Working in Market - Malaysia

Distribution system

The Malaysian travel distribution system is highly fragmented and varied across the country. Whilst there are a very few national retail agencies, most agents are small, independent businesses, and contribute a varying percentage of business to Australia. There is no formal distinction between wholesalers and retail agencies in the Malaysia market.

Malaysian consumers are researching and booking their trips using a combination of traditional travel agencies and online options. Online bookings are growing rapidly in Malaysia amongst the Free and Independent Traveller (FIT) segment, particularly for flights, accommodation, car rental, day tours and entrance passes. The online environment is providing consumers with extensive destination information, and the ability to conduct price comparisons. Social media continue to gain popularity with Malaysians for sharing information. The preference for last minute travel purchases remains entrenched for most Malaysian travellers.

Wholesalers/large agents

Commission level: up to 15%

• There is no formal distinction between wholesalers and retail agencies. A few large travel agencies such as Apple Vacations, Forever Travel, Corporate Information Travel, Golden Deluxe, Golden Tourworld, Holiday Tours and Travel, Malaysian Harmony, Sedunia Travel, Pearl Holiday and Parlo Tours take reservations from consumers through their retail network at the same time distribute their packages through smaller travel agencies.
• GD (Golden Destinations) is a Core Brand from ICE Holidays, they are the leading B2B Travel Wholesaler in Malaysia. GD offer their ready-made products and packages, with advertisements and promotions support to smaller travel agencies which have limited access to inbound tour operators and do not undertake consumer advertisement.

Retail agents

Commission level: up to 10%

• Retail travel agencies usually have a shop front and offer travel advisory to consumer. There are approximately 2,000 outbound travel agencies registered with Malaysian Association of Tour and Travel Agents (MATTA) and Malaysian Chinese Tourism Association (MCTA).
• With increasing interest from the Free and Independent Traveller (FIT), more travel agencies are organising their own tour packages to meet customers’ needs and demands, rather than relying solely on packages developed by the larger agencies or wholesaler. 

Online travel agent

• All major retail agencies have an online presence, and online business is growing. However, the number of direct consumer enquiries and visits to offline agents remained. 
• Key Online Travel Agencies in Malaysia include Agoda.com, Booking.com, Airbnb, Klook, Expedia, Traveloka, hotels.com, Trip.com, and Kkday.
  
• Airline sites are increasing in popularity for flight and accommodation bookings, especially those with popular services to Australia such as Malaysia Airlines, Air Asia X, Batik Air, Singapore Airlines, Scoot, Qantas and Jetstar.

Aussie Specialists

• The Aussie Specialist Program (ASP) is the primary platform for Tourism Australia to train and develop front line travel sellers to best sell Australia.
• There are over 1200 qualified Aussie Specialists in Malaysia. This includes 30 ‘Premier Aussie Specialists’, recognised with Premier status for their extensive knowledge of the destination, commitment to selling Australia and ongoing learning via the Aussie Specialist Program.

Inbound Tour Operators

Commission level: up to 20%

• Inbound tour operators (ITOs) remain a key link in the distribution of product in the Malaysian marketplace. However, there is a noticeable trend to direct deals with hoteliers and operators, for accommodation and day tours. ITOs also handle a large proportion of FIT, incentive groups and non-group itineraries.

Trends

Distribution

• The total trip spend on leisure travel to Australia by Malaysian travellers was AUD$428 million in 2023, growing by 92% compared to 2022, while the average trip spend was AUD$2,100, dropping by 7% compared to 2022 (Source: IVS 2023).
• Safety, nature and wildlife, cultural, food and drinks and shopping are key drivers for Malaysian when considering a holiday destination. 
  
• The structure and function of distribution channels in this market is complex and changes rapidly. Consumers tend to use a combination of traditional distribution partners and online options to research and book travel.
  
• Whilst FIT is a significant business for Australia, Group is expected to be a vital sector for safety conscious consumers.
  
• Most FIT consumers book accommodation and air tickets online, while some are using FIT specialised agents.
  
• Groups tend to travel during peak season when the major holidays such as school holiday, Chinese New Year, Hari Raya festival and Christmas occur. The lead time is three to six weeks prior to the peak season. FITs travel more during the off-peak months and have a shorter lead time than group travellers.
  
• Weekends combined with public holiday are the most in demand travel pattern. Malaysian consumers also tend to take frequent short break holidays.
  
• Cruising companies are aggressively working on gaining market share offering competitive promotion for intra-region and fly cruise package to capture outbound travel market share. There are increased of trade activities such as training, roadshow and famils.
  
• Major consumer travel fairs are organised by the Malaysian Association of Tour and Travel Agents (MATTA) and Malaysian Chinese Tourism Association (MCTA), usually occurring in March (Kuala Lumpur, Ipoh, and Penang), April (Johor), July (Penang), August/September (Kuala Lumpur, Ipoh, and Johor).
  
• Specialty tours for international sports such as marathons, golfing, cycling and major events such as Vivid Sydney, Melbourne Cup, Food & Wine Festival, and music concerts are growing for Malaysia visitors.
  
• Klang Valley (Kuala Lumpur, Selangor and its surrounds) is the main source market for Australia. The city has the highest concentration of people who can afford to travel, as well as the best connectivity with both direct services and one stop services to Australia.
  
• Penang is the second largest city and a developing market for Australia. The market is more traditional than Klang Valley and prefer to travel in groups. However Free Independent Travel (FIT) segment is also growing.
  

Planning and purchasing travel

• Malaysia is a mature market and consumers have a solid knowledge of Australia. Most travellers prefer to plan itineraries and pre-book all/most activities prior to travel. Position Australia for its unique experiences to change the perception of an Australian holiday.
• Travel become part of lifestyle with an average 2-3 short haul and 1-2 mid to long haul holiday per year for many Malaysians.
  
• Malaysia is traditionally a late booking market and consumers have a short lead time for booking holidays, ranging from three to six weeks on an average, prior to the date of departure.
  
• Consumers in Malaysia are value conscious and actively review a range of destinations and information sources, seeking favourable deals before making travel purchases.
  
• Many FIT consumer book flights through airlines direct platform and secure ground arrangements later.
  
• Word-of-mouth and online peer reviews are the most influential source of information at the planning phase in Malaysia.
  
• Travel search engines are important information sources for consumers as they expand search options beyond flights and hotels to packages and car hire. These travel search engines are also partnering with user-review sites and affiliating content to major internet portals and media sites.
  
• When buying travel products consumers tend to refer to a mix of information sources, this includes general internet search, reference to guidebooks, visiting travel agents or NTO websites and brochures.
  
• The result of slow economic development, at one end tourists are seeking for comfort/luxury travel products, at the other people are looking for thrills/budget travel.

Planning a visit to market

Top tips for sales calls

• Malaysian travel trade partners value personal relationships and loyalty. Persistent visits and contact can assist in this process.
• Tourism Australia has an office in Kuala Lumpur. Make your first call to the Tourism Australia office to receive the latest market information and provide a product update.
  
• Avoid sales calls on a Monday and the week prior or during major holidays, school holidays and travel fairs.
  
• Plan and combine visits that are in the same geographical area so you can maximize the number of sales calls and minimize commuting times.
  
• The best time of year for sales calls is after Chinese New Year, April and mid-June to August and October.
  
• Sales calls should focus on agents in Klang Valley at least twice a year, and in the secondary cities of Penang, Ipoh, and Johor at least once a year.
  
• Value-add or competitive pricing offers during the low season travel period (March to August) are useful to trigger tactical campaigns with travel agents in particular consumer travel fairs in March.
  
• For more general information on sales calls and planning a visit to market, please see Tourism Australia’s 'Tourism Export Toolkit'.