Analysis of Commission Reduction Effects to the Travel Agent-s Sales in The Domestic Market
Hendra, Tengku Ezni Balqiah
Universitas Indonesia
Abstract
Indo Airways is an Indonesian airline that sells full-service transportation for the customer which covers domestic and international routes. Their domestic sales are handled by traditional and online travel agents with contribution 68% of total domestic sales. Those travel agents get the percentage of commission from the basic fare of each ticket sold. Started from April 2017 Indo Airways has decided to reduce the travel agents- commission in the domestic area. However, on the other hand, agent contribution to total Indo Airways sales is significant. This research investigates how the commission reduction is affecting the traditional travel agents- sales in each region of the domestic area. The analysis will be based on the theory of sales promotion, marketing mix, and the cost leader approach and a hypothesis on approaching the analysis of the effect. The analysis of the secondary data will use descriptive analysis based on time series data comparison. The study finds that all sales in the different regions are decreased, but that decrements are significant for some region only.
Keywords: Airlines, Travel Agent, Commission Reduction, Sales Promotion
Topic: Marketing Management