e have always embraced the travel agency community," a spokesman for American Airlines told TravelWeekly.com late last month. "They remain a very important channel for selling our product."

This was by way of explanation for why the airline is taking an interest in being a preferred supplier to Vacation.com and Travelsavers, consortia representing small and midsize travel agencies.

Disingenuous or not -- all right, why fudge: Everyone agrees it's disingenuous -- the statement speaks to a business reality that, quite appropriately, has much more to do with money than love.

It'll be difficult to get the straight story from American about why it's suddenly dealing with smaller agencies, but we can get some insight by looking into another company that's very publicly embracing travel agents -- Sceptre Ireland.

Bert Accomando, Sceptre's owner, recently committed to using the travel agency channel exclusively for that brand. Accomando has already left his mark on the way Irish products are sold, forcing some operators to follow his lead in focusing on volume and yield rather than yield alone.

He gave a straightforward explanation for why he decided to pursue agency sales exclusively: "If you looked at it one way, it appeared as if I were making a 35% gross profit on consumer direct sales. But figure in advertising and marketing costs, and the profit becomes a joke. Not only that, but the average sale was 25% less when booked direct, compared with agency sales. That's huge. It became a real issue: We realized that, going direct, we were barely covering our costs."

It should be noted that Sceptre's inventory is obtained from another Accomando-owned company, which also sells to competitive brands that market consumer-direct. But Sceptre's shift toward agents is meaningful -- it represents the biggest piece of its business.

Oddly, in some respects Accomando's embrace of agents is reminiscent of the embrace American has just abandoned. Though he is willing to commit 100% of his marketing dollars to agents, it won't be through consortia or other groups of agencies. "I'm not comfortable with the consortium concept," he said. "I think the person who does the most work should get the reward -- it shouldn't automatically go to someone just because he belongs to a group. I want proactive partners."

He envisions that the "Emerald Partners" who will get his marketing support will be entrepreneurial in approach. "I'm thinking 1,000 agents selling 100 packages each. That'll work for me."

American's and Sceptre's recent moves represent giant steps away from posturing and uncertainty and toward business decisions being made using traditional considerations. The hype of the virtues of traditional agencies on one hand and online agencies on the other is dying down. Channel competition is showing the first real signs of maturation: Traditional agents and online agents are looking for the best deals, regardless of past supplier behavior, and suppliers are looking for the best channel for their product, regardless of whether the channel is thought of as cutting-edge or old-fashioned.

In this new world, it's not travel agents who are suddenly being embraced -- it's rationality.


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