Tourism Management 27 (2006) 1371–1372 Ken-Air Tours—The volatile tourism market in Singapore Tham Min-En Aaron à RMIT University, GPO Box 2476V, Melbourne, Victoria, 3001, Australia Received 9 March 2005; accepted 30 November 2005 Abstract Tourism is a key industry in the economy and it is expected to play a key role in the service industry sector. Because of the growing adoption of information technology in the world, the tourism industry too, has been in utilizing the information highway to redefine and deliver the tourism product to the end consumers. Because of the shift towards information technology, the travel agent’s traditional roles as an intermediary has come under severe pressure and is currently challenged to its existence. The demise of Ken-Air Tours, a large player in the travel agency industry in Singapore, is the focus of this report and the impact of the emphasis on technology is investigated and discussed. r 2006 Elsevier Ltd. All rights reserved. Keywords: Travel agency; Online marketing; Singapore 1. The travel agent The travel agent, who provides a sales outlet for air carriers, hotels, car rental firms, major attractions, event organizers and other travel suppliers, represents an important intermediary within the travel industry. Recent changes within the travel industry have resulted in the travel agency business becoming increasingly sophisticated and competitive. The original agencies were primarily established as independent ticket outlets for a particular airline. Travel agencies now sell a variety of travel services and serve as consultants for both pleasure and business travellers (De Souza & Lim, 1997). Although travel agents sell many travel products, they remain heavily dependent on air travel sales. Indeed, it was the advent of air travel that spawned the tremendous growth in the consumer industry and, subsequently, in the travel agent industry. Nearly two-thirds of the travel agency’s gross income is derived from the sales of airline tickets (Butler, Carter, & Brunn, 2002). With deregulation and travel agents’ loss of exclusivity in the sale of airline tickets, many analysts feel the long-term relationship that travel agents have had with airlines may be changing. Airlines, in looking at alternative distribution systems, appear to be advertising more directly to the public and less to the travel trade. Meanwhile, travel agents complain about the constant fluctuation in airfares, lack of sufficient information from airlines and the fact that they must pay more attention to carrier consumer advertising to keep abreast of new rates. Other income-producing services offered by travel agencies include vehicle rental, coach and rail travel sales, sightseeing tours, sale of travellers’ cheques, passport photos, attractions and entertainment services. The sale of travel insurance is also a means of diversifying and increasing agency revenues. 2. The tourism industry of Singapore The tourism industry in the case of Singapore is a significant contributor to economic earnings. The absence of natural resources has made tourism a valuable tool for economic growth and development. Fig. 1 illustrates the receipts of the tourism industry over the period 1994–2002. Steady economic growth, the improvements to air travel and the commencement of the budget carriers have increased the tourism prospects for Singapore. ARTICLE IN PRESS www.elsevier.com/locate/tourman 0261-5177/$ - see front matter r 2006 Elsevier Ltd. All rights reserved. doi:10.1016/j.tourman.2005.12.012 à Tel.: +61 3 99057489; fax: +61 3 99055400. E-mail address: tan_ming_en@hotmail.com.