ravel agents have become accustomed to
dire warnings, things like, "You're toast," or "You can't compete
with Orbitz." Some of these warnings have taken on the character of
background noise, easily ignored.
But one recent warning, reported in today's Page 1 story about
online cruise retailing, bears repeating. It came from Forrester
Research analyst Henry Harteveldt, who noted that the big Internet
giants like Expedia and Travelocity "play to win."
They're big, well-managed and financially strong; they have
brand names that people recognize; and they're moving into the
cruise business. Harteveldt said, "Travel agencies must work to
shore up their cruise business, or they will lose it."
We think this particular warning rises above the level of
background noise.
It's true that online retailers have only a single-digit market
share, and that they must resort to the telephone half of the time
to close a sale. But the market share is growing, and the
technology is improving. You might not hear footsteps today, but in
five years?
The challenge for traditional agents is, as Harteveldt put it,
to "shore up" their position, to maintain the edge in product
knowledge, customer relationship management and personal service --
while harnessing good technology wherever it can be found.
Cruising has emerged as a safe harbor for many agents, a fairly
easy sell, and a fairly profitable one.
It would be a mistake to take it for granted.
• • •
So sue me!
f current trends continue, the
American Bar Association is going to give the travel industry an
award for its contribution to the legal profession. We are fairly
swimming in lawsuits.
The airlines' commission-cutting antics alone have given rise to
a number of legal actions, including, most notably, the Sarah Hall
class-action antitrust case in North Carolina and the Power Travel
case in New York, which hinges on the question of good faith and
fair dealing. Other groups of agents have cases pending against the
airlines in Ohio and California.
A group of travel agents sued the major car rental companies
over the treatment of noncommissionable charges and add-ons.
The estate of Renaissance Cruises is suing travel agents to
recall commissions. ASTA expects to go to court and sue Renaissance
Cruises to make it stop.
Marriott is dueling with its franchisees. American just settled
with FareChase.
Are travel companies spending far too much time suing each
other?
We recognize that there's a lot of injustice in the world, but
if this keeps up the world is going to start regarding the travel
industry as a collection of shakedown artists. Next time you get
into a beef with somebody else in the industry, whatever you do,
don't say, "So sue me!"
You might get your wish.