus solutions for ethnic travel agencies, visit http://www.amadeus.com/us/x200836.html.

* Most recent data available from 2000 U.S. Census representing foreign-born people living in the U.S.

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