If you are looking to get into the travel industry…or if you are already in the travel industry and woke up with a burning desire to read an outstanding article, this is the one for you! Mary Stein and Stephanie Lee from Host Agency Reviews pulled back the curtain on the cockroach of the travel industry—the MLM or network marketing agency.
With my own personal distaste for the MLM crowd, these two women are my travel heroes for 2017. In a very in-depth article, they peeled back the layers of the onion to really give readers a solid insight into the scam, and actionable tips on how to avoid being scammed. In fact, TRO also has a great resource for you!
For those not familiar with MLM and the travel industry, here is a brief history. They are nearly as old as cockroaches—they have been around forever it seems. Typically, since the focus is never on travel, they fly under the radar of even the smallest legitimate travel agency. Does Pepsi pitch a fit about the kid on the corner that sells a single bottle of Coke? But in the mid-2000s a company emerged that grew. And grew. YTB at one point boasted 150,000 travel agents (keep in mind that the number of legitimate agents according to ASTA at the time was less than 40,000) all reportedly selling travel. They issued IATAN cards (and got slapped down), they started to issue their own cards (and got slapped down). They recruited and promised the sun and moon and delivered nothing more than a slight discount on personal travel. The average YTB agent made less than $100 per year in travel commissions. They brought in experts suggesting that as long as you leave a business card anywhere, your expenses could be deducted. Fishbowl at the local TGU Friday’s—yup—customers were everywhere they said. Not only did they get my attention and the industry (Travel Weekly lauded them for several years as a top agency), but they earned the attention of Jerry Brown, then-Attorney General of California who eventually sued them and neutered them. Based on my knowledge, Brown’s office actually hired me to consult with them on their case. After a multi-million dollar settlement and an agreement to vastly change the way they did business, YTB began a three-year slide into obscurity. If you are interested, here is an old blog that I used to write.
Meanwhile, there were some smaller MLM agencies that were still coasting along selling minuscule amounts of travel. And just like the kid on the corner… no one noticed (or cared) that they were selling travel. I am not losing sleep that someone’s Aunt Bertha books a hotel via Priceline and charges them $10 to do it. It is just not worth the effort.
For the past few years, with the MLM agencies somewhat dormant, I focused my attentions on other projects and to be honest, somewhat lost track of the problem. But apparently, like the cockroaches they are, they still live. Instead of YTB, there is Surge 365, Traverus, WorldVenture and Travelution. Dig deep and you will likely see the same people involved. That too is one of the modus operandi of the MLM—fish the pond out and move onto a new pond.
And, as the industry chugs along with one challenge after another, I do have to thank Mary and Stephanie for resurrecting the MLM conversation and, more importantly, for presenting the cautionary tale in such a clear manner. Well done Host Agency Reviews, well done indeed!