Hotel Blogs

OSSN has posted RCL's statement about decertifying certain agencies.

An excerpt:

The significant problems associated with this growing segment of the agency distribution system [i.e. card mills] are numerous and include the following:
• They can lead to negative consumer experiences with these untrained agents, undermining the integrity and business reputations of accredited and certified travel agents.
• They can devalue the knowledge, experience and expertise that legitimate, professional travel agents provide their clients every day.
• They can substantially increase the costs of our operations by causing us to provide costly and valuable benefits to a set of persons or entities for which those benefits were not intended.
• They can create an environment in which the traditional and full set of services we expect a travel agency to provide to consumers are, in fact, not provided, despite the payment of a full commission in connection with the booking.
• They can mislead normal consumers with unrealistic expectations of "travel-agency-only benefits” when, in fact, they are not travel agents.

In addition, the rapid growth of this segment combined with the lack of control over members by these agency headquarter organizations accelerates the necessity for swift action on our organization's part to curtail the expansion of this disruptive and destructive market segment.

Ouch!

Here's an excerpt from an interesting (to say the least!) letter that Royal Caribbean Cruise Lines is sending to its travel partners.

We are writing to provide you with important information regarding the new manner in which we will be dealing with certain travel-related business practices.

Royal Caribbean International®, Celebrity Cruises® and Azamara CruisesSM have begun terminating our business relationships with certain travel-related companies that we have concluded are in the "card-mill" business (selling ordinary consumers access to benefits designed for actual travel agents). We have a fundamental concern with the business practices of these companies.

I have been writing about this practice for well over ten years and devote considerable attention to the issue in my travel agent course.

While the traditional travel agent community has been vocal in opposing the practice of issuing ID cards to anyone willing to pay for them, other segments of the industry, such as ARC, IATA and IATAN which could effectively put so-called card mills out of business should they wish to do so, have not taken action.

The fact that these companies have not been prohibited by the authorities, despite lawsuits and other attempts to shut them down, leads me to the conclusion that, whatever you may think of so-called card mills, they are legal.

The key to ending card mills rests with the suppliers. But have suppliers been not particularly keen on policing their own fam and discount policies. Yes, airlines will not "honor" such cards for upgrades and such, but airlines don't honor much of anything these days. RCL's initiative could change that.

It will be interesting to see how this plays out in the travel trade press over the coming weeks and whether or not RCL's stance will "go viral" within the ranks of travel suppliers. If it does, the business of model of more than a few host agencies will become effectively obsolete, although I suspect they will not immediately fold their tents and slink off. Most agencies that use the referral agent model (a nicer way of saying "card mill") have long had fine print that counsels their agents that industry benefits are at the discretion of the supplier and instructs their agents not to complain if their request for a discount is denied.

It would also be interesting to know exactly which companies RCL has in mind (the letter doesn't say). I suspect that they will not take action against all the host agencies that critics label as card mills. Some of them produce significant volume for the cruise lines, even if most of the bookings are for their own agents.

One of the closely guarded secrets of the referral agencies is that the cruise "fams" they offer to their agents are often not especially good deals. Cheap, yes. But the cruise lines are often charging the agents in question the same price they'd give to virtually any group of that size. In other words, if all you're interested in is a bargain, with a little smart shopping you can get the same deal without shelling out money for an ID card.

Then, too, there will always be suppliers who will provide discounts, knowingly or otherwise. My guess is that people who acquire these cards will still get "travel agent rates" at hotels without ever knowing what the actual travel agent rate is or that they could have gotten exactly the same rate by flashing their AAA card. And, of course, there are still hotel desk clerks who cannot tell a real IATAN card from a lookalike.

I also think it's important to note that this action by RCL, even if copied by other cruise lines and tour operators, will not do anything to stem the growth of the home-based travel agent sector. If anything, it will help us grow both in numbers and professionalism.

It is astonishingly easy to meet the minimum requirements to be taken seriously by the travel industry. Not only that, but doing so often costs less than the price of those ID cards! It is only slightly more difficult to start earning significant income by producing actual bookings for suppliers, including RCL, who are more than happy to extend industry courtesies to their actual "partners." In fact, I will be going on an RCL fam cruise to Bermuda in a few short weeks!

If you are reading this because you are interested in becoming a home-based travel agent, I urge you to educate yourself by signing up for my free six-part mini-course for wannabe home-based travel agents (scroll down when you get there). And while you're there, sign up for my equally free bi-weekly newsletter.