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Fire Your Agent
ChrisCrossings · December 2, 1999

Q: When I worked for a hotel chain, I remember a large agency approaching the general manager of our property with a proposition. They wanted a 15 percent commission instead of the standard 10 percent commission. In return, they would book their clients at the full rack rate. As a young manager, my initial reaction was to say that I was glad that I was not a client of the agency.

In 1990, I left the hospitality industry to get an MBA. After my education was completed, I took a position where I traveled on business from 200 to 250 days a year. Guess what agency my company required us to use? That’s right, the same agency.

My company would require that we buy two-week advanced purchase tickets and stay in reasonable hotels. We would stay in the same hotel for weeks. I found that I would get better rates through the hotel front desk than by using the agent.

Then I found out that the corporation was eligible through its contract with Avis for the lowest available rate. However, every week, the agent would book me in at the corporate rate. For example, in Phoenix, the negotiated rate was $216 a week versus $99 a week. I started to book my own car rentals.

The agency personnel made a lot of errors. I flew to Jackson, Tenn., and ended up with a room booked in Jackson, Miss. After two years, I started booking all my own travel, except air. My boss called me in his office to ask why I was not using the agency. When I showed him that my expenses were the lowest in the department, I never heard about it again.

Travel agents want clients who follow all of their suggestions. Most are not willing to investigate other alternatives. The beauty of the Internet is that I can consider all of the options available. Have I made mistakes? Yes. I forgot that I booked a reservation once, costing me $70. But you only do that once, and I save more each year by doing it on my own.

-- Joe Luehrmann

A: I’m glad you wrote, Joe. I think travel agents need to see your letter and make damned sure they don’t do the same thing that your agency did.

Booking a flight or hotel room just because it pays a generous commission is deplorable. I also believe that it’s common in the agency community. Agents who pull this kind of scam over the objections of their clients, and with the direct knowledge that they could be offering a cheaper fare or hotel room, should be summarily expelled from the American Society of Travel Agents the way United Airlines was a few weeks ago.

I’ve spent two weeks on letters from travel agents and I think we’ve covered some of their concerns. Now it’s time to turn our attention to the needs of travelers – something retailers should do more often if they want to survive in this reduced-commission business.

The other day I was asked during a radio interview, “what’s the problem with agencies?” And I found myself saying that at the core of the trouble is the issue of trust. Can you trust an agent to find the best fare? Can you trust an agent to look out for your best interests?

After reading your letter, Joe, I think the answer is, “not always.”

Now let’s be fair about this. Travel agents have to make a living, and if commissions are chopped then they must make up the shortfall by charging service fees. But if I pay a fee, then I want to be absolutely sure that my agent will look out for my best interest. I don’t want that agent to take a commission, because no matter what the agent claims, the bonus creates a bias.

Either the supplier pays the agent or I pay the agent – not both of us.

Many retailers just don’t get it. They believe they can straddle the fence on the issue of compensation. They think it’s possible to serve two masters. Well, it isn’t.

The corporate agency you dealt with – the one that offered to book every traveler at rack rate – is bad for the whole business. It is a reason (though not the only one) that travelers are buying more and more trips online. When you can’t be sure that a travel professional will take care of you, then you have to take care of yourself by dealing directly with a supplier.

It hardly matters that oftentimes, the supplier will quote you an outrageously high fare or room rate. At least you don’t have someone in the middle who is trying to make a quick buck.

Christopher Elliott's column appears on Thursdays. All e-mailed questions to ChrisCrossings become property of Ticked.com and may be edited, condensed or republished at the site's discretion. You may reach Elliott at chris@ticked.com. Or visit his home page at http://www.elliott.org.