Holiday planning: book early to avoid high prices

By Updesh Kapur/Doha

Expatriates have begun sending their families home for the long summer break before joining them later. But it is after Ramadan that the real holiday mood gets into full swing for many in the Gulf.

Post Ramadan, the travel exodus will begin in earnest for the Eid al-Fitr holidays and beyond.

The luxury of having a week or so of official Eid Holidays followed by annual leave is nice to have.

For those not yet decided where to go on holiday, decisions have to be taken fairly quickly.

Flights are filling up, hotels are getting busy and prices are certainly not coming down.

Choosing where to go, if no decision has yet been taken, has to be done fast to avoid last minute bookings. And the whole process is stressful, particularly if one is not buying the holiday as a package, instead choosing the core elements separately – flights, accommodation and car hire.

The notion that last-minute bookings will always procure the best prices is not the case, certainly not during the approaching peak travel season.

During off-season, there are bargains galore for last-minute holiday shoppers. But the next few weeks will not reap the best deals.

From the Gulf, the mass departures to all corners of the world create more demand than supply, hence resulting in the basic economic principle of customers having to pay more.

High-season travel during holiday periods helps squeeze the bank balance. Eid, New Year, Christmas, Diwali and school breaks – the list is endless.

High volume travel during such periods ensures number-crunching pricing analysts in airline, hotel and car rental revenue departments churning out maximum prices to maximise returns.

These high seasons generate high revenues, high profitability and inevitably higher yields for the products sold so there is no reason why travel suppliers should reduce prices during such peak periods.

Don’t forget, and many do, that booking the same holiday is not exclusive to you or fellow customers from the country you are making that reservation.

It’s a big competitive pool out there as airlines, for example, open up the same seat inventory to passengers from around the world.

So to fly from any of the key Gulf hubs – Doha, Dubai, Abu Dhabi, Muscat and Bahrain – to anywhere in the world, it’s a big bun fight from feeding markets competing for the same seats out of these hubs to global destinations they serve.

Flying from Doha to London, for example, the choice is endless. Take either the direct non-stop route with the national airline Qatar Airways or British Airways or via the Gulf hubs and even mainland European bases of other carriers such as KLM or Lufthansa.

The route is operated with more than 30 daily flights, either direct non-stop or indirect with connections.

The price invariably is cheaper flying to the final destination indirect due largely to the inconvenience of transiting through another airport, which is why the connecting carriers will lure passengers away from non-stop airlines in the home market.

Like any business, airlines have two clear objectives: to be commercially viable and profitable, hence they carefully carve out pricing strategies to maximise returns on the numerous route combinations.

Walking into an airline reservation office or travel agent – or simply going online – to buy a ticket for same day travel or a day or two in advance can badly hit pockets.

The traveller needs to fly so will be prepared to pay the asking price no matter what it is. It is here that the airline can make a killing.

If you have the option of booking a flight at an inconvenient travel time, say middle of the night, as opposed to a more reasonable daytime flight, do so to secure a better fare.

Airlines assess travel patterns based on previous 12-month historical data which helps provide an insight into price-setting for the next 12 months. With higher revenue target levels set by airline bosses year on year, there has to be a balance to keep fares reasonable, sustainable and, yet, competitive – so analysts have a tough job indeed.

Hard to believe, but air fares in realistic terms have actually gone down over the past 30 years. The cynics would disagree.

A recent report showed air fares have dropped 50% since the late 1970s due to the advent of deregulation and greater competition in the skies.

More competition, more airlines, more choice and more options have seen depressed air fares year on year. Still hard to believe? The dreaded additional air passenger taxes, fuel surcharges, airport taxes, etc, have actually been responsible for our perception of air fares being too high. Every airline is faced with supplementing the actual ticket price with these added charges – something unheard of 30 years ago.

There is more competition in the skies today with a plethora of airlines plying routes non-stop or via another point, pitching for the same business. Without competition and choice, the business environment becomes monopolistic, so fares invariably are higher.

So what are the choices if you haven’t already booked? What are the trends and best options out there?

Europe once again remains a popular hotspot. Whether it’s the northern Scandic countries or Iberian peninsular to the south; the forever loveable tourist destinations of London, Paris, or Istanbul’s Euroasia charm, Europe continues to be a magnet for travellers from the Gulf. The recent introduction of a visa waiver programme by the British Foreign and Commonwealth Office for Qatari nationals has led to a spike in bookings.

Eurostar trains linking Paris and London have added adventure to a two-city European tour; Barcelona’s charm on the Mediterranean and its global marketing appeal thanks to a star-filled soccer team have lured tourists; while mainland cities Vienna, Munich and Zurich and their attractive surrounding environment remain key draws.

Rail travel across Europe is becoming increasingly popular for the Gulf tourist, more as couples than as families while Disneyland Paris has become a good getaway as an add-on break to the French capital.

Turkish Airlines’ introduction of free day-time city tours in Istanbul for passengers with over six-hour transit times has been a big plus in the carrier’s marketing initiatives as it breaks the stranglehold of Gulf carriers’ dominance of long-haul travel.

Eastwards, Malaysia, Singapore and Thailand remain firm favourites thanks to their multi-cultural, multi-cuisine appeal, helped by more air capacity offering better access to South East Asia.

Cruising is relatively new to the regional market, but is picking up with Scandinavia, Mediterranean and even Alaska showing encouraging signs, the latter helped by direct flights from Dubai to Seattle.

The US has been a boon for Gulf carriers with 2014 clearly the year of growth to the US. American expansion since the beginning of the year has seen a 30% increase in the number of weekly departures from the Gulf to over 150 flights spread across a multitude of US destinations including New York, Washington, Philadelphia, Boston, Miami, Dallas, Houston, Chicago, Los Angeles, San Francisco and Seattle.

Earlier this year, US bound passengers from Abu Dhabi have been able to avail of new immigration, customs and agriculture clearance inspections prior to departure.

This pre-US entry clearance formality has been a big selling point for passengers travelling on Abu Dhabi-based Etihad Airways enabling them to be treated as domestic US passengers on arrival allowing for faster processing at their arrival airport and avoiding unnecessary queues that we see so often entering the US.

N M Shafiq, general manager of Doha-based Regency Holidays, says choices of where to travel are greater than ever before, pointing out there is still capacity out there which is being snapped up quickly.

“We are very fortunate to see a huge variety of options across the travel sphere and this is not just limited to flights,” he says.

“Yes there are more flight options, more hotels and generally a much bigger choice. We are finding the average holiday booking is for three weeks with reservations during the peak summer and post Ramadan period picking up in the last two weeks.

“London, Paris, Barcelona, Munich and Zurich continue to shine, but we are also seeing the USA a big seller thanks to more American destinations being served from the region. Hawaii and Orlando in particular are seeing significant interest due to the additional city gateways being introduced by Gulf carriers. The US immigration clearance facility in Abu Dhabi has appealed to many travellers keen to avoid long queues on arrival in America.

“And of course we are seeing a substantial increase in people opting for cruises as part of their holiday, again largely due to more air capacity being flown to cruise centres.”

The world as they say is your oyster with a wide choice of options on the table.

In this day and age, work pressures and stresses can make it difficult to plan well ahead.

But try to as much as possible to avert paying the price for a late booking and secure the holiday of your choice to suit the budget you set aside.

If not for the current high summer travel season, think ahead of the next peak.

Holiday planning: book early to avoid high prices