Want some insight on travel agents? Read this USA Today article!
Apr 12th, 2000, 12:38 PM
#1
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Want some insight on travel agents? Read this USA Today article!
For those of you insisting that travel agents make no money, do not steer people towards certain items, and are not threatened by the internet, read this "USA Today" article dated October 19, 1999:
Travel agents: Are they selling you service,
or selling you out?
"Internet-savvy yuppies may know there's a financial incentive (to book one supplier over another), but a lot of older people don't. They come to a travel agent for advice and counseling, and think it's freely given. It's not." --Travel agent Richard Turen of Naperville, Ill.
By Laura Bly, USA TODAY
Can you trust a travel agent to provide unbiased advice?
As the travel industry's financially squeezed middlemen scramble to survive in a turbulent market, a longstanding debate over how agents earn their money -- and whose interests they represent -- is intensifying.
Last month, the U.S. Department of Transportation's inspector general urged the department to make travel agencies tell clients if airlines offer them financial incentives to steer passengers their way --including override, or bonus, commissions of 2% to 6% above the industry standard of 8% or $50 a ticket. Travel agents argue that many corporate agencies, which earn the majority of airline overrides, already disclose such incentives to their customers.
And the inspector general's report acknowledged its probe turned up "no
direct evidence" that travel agencies have misled clients; neither did a 1994-1996 investigation by the Justice Department.
What's more, says Ed Perkins, consumer advocate for the American Society of Travel Agents (ASTA) and former editor of Consumer
Reports Travel Letter, "point-to-point airline tickets have become a commodity" driven by price, schedule and frequent flier memberships, not by agents.
The small amount of money generated by override commissions, which aren't guaranteed and are based on an agency's share of a regional market, aren't enough to risk losing customer loyalty, Perkins adds.
But the inspector general's recommendation, now under consideration by the DOT, highlights a thorny issue.
Faced with steep cuts in the airline commissions that have provided the
bulk of their income, vacation-oriented agencies are selling fewer airline
tickets in favor of tours and cruises, which haven't trimmed agent commissions.
No longer touting themselves as impartial advisers on everything from South Pacific cruises to kid-friendly London hotels, more agents are narrowing their focus, adding consumer service fees and boosting their
reliance on travel companies that, like the airlines, pay bonus commissions for directing sales (of up to 8%). In one recent industry poll, 76% of agents said they were concentrating more on using such "preferred
suppliers."
Hawaii specialist Classic Custom Vacations/Haddon Holidays reminded a
recent gathering of travel agents that once those agents forge an agreement
with a preferred supplier, they're expected to deliver the goods.
"We don't pay you overrides for you to be unbiased," the trade publication Travel Weekly quoted president Ron Letterman as telling the agents.
An increasing financial dependence on suppliers "is the travel industry's
dirty little secret," says Richard Turen, owner of Churchill and Turen, a leisure travel agency in Naperville, Ill.
"There's a definite downside to these strong preferred-supplier relationships. Internet-savvy yuppies may know there's a financial incentive (to book one supplier over another), but a lot of older people don't," Turen adds. "They come to a travel agent for advice and counseling, and
think it's freely given. It's not."
San Diego-based Cruise Vacation Professionals has taken the preferred-supplier relationship one step further. Staffed by home-based
agents, the new company sells only cruises affiliated with Carnival Corp.,
which owns or maintains a majority interest in Carnival, Holland America, Windstar, Cunard, Seabourn and Costa.
"We're the travel industry equivalent of a car dealership. Certainly, we have a bias," says Michael London of Cruise Vacation Professionals. "But as a consumer, I'd rather buy from someone when I know their agenda."
Agents insist that no matter how they're paid, their primary loyalty is to the
traveler. They say they choose suppliers based on how well they meet clients' needs, and any resulting agreements offer consumer benefits, too -- from free upgrades to a swift response should the trip go awry.
"If agents don't take care of their clients first, those clients will go somewhere else. That's a pretty powerful discipline," adds Travel Weekly editor Nadine Godwin.
But some observers think the rapid rise of the Internet as an information source, coupled with suppliers' efforts to sell direct to consumers, will prompt agencies to try more unconventional approaches.
ASTA's Perkins says leisure agencies should consider operating on a corporate model, rebating commissions but charging research and transaction fees. That way, he says, agents could "explore emerging off-price markets that aren't commissionable."
"It's a very fluid marketplace right now," adds Perkins, "and I don't think anyone knows where it's going to end up."
Travel agents: Are they selling you service,
or selling you out?
"Internet-savvy yuppies may know there's a financial incentive (to book one supplier over another), but a lot of older people don't. They come to a travel agent for advice and counseling, and think it's freely given. It's not." --Travel agent Richard Turen of Naperville, Ill.
By Laura Bly, USA TODAY
Can you trust a travel agent to provide unbiased advice?
As the travel industry's financially squeezed middlemen scramble to survive in a turbulent market, a longstanding debate over how agents earn their money -- and whose interests they represent -- is intensifying.
Last month, the U.S. Department of Transportation's inspector general urged the department to make travel agencies tell clients if airlines offer them financial incentives to steer passengers their way --including override, or bonus, commissions of 2% to 6% above the industry standard of 8% or $50 a ticket. Travel agents argue that many corporate agencies, which earn the majority of airline overrides, already disclose such incentives to their customers.
And the inspector general's report acknowledged its probe turned up "no
direct evidence" that travel agencies have misled clients; neither did a 1994-1996 investigation by the Justice Department.
What's more, says Ed Perkins, consumer advocate for the American Society of Travel Agents (ASTA) and former editor of Consumer
Reports Travel Letter, "point-to-point airline tickets have become a commodity" driven by price, schedule and frequent flier memberships, not by agents.
The small amount of money generated by override commissions, which aren't guaranteed and are based on an agency's share of a regional market, aren't enough to risk losing customer loyalty, Perkins adds.
But the inspector general's recommendation, now under consideration by the DOT, highlights a thorny issue.
Faced with steep cuts in the airline commissions that have provided the
bulk of their income, vacation-oriented agencies are selling fewer airline
tickets in favor of tours and cruises, which haven't trimmed agent commissions.
No longer touting themselves as impartial advisers on everything from South Pacific cruises to kid-friendly London hotels, more agents are narrowing their focus, adding consumer service fees and boosting their
reliance on travel companies that, like the airlines, pay bonus commissions for directing sales (of up to 8%). In one recent industry poll, 76% of agents said they were concentrating more on using such "preferred
suppliers."
Hawaii specialist Classic Custom Vacations/Haddon Holidays reminded a
recent gathering of travel agents that once those agents forge an agreement
with a preferred supplier, they're expected to deliver the goods.
"We don't pay you overrides for you to be unbiased," the trade publication Travel Weekly quoted president Ron Letterman as telling the agents.
An increasing financial dependence on suppliers "is the travel industry's
dirty little secret," says Richard Turen, owner of Churchill and Turen, a leisure travel agency in Naperville, Ill.
"There's a definite downside to these strong preferred-supplier relationships. Internet-savvy yuppies may know there's a financial incentive (to book one supplier over another), but a lot of older people don't," Turen adds. "They come to a travel agent for advice and counseling, and
think it's freely given. It's not."
San Diego-based Cruise Vacation Professionals has taken the preferred-supplier relationship one step further. Staffed by home-based
agents, the new company sells only cruises affiliated with Carnival Corp.,
which owns or maintains a majority interest in Carnival, Holland America, Windstar, Cunard, Seabourn and Costa.
"We're the travel industry equivalent of a car dealership. Certainly, we have a bias," says Michael London of Cruise Vacation Professionals. "But as a consumer, I'd rather buy from someone when I know their agenda."
Agents insist that no matter how they're paid, their primary loyalty is to the
traveler. They say they choose suppliers based on how well they meet clients' needs, and any resulting agreements offer consumer benefits, too -- from free upgrades to a swift response should the trip go awry.
"If agents don't take care of their clients first, those clients will go somewhere else. That's a pretty powerful discipline," adds Travel Weekly editor Nadine Godwin.
But some observers think the rapid rise of the Internet as an information source, coupled with suppliers' efforts to sell direct to consumers, will prompt agencies to try more unconventional approaches.
ASTA's Perkins says leisure agencies should consider operating on a corporate model, rebating commissions but charging research and transaction fees. That way, he says, agents could "explore emerging off-price markets that aren't commissionable."
"It's a very fluid marketplace right now," adds Perkins, "and I don't think anyone knows where it's going to end up."
Apr 12th, 2000, 12:49 PM
#2
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Well, you've told us what we already know...those who understand and have access to the internet use it! Airlines, hotels and other travel industry businesses are offering discounts for web-based bookings, probably because it cuts their employee labor costs and the commissions they used to have to pay travel agents.
All agents, whether real estate, travel or whatever, are there to earn the most possible money for themselves, whether it's in a consumer's best interest or not.
All agents, whether real estate, travel or whatever, are there to earn the most possible money for themselves, whether it's in a consumer's best interest or not.
Apr 12th, 2000, 01:14 PM
#3
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I have used a travel agent because she has consistently come up with prices I did not find on Internet. I missed them, somehow. So, for domestic airfares, I find her to be another resource. If she can find me low fares that I would otherwise miss,then the fee she charges pays for itself and leaves
a little over.
a little over.
Apr 12th, 2000, 02:36 PM
#4
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In my experience, travel agents won't give you the time of day unless you are interested in tours, cruises or packages, just like the article suggests. Even if you are not interested in them at all, they try to "steer" you towards them.
I'll never use an agent again. I can book direct and find my own deals without wondering whether I'm being "guided" or "steered" toward something that is going to profit the agent.
Incidentally, I read an article some time ago which stated that the higher the level of household income, the more likely the use of the internet to book travel. Kind of telling, isn't it?
I'll never use an agent again. I can book direct and find my own deals without wondering whether I'm being "guided" or "steered" toward something that is going to profit the agent.
Incidentally, I read an article some time ago which stated that the higher the level of household income, the more likely the use of the internet to book travel. Kind of telling, isn't it?
Apr 12th, 2000, 05:27 PM
#5
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Bob Brown:
A travel agent shouldn't be able to beat your best internet fare very often. The key is that it's hard to learn all the 'little tricks' that cut fares to a minimum, like low traffic dates, days of the week, lesser used adjacent airports (BWI instead of Reagan, Manchester instead of Logan, etc), fare specials with restrictions and the like. There are times when an agent has delivered fares I couldn't get also, but those times are few (most recently during a 'sold out' period for a major sporting event).
A travel agent shouldn't be able to beat your best internet fare very often. The key is that it's hard to learn all the 'little tricks' that cut fares to a minimum, like low traffic dates, days of the week, lesser used adjacent airports (BWI instead of Reagan, Manchester instead of Logan, etc), fare specials with restrictions and the like. There are times when an agent has delivered fares I couldn't get also, but those times are few (most recently during a 'sold out' period for a major sporting event).
Apr 12th, 2000, 06:50 PM
#6
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Since folks on this forum are taking such glee in enforcing the rule about no advertising on the forum, perhaps we could also start enforcing the rule about not posting things that are not yours, i.e. copyrighted material. A URL would have been sufficient.
Apr 12th, 2000, 07:00 PM
#7
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Yes, agents are really able to take advantage of those who lack internet access or computer skills, primarily older folks. Those are the people who don't know how many do-it-yourself options are out there which allow you to choose your destination, type of travel and get the best deals to boot.
Carmen, is right -- with a little insight and know-how about peak travel times and so forth, anyone can beat a travel agent's prices any time.
Carmen, is right -- with a little insight and know-how about peak travel times and so forth, anyone can beat a travel agent's prices any time.
Apr 12th, 2000, 09:35 PM
#8
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My husband and I had our honeymoon basically "ruined" by an "unbiased" travel agent. My darling husband decided to use a specialist travel agent (a very large chain company) that deals only with Australia. He wanted to make our special trip perfect, so he went to the professionals to help him out, they would be more knowledgeable, right?
Wrong! It was so obvious that they did not take our interests, age, occasion, and lifestyle in consideration in the places they sent us to. Some of the hotels were downright awful (2 double beds on our honeymoon? -this happened in 2 hotels), one location in particular we were left wondering why on earth the agent sent us there.
It was so transparent that the agent sent us only to places they had some sort of deal with. That is why I get most of my travel advice from message boards now and from my own research. I will never use a travel agent again. As far as I'm concerned travel agents have seen to their own demise.
Wrong! It was so obvious that they did not take our interests, age, occasion, and lifestyle in consideration in the places they sent us to. Some of the hotels were downright awful (2 double beds on our honeymoon? -this happened in 2 hotels), one location in particular we were left wondering why on earth the agent sent us there.
It was so transparent that the agent sent us only to places they had some sort of deal with. That is why I get most of my travel advice from message boards now and from my own research. I will never use a travel agent again. As far as I'm concerned travel agents have seen to their own demise.
Apr 13th, 2000, 09:15 AM
#9
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Not all travel agents are so unscrupulous. If you find you require their services, don't just pick one out of the phone book. Ask for recomendations from friends, check with the better business bureau, etc. In the days before the internet, I used a travel agent recommended by several friends. She consistently found fares that were lower than what I could find by calling the airlines myself. She took the time to find out my interests when helping me plan a trip. But I did not rely soley on her. I did my own research as well. Over the years I developed a great relationship with her, and now I have to say I feel guilty about booking through the internet, and depriving her of the commission she honestly deserved when I dealt through her.
Just as with any business, there are some unscrupulous agents, but there are also many professionals concerned about their customers and the products they provide. Take the time to find them.
P.S. Before anyone accuses, I am an investment banker, not a travel agent.
Just as with any business, there are some unscrupulous agents, but there are also many professionals concerned about their customers and the products they provide. Take the time to find them.
P.S. Before anyone accuses, I am an investment banker, not a travel agent.
Apr 13th, 2000, 09:56 AM
#10
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This reminds of a book title, one that I read as a teenager -- "That Was Then, This is Now."
The world of travel has changed, largely in part due to the internet. Agents who were once a primary or sole source of travel resources and bookings have watched their customers and commissions disappear, because consumers now have an array of choices. I'm sure it's frightening, but when they all hang around the travel sites and promote the tours, hotels and all that pay them to do so, it's irritating. It's also sneaky and underhanded, especially when consumers have told them by their lack of patronage that their services are no longer wanted or even trusted.
That's the way of the world -- things change. The world does not owe travel agents or anyone else a living. If they can no longer turn a profit in a business, then find a new line of business.
The world of travel has changed, largely in part due to the internet. Agents who were once a primary or sole source of travel resources and bookings have watched their customers and commissions disappear, because consumers now have an array of choices. I'm sure it's frightening, but when they all hang around the travel sites and promote the tours, hotels and all that pay them to do so, it's irritating. It's also sneaky and underhanded, especially when consumers have told them by their lack of patronage that their services are no longer wanted or even trusted.
That's the way of the world -- things change. The world does not owe travel agents or anyone else a living. If they can no longer turn a profit in a business, then find a new line of business.
Apr 13th, 2000, 10:11 AM
#11
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The article says the internet and suppliers' efforts to sell direct will "prompt agencies to try more unconventional approaches." How about hanging out on independent travel sites like Fodor's and dispensing "advice" undercover as if you were just a traveler instead of an agent? I've seen agents here claim they were just downplaying their true profession in an effort to provide real service! Oh, please. Are these agents trying to undermine the integrity of travel sites, recapture lost customers, or both?
I applaud Fodor's and the steps they take to ensure integrity and an honest exchange of information here.
I applaud Fodor's and the steps they take to ensure integrity and an honest exchange of information here.
Apr 13th, 2000, 01:05 PM
#12
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Commissions aren't the only reason for steering people towards certain businesses. These businesses also provide lots of free perks to travel agents in the form of "fam trips" (familiarization trips) which are ostensibly created for the agent to familiarize him/herself with an area. The truth is, these businesses (hotels, restaurants, etc..) expect something in return for these perks -- the agents either steer clients to the perk-providing businesses or the perks go away. Many, many agents got into the business precisely to take advantage of free travel and other bonuses.
So, when you see these agents here pretending to be regular folk, just remember what their incentive is to "recommend" hotels, restaurants and tours to you, and JUST SAY NO to travel agents on this site!
So, when you see these agents here pretending to be regular folk, just remember what their incentive is to "recommend" hotels, restaurants and tours to you, and JUST SAY NO to travel agents on this site!
Apr 13th, 2000, 04:18 PM
#15
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So, You mean to tell us these business
owners simply give all of these perks to agents due to annonymous posts because they say it was them posting them? Hey...If it was that easy, even a simpleton like you could do it.
HAHAHAHAHAHAHAHAHAHAHA...You're funny.
owners simply give all of these perks to agents due to annonymous posts because they say it was them posting them? Hey...If it was that easy, even a simpleton like you could do it.
HAHAHAHAHAHAHAHAHAHAHA...You're funny.
Apr 13th, 2000, 05:28 PM
#16
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Hold on there, noEinstein. It's not that hard to track. If you own a restaurant in Hana, Maui and you've averaged 10 hits a day for 6 months, then Joe travel agent decides he's gonna 'help you out' by posting messages at various travel forums on the web, and hits at the restaurant site double, Joe comes back 10 days later and says asks you to look at the effect of his work. Not too hard to figure out. That's a relatively strict example. If you run a large resort with lots of hits and a large ad budget, doling out comps (free meals, reduced rate rooms) to agents who update you about their activities on your behalf is no big deal. It's a writeoff for the hotel, in fact.
Apr 13th, 2000, 08:11 PM
#17
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I was really trying to sit this one out, because I’m sure that some people will jump all over me merely because I have the nerve to post here, doing what I do for a living, but I truly don’t understand why people seem to think there is always a distinction between “real travelers” and people who are involved in the travel industry. I left a lucrative career as a corporate lawyer because I’m a total travel junkie and I couldn’t deal with only having three weeks vacation a year! So I created a niche for myself, planning trips for people coming to my region, and writing about travel. I do what I love, and make a living at it. I charge an hourly rate for my service like any other professional. I’m lucky enough to travel about six-eight weeks out of the year, mostly on my own dime; since I’m not a traditional TA, I don’t have an IATA card and don’t get those discounts (which are not all they are cracked up to be anyway, according to a good friend who used to have her own agency).
Now, I certainly can’t speak for everyone in the industry who posts here, but my posts have much more to do with my passion for travel and my own ego than with making money. I honestly can’t think of one client I’ve gotten from this site, although I have exchanged quite a few emails with people who have contacted me and have given them more advice without demanding anything in return (I would never DREAM of contacting someone from this forum first. I am very much against unsolicited email and don’t do business with companies who spam me). If I see a question about Seattle, and someone who spent a few days here a couple years ago advises the poster to spend time on the waterfront and eat at the Space Needle, I’m not going to let that go by without adding my $.02! I eat out all the time and keep up with new restaurants, etc.–it’s my business, but I also love to make sure that people coming here get good information (and I’m confident enough of my own opinions and tastes to think that my information IS good!). As far as why I bother spending the time on this forum, well, why do any of us? Travel is my passion, my work, my hobby. I would just as soon read and answer posts about travel as watch TV or do anything else (other than travel!). For those true travel junkies who read or at least peruse most of the posts, you know that I have asked questions and posted about recent travel experiences in NYC and Europe, as well as my home region of the NW.
As far as the idea that I could make money by increasing the number of hits on a B&B or restaurant’s website–wow, that never occurred to me! Guess I better give Wild Ginger a call the next time I mention them; I’m sure they’d be delighted to cut me a check! What have I been thinking? Ok, sorry, my sarcasm got the better of me. Seriously, in my experience, getting hotels to pay commissions even when you’ve actually made bookings with them is like pulling teeth; I really had a good laugh at the idea that I should be calling these places up and asking for money or freebies based on increased website hits! I recommend places on this site because I like them and because I hope I can improve the travel experience of the person asking the question. I’m not hiding anything when I don’t say in my post, “I plan trips and write about the Northwest for a living”; I’m trying not to violate the no advertising rule. I've been a moderator on the Compuserve travel forum for years and know the drill. Unfortunately, it's no longer as lively a place for discussions about travel as it once was, since it was taken over by AOL. This site seems to be the best thing going on the web for good travel information; I certainly wouldn't want to see it deluged by spam and advertising and I don't think it is (with a few obvious exceptions).
Bottom line: I have valuable knowledge and expertise that I love to share with fellow travelers. The fact that I’m lucky enough to make my living doing what I love shouldn’t mean that I can’t voice my opinions here! Don’t take my advice if you don’t agree with my opinions! But I am every bit as “real” a traveler as anyone else here.
Now, I certainly can’t speak for everyone in the industry who posts here, but my posts have much more to do with my passion for travel and my own ego than with making money. I honestly can’t think of one client I’ve gotten from this site, although I have exchanged quite a few emails with people who have contacted me and have given them more advice without demanding anything in return (I would never DREAM of contacting someone from this forum first. I am very much against unsolicited email and don’t do business with companies who spam me). If I see a question about Seattle, and someone who spent a few days here a couple years ago advises the poster to spend time on the waterfront and eat at the Space Needle, I’m not going to let that go by without adding my $.02! I eat out all the time and keep up with new restaurants, etc.–it’s my business, but I also love to make sure that people coming here get good information (and I’m confident enough of my own opinions and tastes to think that my information IS good!). As far as why I bother spending the time on this forum, well, why do any of us? Travel is my passion, my work, my hobby. I would just as soon read and answer posts about travel as watch TV or do anything else (other than travel!). For those true travel junkies who read or at least peruse most of the posts, you know that I have asked questions and posted about recent travel experiences in NYC and Europe, as well as my home region of the NW.
As far as the idea that I could make money by increasing the number of hits on a B&B or restaurant’s website–wow, that never occurred to me! Guess I better give Wild Ginger a call the next time I mention them; I’m sure they’d be delighted to cut me a check! What have I been thinking? Ok, sorry, my sarcasm got the better of me. Seriously, in my experience, getting hotels to pay commissions even when you’ve actually made bookings with them is like pulling teeth; I really had a good laugh at the idea that I should be calling these places up and asking for money or freebies based on increased website hits! I recommend places on this site because I like them and because I hope I can improve the travel experience of the person asking the question. I’m not hiding anything when I don’t say in my post, “I plan trips and write about the Northwest for a living”; I’m trying not to violate the no advertising rule. I've been a moderator on the Compuserve travel forum for years and know the drill. Unfortunately, it's no longer as lively a place for discussions about travel as it once was, since it was taken over by AOL. This site seems to be the best thing going on the web for good travel information; I certainly wouldn't want to see it deluged by spam and advertising and I don't think it is (with a few obvious exceptions).
Bottom line: I have valuable knowledge and expertise that I love to share with fellow travelers. The fact that I’m lucky enough to make my living doing what I love shouldn’t mean that I can’t voice my opinions here! Don’t take my advice if you don’t agree with my opinions! But I am every bit as “real” a traveler as anyone else here.
Apr 14th, 2000, 06:49 AM
#18
Guest
Posts: n/a
Leo, I'm sorry.
I didn't know EVERY restaurant in Hawaii had a website ! Get real.
You still know nothing.I agree with an earlier poster that says YOU are the TRAVEL AGENT that specializes in Caribbean trips and are trying to drive away business from Hawaii.
Now, go away with the nice lady. She has your little "Happy Pills".
I didn't know EVERY restaurant in Hawaii had a website ! Get real.
You still know nothing.I agree with an earlier poster that says YOU are the TRAVEL AGENT that specializes in Caribbean trips and are trying to drive away business from Hawaii.
Now, go away with the nice lady. She has your little "Happy Pills".
Apr 14th, 2000, 07:40 AM
#19
Guest
Posts: n/a
Sheri,
Thanks for explaining exactly what needed to be explained. To think that a travel agent can tell an establishment that they're responsible for hits on that establishment's website, and the agent should be given perks, is ludicrous!
The only real "sin" I have seen on the part of the TA's is MauiHeidi and Scott listing their e-mails and websites, and telling people they could contact them for discounts. I didn't lose any sleep over it, though; (MauiHeidi annoyed me more by constantly bashing the Kihei-Wailea area because she prefers the western part of Maui, which is such a disservice to that gorgeous area on the southern end. Thought that was very unprofessional! Does not seem to respect other's opinions.)
Anyway, thanks, Sheri! Keep up your good work - so happy to converse with you here!
Thanks for explaining exactly what needed to be explained. To think that a travel agent can tell an establishment that they're responsible for hits on that establishment's website, and the agent should be given perks, is ludicrous!
The only real "sin" I have seen on the part of the TA's is MauiHeidi and Scott listing their e-mails and websites, and telling people they could contact them for discounts. I didn't lose any sleep over it, though; (MauiHeidi annoyed me more by constantly bashing the Kihei-Wailea area because she prefers the western part of Maui, which is such a disservice to that gorgeous area on the southern end. Thought that was very unprofessional! Does not seem to respect other's opinions.)
Anyway, thanks, Sheri! Keep up your good work - so happy to converse with you here!
