STA's latest data on service fees show
that 88% of the society's members charge fees for some or all of
their services and have not lost significant business as a result.
We think that's pretty good news, and ASTA rightly presents it
as clear evidence that travelers value the services of travel
agents and are willing to pay a fee for the benefit of their
expertise and experience.
Not so long ago, many travel agents feared that service fees would
drive their customers away or send a signal to suppliers that
agents could get by on reduced commissions.
Those concerns have dissipated in the face of harsh economic
realities, to the point that it's a rare agency these days that
doesn't charge for producing an airline ticket. And not only have
more agents adopted fees, agents are not being shy about increasing
them when necessary.
Prior to the first commission cap in 1995, only 20% of ASTA
members charged service fees of any kind. After the 1997 commission
cut, that number started to grow dramatically, rising to 64% in
1998, to 75% in 1999 and to 88% in 2000.
What surprises us in the latest report is a statistically
insignificant drop in 2001 to 87.8%, suggesting that the trend line
suddenly flattened out.
We don't know what to make of that, but, clearly, this is a
number that bears watching.
And speaking of flat, there are more than a few flat and sagging
numbers in ARC's latest monthly report on agency air sales. April's
domestic air sales were down 9% from a year ago. For the first four
months, agency air sales were up a mere 0.5%.
We don't know whether these numbers reflect the general
softening of the airline business or agents' diminishing
participation in it, or both.
But this, too, bears watching.