EFFECTS OF AIRLINES ZERO COMMISSION ON THE PERFOMANCE OF TRAVEL AGENTS: A SURVEY OF AIR TRAVEL AGENTS IN NAIROBI CBD

Abstract

Purpose: The study was an assessment of the effects of airline zero commission on the performance of travel agents.Methodology: A descriptive survey of air travel agents in Nairobi CBD was taken. A population of 350 travel agents was identified out of which a sample of (35) 10% were randomly selected.Results: Findings indicate that travel agents had been affected by the Zero commission. Their profitability, customer satisfaction, employee morale and internal processes were affected negatively. Findings also indicated that charging fees, cost leadership, differentiation, specializing in geographical areas or becoming niche players for specific leisure products, improvement in customer service and increased marketing and communication , expansion of the product base , strategic partnership and external linkages with other service providers were some of the strategic responses being adopted by travel agents. Findings also indicated that Travel agents have increased investment in financial resources, human resources, knowledgeable and creative workforce, and improvement in brand name, a unifying corporate culture, robust IT infrastructure and corporate governance as an effort to recover from the zero commission problems. The study recommends that the travel agents continue using generic strategies and tailor made strategic responses as this would help them to deal with the problem of zero commission. In addition, the travel agents should also differentiate their products in order to attract more customers. The travel agents also need to continue charging fees and ensure that they deliver good customer service to travellers.Policy recommendation:The study recommends that the travel agents continue using generic strategies and tailor made strategic responses as this would help them to deal with the problem of zero commission. In addition, the travel agents should also differentiate their products in order to attract more customers. The travel agents also need to continue charging fees and ensure that they deliver good customer service to travelers.