I have to say that the nation’s news has been talking about the “perfect storm” for the last six months–the housing collapse, the Wall Street collapse and the admission of a recession. Certainly the travel industry has not been exempt. But I think that there may be another “perfect storm” brewing for travel agents. Just as we witnessed a reinvention of the agency model when airline commissions were eliminated, I believe we are on the cusp of some fundamental changes in our industry—and for the most part, my money is betting that they are changes for the good. Only if you are paying attention.
The Card Mill/MLM Issue. As most people know, I have been a vocal opponent of the Card Mill and MLM companies for many years, Hopefully you have had time to check out my blog—MLMs and Travel: A Bad Mix. In this first storm, I see these offensive businesses going away. The suppliers are realizing that the business they provide may not be the business that they want—some heavy hitters have terminated contracts. The Attorney General in California is suing YTB, the largest MLM in travel and is moving forward and pressing hard with his initial intent “to shut down the company’s unlawful operation before more people are exploited by the scam.” And finally, some of the associations that represent the industry are beginning to take a stand. I believe there will be a concerted effort on all fronts to eliminate this scourge—stay tuned for more details. (And yes, that was a hint)
The Customer Service Issue. Over the past few weeks I have participated in several discussions where agents were lamenting the incredibly deep travel discounts available and the impact on commissions and earnings in a recession. The dilemma was, when a supplier drops a price, do you reprice, or let it go? There were two sides to this discussion. One side was adamant to leave the price as originally booked and accept full commission. The other was being proactive and re-booking at a lower price (and lower commission) to provide the service levels they need for their clients. I fell into the latter discussion and I predict those that are married to commissions (and not their clients) will be tossed overboard in this storm because those very clients will be able to achieve a similar lack of service on any number of websites or by going directly to the supplier. Laura Frazier of Bliss Honeymoons wrote a column about charging fees and retainers. The smart agents, I think, will heed her advice.
The Communication Issue. Today’s consumer is so much more technologically savvy that if agents are not able to keep up with the clients, they will be left behind. Email is not enough. I might even venture to say that there is more personal correspondence on Facebook and MySpace than by email. The agents of tomorrow will need to be blogging, Facebooking and Twittering. You will need to touch your client however they want to be touched and likely in multiple ways. Your newsletter might become passé. Remember the monthly paper newsletter? Your information, within the next year will likely reach your clients by electronic feeds. Do you know what a RSS feed is? Do you have a blog? Do you text your clients? If not, or if you think I am speaking in tongues, do a little research on today’s technology–you will be amazed at what is available and how simple it really is. Tomorrow’s travel websites (for agencies) will be more focused on information & community than deals and specials. Steve Cousino, an independent consultant from Missouri has realized this and anticipated his client’s and prospect’s needs and designed a wonderful website for his business. Annie Petronia of Annie’s Escapes has also developed a great informative blog (at zero cost on WordPress) to supplement her main site.
These three tempests are brewing and they will present challenges for everyone. As it was in the late 1990s, we likely will see a lot of consolidation in our industry. The strong will survive. When the MLMs go away, it will be imperative that the legitimate travel agents are prepared to clearly demonstrate the value difference between the MLM and the legitimate agent. With suppliers marketing directly to the clients, agents will need to become serious professionals. They will need to bring value to the transaction and that may indeed include retainers and ultimately losing some commission—if it exists. And finally, if you are not riding the technology wave, you will be left out at sea just floundering.
Well, you just read about 700 words of bad news; but here’s the good news. There is time. I have not mentioned anything that cannot be accomplished now. You can probably get a good leg up with a solid weekend of study and self reflection. If you take four hours and build a free blog, open up a Facebook account and let your clients know, you will be far ahead of your competition. So, the weather is about to turn a little stormy in the travel industry. What are you gonna do about it?
Now about that RSS feed….