Last August, the American Society of Travel Advisors issued a dire warning. It estimated 77% of members were facing closure. For travel agents, who have been reading about their demise for more than a quarter century – since Delta Air Lines cut their commissions and Bill Gates boasted Expedia would put them out of business – a global pandemic that brought the entire travel industry to a screeching halt seems to have only made them stronger.
Cranky Flyer reports more than two dozen airlines closed last year. Timeout published a list of 68 popular Chicago restaurants that went out of business during this never-ending pandemic. Icons like the Omni Berkshire Place in New York City shuttered for good.
However, this week in Las Vegas, travel advisors who are part of the Virtuoso network, gathered in-person and virtually, bruised, but far from beaten. They’re seemingly on track to gain a larger share of the luxury travel market.
In fact, Gates’ prognostication is looking more wrong than ever. Advisors say online travel agencies like Expedia are, in part, boosting their fortunes.
In April 2020, The New York Times published a piece, “Why Is Getting a Refund From an Online Travel Agency So Hard?”
More than 150 readers piled on, sharing their stories of poor service.
Sarah Waffle Gavin, a vice president at Expedia, could only tell the paper, “We’re getting hundreds of thousands of more calls on any given day.”
At the outset of the pandemic, travel advisors were overwhelmed too, says Matthew D. Upchurch, chief executive officer of Virtuoso.
Instead of putting clients on hold, they bore down. Advisors provided what he calls “heroic” work, staying up through the night, getting customers stranded abroad back home and helping travelers who weren’t their clients – the ones who couldn’t get through to airlines they booked directly or OTAs.
Advisors also spent hours on hold themselves, pestering and negotiating with suppliers to get clients’ refunds processed.
While revenues at Virtuoso were battered – a spokesperson declined to say how far they fell from the group’s $32 billion peak in 2019 – its network of advisors remains mostly intact. Total advisors declined just 10%, from 22,000 to 20,000, with half of that loss in South America.
Becky Powell, chief strategy officer of Global Travel Collection, which includes Virtuoso member agencies, says, “We’ve seen very few (advisors) leave, and most are retirements,”
In fact, one pre-pandemic trend remains strong. She says, there was an increase in career switchers – lawyers, nurses, and other professionals who decided to leave their cubicles and wards to pursue a career helping you plan enjoyable vacations and celebratory trips.
Powell is among several agency executives who believe the nonstop advertising by OTAs, featuring high-profile actors such as Kaley Cuoco and Rashida Jones, helps bring new clients to traditional advisors. Jones plays a fairy godmother, supposedly saving the day for an Expedia user when her flight is canceled.
The Jones ad closes with the promise, “Like a great companion, Expedia has your back throughout your journey.”
“Customers who hadn’t used a travel agent before or had used an OTA and then had problems…They were stuck on hold; they couldn’t get refunds…We’ve gained a lot of new clients who want high touch service,” Powell says.
Erina Pindar, managing director of SmartFlyer, says the online travel agencies can’t compete with her 275 advisors. “We’re experts in our clients first. Once we understand our clients’ needs, we have the resources to make it happen.”
OTAs were also supposed to capture the next generation of digital forward consumers who supposedly preferred tapping on their iPhones to human interaction.
That hasn’t happened. The New York-based agency’s advisors – Smarties as they are referred to in the industry – skew younger and bring with them their friends and friends of those friends who are young, affluent and passionate about travel.
“Our clients never stopped traveling,” she says. “They switched to domestic destinations last year when borders were shut, but are now going international.” SmartFlyer’s sales are already ahead of 2019 levels, she says.
Like Global Travel Group, Pindar says the agency has continued to attract new advisors.
And while OTAs and suppliers may have big budgets to advertise and public markets to raise capital, advisors, often operating as independent contractors, are fleet-footed entrepreneurs. When the winds change, they’re not hamstrung by thick layers of management.
Joshua Bush, CEO of Avenue Two Travel in Bryn Mawr, outside Philadelphia, invented a technique he calls “trip stacking” during the pandemic.
After booking, canceling, rebooking, and canceling the same trips for clients over and over again, he now leverages flexible cancelation policies to book two different trips for the same client over the same dates, a first and second choice.
If ever-changing travel restrictions nix the top option, his clients are still set to go away. He says clients are buying more, and traveling more, because they then rebook the canceled trip, stacking it again with a second choice for new dates and another vacation.
In Fresno, viewers of the NBC affiliate there are getting something better than empty promises from TV actors. From a corner of the press room, Craig Mungary, owner of Elite Global Journeys, spent the conference taping interviews with executives from luxury travel suppliers. They’re being aired on the station’s local version of Today.
He says the affiliate was thrilled to breakup coverage of high school sports and local politics with previews of new cruise ships and resorts.
With travel more challenging than ever, agents say another benefit of using in-the-know travel advisors is, they are thinking ahead for you.
A big issue these days is showing up at your hotel and finding reduced staffing means limited hours at restaurants and spas. Guests, who are paying high rates, fume there are no time slots for that Peruvian stone and herbal massage they had been longing for.
Tania Swasbrook, president of Travelworld International in San Diego, helps her clients avoid those pitfalls. As soon as they confirm their trips, she starts making spa appointments, arranging tee times and dinner reservations at the hot restaurants.
When she sends them the itinerary with all their favorite activities slotted in, typical response is, “Oh my god, thank you!”
Another challenge for travelers today is it is often hard to assess what level of service to expect when you are planning to go, be it next week or next month.
Powell, who points to Four Seasons, Montage and Auberge Resorts as three groups that have maintained 5-star service despite labor and supply challenges, says before booking, advisors often have candid conversations with hotel managers.
While property websites aren’t always forthcoming about reduced services, she says, “Hotel executives know if they aren’t honest with us, they will lose a lot of business down the road.”
While many companies are still struggling to adapt to work-at-home and debating return to office edicts, Pindar is nonplussed. She notes, “Many of our advisors were working from home before the pandemic. They were already pretty adept at using technology to work remotely.” For that, agents can certainly thank Bill Gates.