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If you own a physical travel agency in America, it is possible that, without seeking change in affiliation, your signage might have added, and subsequently removed, the logos of Ask Mr. Foster, Carlson Travel Network, Carlson Wagons-Lits Travel and Travel Leaders Group.
And, on Friday, you may have called your sign maker again, this time to replace “Travel Leaders Group” (No. 7 on Travel Weekly’s 2019 Power List) with “Internova Travel Group.”
Then again, you may have just added “Internova” and retained “Travel Leaders Group.”
Or, your agency’s journey on the road to Internova affiliation or ownership may have included business cards that once included the brands Action 6, Cruise Shoppes, IT Group, Cruise Brothers, Vacation.com, Travel Planners International, Seamaster Cruises, Cruise Holidays, Space, TIME, CruiseLink, GEM, Aura, Crown, Consolidated Travel Services, Travel Associates Network, Navigant, Travel Leaders Corporate, Stevens Travel Management or Results Travel.
That list, incidentally, is not exhaustive.
However, Friday’s change of name for the country’s largest collection of travel agencies — 65,000 total agents, 57,500 of them U.S.-based — is not, as was previously the case, a relabeling to reflect merger or acquisition activity.
In a wide-ranging interview with Travel Weekly, Internova CEO J.D. O’Hara explained the reasons behind the renaming, how the company is being reorganized and its potential impact on individual agents, the outlook for future acquisitions, the possibility that some agencies might not make it through the current crisis, Internova’s relationship with private equity owner Certares and the other travel-related companies that Certares has investments in, and why the name Travel Leaders Group remains for the division above brands primarily serving leisure clients.
But first: Why Internova, from the Latin meaning “among the new?” The name, O’Hara said, did not come about as a result of focus groups or from recommendations by a big-league branding firm. Rather, it already had existed within the company as something of a placeholder, a label created to serve a technical, legal organizational function, and was simply being repurposed. “I wish I had a better story, but there’s not a lot of deep meaning behind it,” he said.
The need to rebrand the company was driven by the recognition that the name Travel Leaders Group, adopted after acquiring an agency organization by that name, was not always a good fit with companies outside leisure travel, though he strongly believes it remains relevant to leisure brands. Internova has retained it as the name of the leisure division.
And beyond that, O’Hara saw benefit in realigning the company into divisions reflective of the differing needs of agencies based on the types of clients they served.
The resulting reorganization, O’Hara said, will facilitate the sharing among agencies with similar goals the support functions, tools, resources and services that are currently scattered throughout the organization.
“The idea is to have a focused set of experts over top of the businesses with commonalities and have a clearer home for all advisors, agencies and travelers,” he said.
“We’ll pull together those resources and processes under one umbrella to solely focus, for instance, on the leisure agent,” he continued. “We want to leverage the knowledge that we have from the Travel Leaders Network and apply it people in CruCon, as an example. We want to leverage the knowledge and know-how and talent that we have at CruCon and enable it to empower Nexion agencies. We’ll do the same for the corporate agent and the same for the independent contractor, et cetera. The idea is to enhance their experience today, and ultimately add arrows to their quiver to better serve their traveling client.”
Asked whether access to the same toolkits might blur differentiation among the brands within a division, O’Hara said that differentiation remained strong in terms of the operating structures — franchising, hosting, consortium affiliation — within the leisure division, as an example. Different brands, he said, permit agents to work within a business format that best suits their needs.
Much of Internova’s growth has been organic, but its history reflects a decades-long buying spree. Downturns such as the one the industry is currently in can provide opportunities for acquisitive companies to pick up financially distressed competitors.
Internova is owned by private equity company Certares, whose CEO, Greg O’Hara, is J.D. O’Hara’s brother. (J.D. had worked for Certares before moving to Travel Leaders Group.) J.D. O’Hara said he couldn’t comment on what Certares might or might not do regarding mergers or acquisitions, but that Internova has its own M&A team that presents its assessments and recommendations to its board on a case-by-case basis for approval. “We always have our ear to the ground, [but] I would say at this moment there’s not a whole lot of activity going on,” O’Hara said. “We don’t have anything planned.”
Among Certares’ investments is a 50% stake in American Express Global Business Travel (Amex GBT). Given the current crisis and Internova’s rolling reorganization, is the time perhaps right to explore synergies between Amex GBT and Internova’s considerable corporate travel activity?
“Possibly,” O’Hara said. “My guess is there certainly would be synergies, but these are very separate investments by Certares, with separate management teams and even separate investors in some cases, and we operate independently. I suppose there could be a case where there could be a commercial relationship, but we’ve not explored that. They’re in a relatively different market, looking at global, mega corporate clients. They’re all in on that model. We’ve got a much more diverse business, and small-to-medium sized corporate is just part of what we do.”
O’Hara said the timing of the reorganization and the Covid-19 crisis was not by design, but the realignment will help the company recover. “We will have a more streamlined set of processes. When travel resumes, we will return to profitability much more quickly than we would have under our previous structure. We’re more aligned for a speedy recovery.”
Speedy recovery, perhaps, for those who make it through the crisis, but there are predictions that many agencies may close before people begin traveling in earnest again. “I hope that’s not the case,” he said. “I would imagine that [some agency closures] are likely, but in terms of a percentage, I couldn’t tell you that. And even if hundreds of agencies disappear, it’s a relatively small percentage of the pie.”
Might some sectors — leisure, corporate, meetings — be hit harder than others in the coming months?
“Probably, though I couldn’t highlight what they are,” O’Hara said. “We’re extremely bullish on travel as a long-term investment, and I have no thoughts about getting out of one of those lines of business. But some of these newly defined divisions will likely come back at different paces and different trajectories.
“At the end of the day, the reorganization puts us in a position of strength to come back more profitable and service-oriented to our agents and offering a better product all the way around. This is something that’s made sense for a long time. We’ve hemmed and hawed about carrying it out, but we believe it’s the right thing, now more important than ever. While the timing of my taking this position in January can be admired — or, ‘condolences, J.D.’ — I’m proud of the work this team has accomplished during a less than desirable situation.”
Source: travelweekly.com