LONG BEACH, Calif. -- Calling rebating "a chronic problem that
threatens the industry," Avoya executive vice president Jeff Anderson not
only appealed to suppliers to "level the playing field," but outlined
a plan to help them identify the worst offenders.
Rebates reduce profitability for agencies that play by the
rules and wastes the time of both agents and suppliers who must rebook
clients as a consequence of rebating, Anderson said.
Ashley Hunter, Avoya's vice president of business development,
said rebating is beginning to occur in the deluxe and luxury categories where
it hadn't been a problem before. She has seen some instances where agencies
will rebate the entire commission.
A combination of preventative measures and penalties can be
effective for curbing rebating, Anderson said, and Avoya will provide
intelligence on who is rebating and by how much. "We want to switch from
anecdotal to evidential reporting (of abuses) to suppliers," Anderson
Avoya agencies are often compelled to rebate themselves,
Anderson acknowledged, either by price-matching or, when it's widely known that
prices of certain products almost always reflect rebating discounts, proactively coming out with a discounted price. Avoya will share in
the cost in cases of defensive rebating, Anderson
An example of a preventative move is a policy instituted by
AmaWaterways to require an invoice showing payment in full. While it's possible
for an agency to then write a check to the traveler as a form of rebate,
AmaWaterways vice president of sales and co-owner Gary Murphy said the policy
has significantly reduced rebating on its river cruises.
To penalize rebaters, Anderson said, suppliers should tell
rebaters that if they don't need all the commission they're being paid, it will
be reduced by the amount they rebate.
The discussion of rebating arose as an offshoot of a
discussion on "deep collaboration with partners," the first of four "mission
objectives" Avoya plans to focus on between now and 2025. The others are
to inspire travelers to explore more, create life-giving technologies and
provide distinct experiences for their clients.
Avoya recently filed a third patent for its latest
technology, said co-founder Van Anderson. It will reflect changes to its
software programs that will streamline the company's ability to match prospects
with the right agents in its network and improvements in applications that
communicate with suppliers for the purpose of sharing and analyzing
performance, with the goal of making collaboration more efficient.
The cruise category currently makes up 70% of the company
sales, Jeff Anderson said, but the company plans to diversify its supplier
relations into new areas in 2018.
Senior vice president of marketing Sam McCully also revealed
that the company plans to create a loyalty program for its clients that would
integrate with supplier loyalty programs.