Just finished this and realized that one of my most loyal readers will say I am being verbose and on this subject, I plead guilty. I’m just trying to understand this one thing that frustrates me no end—always has.
I need to write about something I have never understood. People asking or worse, expecting, travel agents to give them money or something else of value for booking their travel for them. Travel agents already work for clients for free.
This last week I received an e-mail from a very nice person asking me about a cruise. She had waited until the last minute (a Viking Ocean cruise this summer—these are usually sold out a year in advance) and wanted me to see if I could find her a stateroom—that maybe there was a cancellation. She did give me the exact date of the cruise and exactly the kind of stateroom she wanted, which I appreciated.
I called Viking and spent about an hour on the phone with them while the excellent customer service rep tried to find me the exact stateroom she was looking for on a sold-out ship. He was able to find a stateroom in the same category she wanted but before he could grab it, another of their customer service reps grabbed it for a client who had money in hand. Boo! We almost had it. But my agent did promise to check that cruise on a regular basis between now and when it sailed in July and let me know if there were any cancellations. The last date for people to cancel with a full refund was approaching and often if staterooms are going to open up, that’s when they will do it.
I got back to the client and told her everything that had happened and that we would continue looking. She was very appreciative and I told her that I would contact her if anything came open. In the meantime she promised to send me all her passenger info so I could be ready to book it if they called, so we didn’t lose it again. Sounded good to me.
But the next morning there was an e-mail from her asking me, “Jim, to clarify/confirm: You do offer the Viking-allowed OBC, correct?” I wasn’t sure what she meant by that so I asked her to clarify. She got back to me with this: “Viking is strict with its agents, as I’m sure you know, limiting how much “rebate” they are allowed to give to their clients. The most above-board thing that agents tend to do is give OBC up to the limit Viking allows – which varies by voyage. Some agents also do provide additional $$ in the form of cash rebates, but that is not technically allowed under Viking’s policy, and the agents who do it are (obviously) paying it out of their own proceeds. So, I never expect or ask for any cash rebate, since it’s technically against Viking’s policy. I’m content to stick with the maximum OBC per voyage (it’s based on length of voyage.)”
Well I had heard about Viking’s OBC rules but I had never looked into this policy because I don’t believe in giving clients cash or on-board credit back. In the travel industry, this is a standard practice that I have never understood. Some of my best friends go looking for it and that saddens me as well.
At our agency, we make 38% of the 15% commission that pretty much every cruise line pays. The other 62% of the 15% the cruise line pays goes to our franchise owner for him to run the business. That means on every $1000 dollars of travel I handle, I get $57. So if you buy a $10K cruise I get $570.
That would be great but most cruises we sell are around $3-4000. And the cruise lines have this nice little thing called NCF (non-commisionable funds) which are parts of the cost of the cruise that we don’t make commission on. We also don’t get commission on taxes and port fees which can be a significant cost as well. (Last year I had a $1500 cruise that had almost $1000 of NCF and port fees on it). I think I made $30 on that one. Took me a bunch of time because the client was a first time cruiser. On those, I might make $100 if I am lucky (after expenses). Any OBC you get from us that is not directly from Viking (or any other cruise line) comes out of my pocket. If I give every client back even $100 OBC, I end up averaging less than $100 per cruise booked. Since from initial contact to the client returning from their trip, I spend about 20-30 hours working for that client, that means I make $4 to $5 an hour.
So why do I do this? Because I love travel, I love cruising, I love helping people plan travel and in general I like doing all of that really well. And luckily for my bride and I we have enough money coming in to let us do that. (I have another business that helps).
Before we started doing this, we used a travel agent (who is still a close friend) for more than 20 years and I never once asked her for anything off on a cruise or any OBC. She would always send a bottle of wine, a fruit plate or some flowers to our stateroom, she would give us cool Disney stuff to give to our grandkids and once passed on an Azamara bathrobe, but I never expected anything from her other than the superb service and knowledge she brought to our traveling. I knew that any OBC came right out of her pocket and that she did great work for us. She took care of us.
There are lots of online agencies that will give you almost half their commission back. I know of one that on a Viking cruise they will normally give $1000 OBC if you book a suite. But those agents are employees making close to minimum wage. Most have never taken a cruise let alone traveled outside the country. If they research a cruise for you, they are getting paid whether you buy it or not. If you get into trouble while traveling, good luck trying to get a hold of a particular agent for changes or problems. You just get to explain your entire problem again. And if you are on your trip, can you call that agent on their cell phone for help? I doubt it. My clients can…and I could call my old agent.
I do have a question for all of you as you look for a TA that will give you OBC. When you go to a doctor, dentist, lawyer, etc. in order to avail yourself of their expertise, do you ask them for a rebate? If you sell something or provide a service, or when you do whatever it is that you do for one of your customers or clients, do they ask you to give them money back? I wish I had thought of this when my I had my rotator cuff surgery a few years back. I should have asked my surgeon for some of the $20K that surgery was worth. (That sounds pretty ridiculous, right?) Why do people do this with travel agents. I just don’t understand.
My clients use my services because we have travelled extensively and I can make recommendations on cruises, staterooms, tours, restaurants and hotels. Your primary goal of using an agent should be the same reason I did for 20+ years of traveling. Because when things go wrong, she was there. When things went bad with a flight at Heathrow and she found us seats home or when we wanted to book a “cheap cruise” on a cruise line I now never recommend, she told us that we wouldn’t like the cruise line we had chosen (we went anyway) and she was right—we hated it but she never said “I told you so.” I do the same thing for my clients.
Lastly, I love doing things for my clients but I want the things I do to be more than “money they are expecting.” I like sending clients wine or getting them a dinner at a speciality restaurant. But I do that as a special gift so they will enjoy the cruise even more. I truly believe when you don’t expect something, you like it even more.
So if you can explain to me why this goes on, please do.
If you accept the expectations of others, especially negative ones, then you never will change the outcome. —Michael Jordan
Ok, so this potential Viking Cruise client was expecting extra OBC?! Because she was using your agency?! Hmmm! Nope, nada, never
What did you tell her when she asked? And do you gift something in the stateroom even for low priced cruises? Asking for a friend 🙂
I do it for almost anyone depending on how I feel about the amount of work they made me do and how easy they were to work with. Cost of trip isn’t a determiner.
To answer your first question, I told her I didn’t do that and she should find herself a different agent. I even mentioned one I knew would give her the OBC she was looking for. She told me that she had used them before and the service was terrible. She went and proved my point for me. But the $200 OBC was worth more to her than good service. Good riddance to her.
Verbose…..?? Not as bad as some. Lol. Easy answer to your question. If the customer can get a cheaper price on a cruise and get the SAME OR BETTER satisfaction out of the whole deal why would they not do that? Would you not like to get me a better price as my agent? So the customer is not always right but he/she is always the customer. Don’t over think the process. Let’s discuss tipping next. 😏.
You can not compare a Doc who fixed your shoulder to an unnecessary luxury item like a cruise.
Sure I can. The doctor has a specific set of skills and so do I. I use my skills for something that costs a lot less money and I get paid a lot less for doing it yet some people feel I should still give them back what little I make, And if someone wants a cheaper experience but no advice or expertise (or they can do it themselves) more power to them. I value everything Norma Jean ever did for us and even if she didn’t have the cheapest price, I would always book with her.
It is my understanding that Royal does not allow agents to discount their prices so travel agents offer OBC to be competitive. Some offer other perks (parking, specialty restaurants, tours) instead. I am not aware how other cruise lines do this since I only cruise Royal and Celebrity (and AmaWaterways). That said, I do not “shop”, nor do I ask. I have been pretty loyal to my agent who has always treated me fairly. It’s his livelihood but I do expect something, as little as $25-$50 on a transatlantic up to about $500 on a river cruise. As I said, I don’t ask nor do I “bargain”. With my repeat business, it’s a win-win.
I wish my agent would monitor prices to let me know that the price has dropped. He doesn’t but that’s not a reason for me to leave. I just rely on myself to monitor.
Pretty much none of the cruise lines will let anyone discount them. All you can do is offer perks. Even Costco can’t cut the cost of a room. You can do so if you have a group booking and a lot of the big agencies will form groups (these people may never know they are part of a group) to get better pricing. I have a few people sailing on our next cruise in an agency group. It does get them better pricing.
I love your loyalty to your current TA. I have that with just about every business I work with. We have been using the same plumber or 20 years and I wouldn’t think of looking around to find a cheaper plumber. They come out when I call them (even on Christmas Eve one year) and they charge us fairly. Loyalty means a lot to me.