Don’t get me wrong, there has always been experiential, adventure and transformational travel, nurtured by the likes of Geoffrey Kent and Lars-Eric Lindblad, however, if it wasn’t for Delta Air Lines, it is likely they would still be in very narrow and specific niches, open to only a select few.
In 1995, I was seated in the back of an expansive auditorium in Lisbon. At the front, on the stage, welcomed politely by the hosts, executives of the American Society of Travel Agents or ASTA was Ron Allen, then the Chairman and Chief Executive of Delta Air Lines.
The invitation to have the CEO of a major airline address what was the most influential group of travel agents with some 7,000 present in Lisbon was not unusual. Texas Air’s Frank Lorenzo and American Airlines’ Bob Crandall had been keynote speakers before. What was unusual in this case is that between being invited and that morning in Portugal, Delta had announced it was slashing commissions, capping lucrative pay that was assumed to be the lifeblood of the travel agency community.
While there are always tensions in the distribution chain, airlines and agents were both in a period of rapid expansion despite the ups and downs of our highly volatile industry. In a world before websites, online booking and e-tickets, travel agents saved the airlines hundreds of millions of dollars they would have had to spend on rent and salaries to expand and staff their networks of expensive city ticket offices if they had to pick up the reservations and ticketing agents were doing, at that point well about 80% of airline tickets. The idea of paying commissions to agents made sense on a lot of levels. Unlike having to enter long-term lease agreements, airlines simply paid agents only when they sold their product and even better, after they collected the money!
Of course, Allen must have sensed once the shock wore off, agents would figure a way to make up at least some of the revenue. Charge you customers fees for the tickets you sell them was the call. Before Allen took the stage, some had called for walkouts, anti-Delta signs or whistles, and other forms of protest including disinviting him. Perhaps disappointingly the agents in the audience behaved like true diplomats, taking their beating as ladies and gentlemen.
Right there, we probably all should have known that the way the agency community handled the sensitive moment with such a sense of finesse and class would reflect that two decades later as airline executives are still looking to cut costs, nickel and dime customers and moan about competitors, the travel agency industry, consolidated, is a stronger force than ever at all ends of the spectrum.
For the masses, Expedia, Travelocity and plethora of booking sites have made travel accessible to anyone with an Internet connection. Because of this impressive reach and the ability to sell combinations of airlines and travel products, these sites, largely funded in the beginning by the airlines, are now very much the two-ton gorilla that independent travel agencies never were. Moreover, they sell travel as a commodity making it harder for suppliers to raise prices thus encouraging the plethora of extra services we now pay for that used to be included.
On the other hand, retail travel agents today are a powerful force in selling all sorts of travel to a time-pressed public, particularly at the luxury and premium end of the market where consumers who have less time want more. Creating memorable experiences that last a lifetime or surprises that turn great vacations into the perfect Instagram moment can’t be done by checking off boxes on a web form. Travel advisors, designers, and counselors combine a unique knowledge of what’s out there with what their customers want and most importantly what they want but didn’t know they wanted.
Maybe it’s the difference between being in the corner office of a glass tower and spending your days and nights familiarizing yourself with product and taking the time to know what customers want, not merely how many status miles they’ve flown in the past 12 months.
A couple months ago I was at an event to celebrate the 35th anniversary of Valerie Wilson Travel. In the middle of the toasts, a vice president of Delta came to the podium to pay homage. After he finished, Valerie thanked him, and then brought the house down by adding, “And please make sure to extend my appreciation to Ron Allen.”
Quite right. Without the cuts, travel agents would never have had the business need to innovate and expand their horizons, and the idea of being able to execute experiential and transformation travel on the scale that is has grown to today would not have been possible. In fact, one of the biggest challenges at the travel agency business for the level of agencies that participate in ILTM and TravelWeek is finding new talent to handle the demand from clients who want more than online agencies or suppliers can provide directly. But if you wonder where it all started, look back to Lisbon in 1995.
For more information on transformative travel, and how to build loyalty in today’s complex marketplace, check out the joint ILTM and Skift report: Building Brand Love in Luxury Hospitality.