Arnie Weissmann
I began Travel Agent Appreciation Day, last Wednesday, May 4, at a press breakfast organized by the American Hotel and Lodging Association (AH&LA), an advocacy group representing property owners, real estate investment trusts and 53,000 hotels, including independents and those in the portfolios of Marriott, Hilton, Hyatt, IHG, Starwood, Wyndham, Four Seasons, Accor and Omni, among others.
Most of the meeting focused on home sharing and OTAs, with the AH&LA pointing out the need for greater consumer education. Alarms were raised not only about the number of professional property management companies that are skirting local lodging laws and regulations by buying apartments for 365-days-a-year "sharing," but also the impact on neighbors and neighborhoods.
The association's CEO, Katherine Lugar, highlighted the case of "Carlos," whose landlord wants to kick him out of his Venice Beach, Calif., home to run "an illegal hotel."
She also talked about websites that mimic official hotel brand sites by adding just one letter to the URL; if a consumer calls an 800 number on the site, the phone is answered, "Front desk" or "Reservations." The unwary consumers don't always get the room or loyalty rewards they expect.
And unlike hotel websites, the full price, inclusive of taxes and fees, might not be revealed until the booking page. Lugar said 15 million bookings affected by "fraudulent websites" resulted in $1.3 billion in "bad bookings."
OTAs were put under the microscope as well. Lugar showed a hub-and-spoke graph detailing the subbrands of Expedia Inc. and Priceline Group, and said most consumers are unaware that although there appear to be multiple choices and brands for hotel booking sites, 95% of bookings come through one of those two umbrellas. Most concerning to Lugar is that bias is being rolled out into these companies' displays, meaning a property can buy a higher display position for online searches.
In response, Lugar called for "greater transparency" and possible Federal Trade Commission regulation of OTA practices. And in conclusion, she said, "the best and safest way to book is direct."
After the presentation, I sat down with Lugar. Given that she had twice said during the presentation that "the best and safest way to book is direct," did she see a difference between the roles of traditional agents and OTAs? Did the AH&LA have any consumer concerns regarding human travel advisers?
"We have a strong and productive relationship with agents," Lugar replied. "They are critical partners. Our focus is on OTAs and rogue third-party sites."
But, she added, "By and large, it's not a secret that the guest is best served by booking direct."
And on the afternoon of Travel Agent Appreciation Day, IHG became the fourth large hotel group to offer discounts to loyalty members who book direct, joining Hilton, Marriott and Hyatt. Although it seems clear the objective of each is to forge closer relationships with guests, most are structured in a way that also reflects sensitivity to agent concerns.
As befits a good advocacy group, the cautionary advice given by the AH&LA was, by and large, self-serving and credible.
But the talking point, the oft-repeated declarative statement that direct booking is "best and safest," timed as it was to the rollout of a number of direct booking initiatives, prompts me to offer to the hotel association some unsolicited cautionary advice on the topic of travel agents.
Five years ago, there was a growing perception among travel advisers that some Carnival Corp. brands were becoming less agent-friendly and that they were trying to build their direct bookings at the expense of agents. While the lines protested it wasn't true, the perception continued to build.
Rather suddenly, cruising as a sector experienced a spate of bad news, much of it related to Carnival brands. The Costa Concordia ran aground. The following year the Carnival Triumph was adrift at sea for days. Positive brand sentiment began to fall.
Initially, Carnival's appeals to agents for help in its time of need largely fell on deaf ears. It took considerable time and effort, but Carnival worked hard to reestablish that it is agent-friendly, and it is once again in good graces with most advisers.
Research has shown that consumers who book with travel advisers take more trips each year, take longer trips and spend more money per day on a trip than those booking through any other channel. It is the highest-margin business a supplier could hope for.
I know many people on the hotel side, including ones working for the companies that recently launched direct-booking discounts, who understand and value what advisers can bring. They advocate for agent interests within their corporations.
I think most advisers understand the need to demonstrate their value to clients to successfully compete with direct booking offers. They don't expect, as they used to, that all business will be guided to them.
Today, hospitality companies are, by and large, experiencing healthy growth and positive outlooks. The sensitivity some companies are showing in their direct-booking rollout could reflect an understanding that their industry is cyclical and that agents have, in times of need, shown themselves to be a remarkable insurance policy.
And the premium they must regularly pay for that insurance?
Nothing more than regular, and truly credible, demonstrations of appreciation.