Luxury Travel Advisor drew together a group of some of the most powerful travel advisors on the East Coast for a roundtable discussion in mid-February.
Our participants included Jack Bloch, JB’s World Travel Consultants; Joshua Bush, Avenue Two Travel; Fernando Gonzalez, First in Service Travel; Michael Holtz, SmartFlyer; Kimberly Wilson Wetty, Valerie Wilson Travel and Jack Ezon, Ovation Vacations.
The Travel Corporation, owner of Uniworld, Insight Vacations, Luxury Gold by Insight and Red Carnation Hotels, to name just a few of its brands, kindly hosted the roundtable in its new Manhattan sales office in midtown.
Our conversation spanned the state of the independent contractor market to consumer trends, to setting policies for supplier visits.
Following is a condensed and edited version of the discussion.
Sharing Insights: Joshua Bush of Avenue Two Travel and Jack Bloch of JB’s World Travel Consultants
The general agreement among the advisors was that 2018 started out at a record pace, with advisors working intensely to keep up with the many travel requests for close-in trips, such as Spring Break. But requests for luxury leisure travel are up across the board, extending further out to summer, festive season and even beyond, into 2020.
Ruthanne Terrero: What is surprising you most about your clients these days?
Joshua Bush, Avenue Two Travel: It’s that requests are for 12 days in or more than 12 months out, into 2019 or 2020. Regardless of price point, it can be $100,000 for 12 days in, or it can be $100,000 for 12 months out. It doesn’t matter. The long-term people are still paying a good price, and they want to get results and feedback and information, but we’ve got to drop everything for those who are traveling close in. It’s about having a balance that makes them feel valued in the initial stages even though you’ve got a little bit of time to work it out.
Kimberly Wilson Wetty, Valerie Wilson Travel: And what’s hard, to Josh’s point, is the customer wants to feel that it’s all about them, in that moment. They don’t want to hear that you’re busy with somebody who’s leaving in three days. The challenge is working with our staff on how to properly communicate that message and handle their response times.
Joshua Bush, Avenue Two Travel: The anticipation of the trip is far bigger than the trip itself, for the client. And so, even though they’re not going to travel for over a year, they want that gratification and that attention now.
Ruthanne Terrero: They want to make sure, also, that you’re paying attention to them. Do you try to keep them engaged throughout that year?
Joshua Bush, Avenue Two Travel: Of course. But again, the further out it is, the harder that gets to be. And then it becomes more overhead and more support staff to be able to deliver on it.
Fernando Gonzalez, First in Service Travel: We’re finding a challenge because we are getting really amazing agents, even in other countries [such as Mexico] that we’re in, who have the networks and the potential to do a lot of sales. However, from an independent contractor perspective, they’re also looking to us to support them [on the back end]. There’s a lot of opportunity, and more and more is coming.
Jack Bloch, JB’s World Travel Consultants: Ten years ago, they said no one would be getting into this business and then it completely changed. People who work in other industries were just burnt out and they want to be more passionate about something else, like our business. I would have never thought 10 years ago that it would have changed like this, but it has.
Joshua Bush, Avenue Two Travel: The speed to market for talent is difficult. We’re looking to grow on the employee side more so than on the independent contractor side, so that becomes a capital question. If we’re getting a lot of business I want to be able to keep that in house. On the leisure side, there’s a pipeline that has to build up, even though we’ve got clients who are ready to book. If they’re not traveling for more than a year that means that we don’t get paid for more than a year. We’ve got to be able to support that person through that training. It’s a sizable investment.
Jack Ezon, Ovation Vacations: My question is, are some independent contractors willing to invest in themselves? A lot of them are too myopic. They’re worried about the sale and not investing in their training.
For an independent contractor, it’s a very different approach than an employee, and it’s a growing challenge. And as people are more frequently not in an office dynamic as they’re moving to being virtual, it’s been exacerbated.
Michael Holtz, SmartFlyer: I look at it a little bit differently. We’re very firm with what we expect and if our ICs don’t get to a certain level, we don’t renew their contract. We say, “You know what? We can’t keep you,” because we know what our marginal cost is. We had a conference earlier this year at The Beekman, where we had about 100 ICs fly in. It was a huge success. The only people who were invited are the ones that we think can actually grow the business. The hanger-on-ers, they’re not going to help anyone in this room. We look at our ICs and our house team the same way, and we’re integrating what we’re doing for both. We’re not necessarily looking at them as two different business units, because there’s a lot of crossover. We don’t want to differentiate who’s a house agent and who’s an IC.
We also know that those who use the SmartFlyer brand will always do better than the ones that have their own brand name. And again, as we all know, we can’t argue with people. We need to let people do what they want.
Kimberly Wilson Wetty, Valerie Wilson Travel: Those who use both are smart because they’re benefiting from both. If they identify and brand themselves, coupled with whoever their host agency is, it’s a win, win for that IC. That’s how you pitch it to them.
All Smiles: Advisors at the roundtable agreed that 2018 has started out at a record pace. Above: Jack Ezon and Fernando Gonzalez.
Ruthanne Terrero: Are there any other challenges you’re all seeing in terms of your clients?
Kimberly Wilson Wetty, Valerie Wilson Travel: The world has become much smaller for many people over the years so now it’s about, how do you overcome the, “Been-there factor.” It’s a really interesting thing to overcome when you’re talking to a customer about where they want to go and you spin the globe and they’re like, “Been there, been there.”
But what if you haven’t been to a destination for 10 or 15 years, it’s not the same place. I mean, New York City changes every day. Why would we think another destination wouldn’t? Advisors have to sell the story about what the destination is today, not necessarily how you saw it years ago. Those suppliers who are really good at communicating who they are today and what’s new and hip and changing are the ones that are getting more play.
Jack Bloch, JB’s World Travel Consultants: The experience has changed in that destination. What people thought was an experience then has changed to a different experience now.
Ruthanne Terrero: Have you found that the traveler has changed?
Jack Bloch, JB’s World Travel Consultants: Years ago, they were “tourists” and now they’re going back to the same destinations as a “traveler.” If they went to Paris once, when they go back now they’re getting insider access experiences.
Jack Ezon, Ovation Vacations: I agree with that. It’s a Millennial mindset, meaning Baby Boomers are acting a lot more like Millennials, how much they want to act like kids and party all night and go to places like Ibiza or Mykonos. These are the 50 to 55 year olds and some are in their 60s. I’m like, really?
The surprising thing to me is togetherness. More and more people are traveling with other people; it’s almost an exception to do a trip for a couple. There are multiple couples, multiple generations, bunches of friends, and boys’ and girls’ trips. People are craving connections. They’re having mini-celebrations.
The other thing that I find surprising is a flight from brands. More people are saying, “I don’t want to stay at the Four Seasons.” They want a hotel that has a sense of place. They want something unique. They want to feel like a local and they don’t feel like they’re getting that from the big brands. It’s almost like the late ’80s and early ’90s where they were all big box hotels. Yes, they have come leaps and bounds [since then] to integrate a local feeling in their specific destinations. However, more and more because of the overall corporate culture of those brands — even though it’s unique and the design is amazing and over the top — certain clients are feeling jaded by that experience. They want something more personal.
Jack Bloch, JB’s World Travel Consultants: I think that there’s a flip side to that because hotels like the Four Seasons Surf Club have that boutique feel. The hotel in Dorado Beach is a Ritz-Carlton, but it’s a Ritz-Carlton Reserve. There’s no comparison to your typical Ritz-Carlton.
Kimberly Wilson Wetty, Valerie Wilson Travel: But I think that goes to your question as to what are suppliers doing to adapt? At this point, certain suppliers are changing to adapt to some of the trends. It’s interesting for those who say they want more of a boutique experience but they will also often say that “I want the Four Seasons service.” And they’re still using the launch of the Four Seasons as a benchmark from a perception of service.
Top Executives Taking the Pulse of 2018: Michael Holz of SmartFlyer and Jack Ezon of Ovation Vacations.
Ruthanne Terrero: Let’s talk about Airbnb. Are your clients coming to you looking for home stays or wanting to rent a house?
Jack Ezon, Ovation Vacations: The general manager at one of the most prestigious hotels in Beverly Hills shared [with me] that he’s losing his top suites business to mansions that are listed with Airbnb. That has a huge impact. And now with Airbnb Plus, homes are going to be vetted. That takes us to another level. Then there’s Airbnb Tours and Airbnb Luxe. Whoever thinks it’s not infringing on our space is sleeping.
Michael Holtz, SmartFlyer: Let’s just keep in mind that Airbnb is a platform. It’s not a product. A lot of the products that are on that platform are also on other platforms.
I think the whole Airbnb thing is going to wipe out a whole level of “travel professional.” I actually think that’s a good thing, not a bad thing.
Anyone who thinks that a client who asks about Airbnb is not a client, in my opinion, is a fool. Anyone who is spending $5,000 a night is a legitimate client.
What I tell my agents, is you can’t blame the client if you can’t give them what they want. It’s not the client’s fault. It’s your fault. You’ve got to figure out how to give them what they want. I don’t have all the answers, but I think there are a lot of legitimate clients out there.
Kimberly Wilson Wetty, Valerie Wilson Travel: Any person, I think, is a potential client. You have to do a little vetting to decide if that’s the right client for you and what your services are.
I’m a little frightened by what communication will look like in 20 years when I look at some of these Millennials in the market place in particular. The art of communication, being able to articulate and have the confidence to verbalize and not just do it on a phone or in an e-mail is really something that we’re all going to have to be very mindful of in training.
Michael Holtz, SmartFlyer: I disagree. Some of our Millennials are the top producers in the company; they’re pulling business from other agencies on a regular basis and they’re doing it really well. I have an amazing agent who’s 26 years old and I showed her an article in the Wall Street Journal. She threw it in the garbage and said, “I just watch my news on Snapchat. I can pull it up on there.”
I don’t know how to pull up a Wall Street Journal on Snapchat but I guess she does.
Jack Ezon, Ovation Vacations: Kimberly’s right. I see that this generation has such a craving for finding community because it’s so digital and impersonal. Whether it’s at these big events, like Coachella or Burning Man, or these little groups that they’re trying to form in all of these other communities. These gatherings are a growing trend, as is Group Chat, because people are dying to connect. It’s old-fashioned human connection and they’re losing that art. It’s good and it’s bad but it’s also going to change the way people consume travel.
Kimberly Wilson Wetty, Valerie Wilson Travel: We did a training session with some of our younger team and said that if you’re on a fam trip, the expectation is when you’re at the dinner table with suppliers you don’t look down at your phone under the table, texting. You are the guest of the supplier and you’re learning about their product and their destination, so show the respect for the person who’s hosting you.
Ruthanne Terrero: Let’s turn to suppliers; are they keeping up with your clients’ needs?
Kimberly Wilson Wetty, Valerie Wilson Travel: I think we always try and wish that they would do a little more. At the end of the day, we’re all trying to figure out how to manage the changes, the volume, the client needs, the trends. Certain DMCs and hotels are creating those more local experiences. But then, are they communicating that with us? Are they allowing us to buy that? How are we supposed to market it? Are they giving us the right tools?
But then there’s so much information for advisors to stay on top of, it’s next to impossible for any advisor to be in the know. When it comes to supplier visits, we might fault them that we want them to do it more but then we kind of cut them off by saying don’t want to blast e-mails to everybody. We don’t want you to come spend too much time in the office. It’s a catch-22. It’s hard out there.
Fernando Gonzalez, First in Service Travel: I agree. It comes back to the consortia and more and more consolidation. A lot of the DMCs we’ve become accustomed to utilizing are bigger and more structured and more funded so there’s a lot process. There are set itineraries.
We have an agent who just came back from Italy and found this man who had grown up in Piedmont and he was tired of his previous career and now he’s doing amazing tours there. He doesn’t even understand the concept of a DMC. He happened to be in New York, on vacation and met with us. There’s more and more of these types of specialists.
We’re trying to develop a way to incentivize our agents to find these local experiences and bring them back to us.
Jack Bloch, JB’s World Travel Consultants: That’s true. There are DMCs that cover big general areas like South America. Then you have ones that just do Patagonia, just do a certain area of Chile. Those are the ones that you have to identify.
The Power of Communicating: Kimberly Wilson Wetty stressed the importance of communication with travel advisors who are located remotely. Left to right: Michael Holz, Jack Ezon and Fernando Gonzalez.
Ruthanne Terrero: Jack, let me put you on the spot because you’re independent and so in that sense you are unique.
How do you work finding people in far-away places that you can trust? Because your clients are very high end and they’re looking for a very wonderful experience.
Jack Bloch, JB’s World Travel Consultants: It’s all about getting feedback from the different places they are going to. It depends on finding those people, as Fernando says. Just recently, we found a great guy that only does Patagonia. They don’t touch any other parts of South America so they know the ins and out of things that the other DMCs won’t be able to do.
You’re also always reading, and it’s about having relationships with people, people telling you what they’ve done. It takes a lot of time and learning. It’s a 24-hour thing.
It’s hard. When someone asks for a certain destination, you start doing a little more research and you’ll find that specialist that only does that place, like just Amalfi, just Venice or just Verona. The ones that do the whole region, you need to start questioning. How can they do a whole region well?
Kimberly Wilson Wetty, Valerie Wilson Travel: Another trend that we are seeing is the switch between human connection and technology. Suppliers are really trying to figure out what’s that right balance between all the technology versus the human connection. An interesting concept that’s out there is getting rid of check-in and how you order food. Are you being brought to your room any more? What’s your guest experience? What’s the balance between that use of technology, which is so powerful in terms of knowing what your preferences are, versus actually connecting with a human being? Many suppliers, hotels and cruise lines are struggling and trying to figure out what the balance is.
Joshua Bush, Avenue Two Travel: The batting average with technology is higher than with a human being. What I mean by that is that you have a chance of more things going wrong with a human, or more things going right with a human if it’s the right way in which you’re greeted. The feeling is there. The connection is there.
I think that training a staff that can tell a story and make that client feel very special is getting harder. It’s a lot easier for a supplier or hotel just to say, “Okay, well there’s this trend for more people to go the technology route. I know that I can track it and the delivery of it is going to be that much more uniform than if it were with a human being.”
What’s surprising is those hotels that are bucking the trend of technology, doubling down on the human element and making sure that that’s going to be an out-of-this-world experience as opposed to consistent delivery just through the technology.
Assessing the Future: Joshua Bush of Avenue Two Travel, right, says his agency helps plan client travel for the long-term. Left to right: Fernando Gonzalez, Kimberly Wilson Wetty and Matt Turner of Luxury Travel Advisor.
Ruthanne Terrero: Let’s talk about suppliers visiting your offices. Is there something you wish suppliers would do when they request to spend time with you or your advisors?
Michael Holtz, SmartFlyer: We don’t accept bagels, cookies, doughnuts or anything else like that. We tell them to donate money to the Food Bank for New York City. That’s number one. We move them in, we move them out quickly. Some do a presentation, some don’t. There’s no hard and fast rule. It depends.
Fernando Gonzalez, First in Service Travel: We’ve been with Virtuoso three years now. Year One that we joined Virtuoso, being in New York City, the floodgates opened. I got four or five or six times more supplier visit requests than we typically did and it became a big problem because we were getting a lot of bad feedback through hearsay, with suppliers saying, “I didn’t see him, him, him, or her. I invested in bringing bagels and champagne and where’s my ROI?”
I try to be courteous [with visits] once or twice a day but not six or seven times a day. Not when some of these guys are in here staring me down and I feel guilty if I don’t talk to them. It got so out of control and was such a problem that for eight months, we didn’t take any visits and we started trying to figure out what to do. We came up with several policies.
One of the things that has been most successful, is what we call “First Partner Memorandum” to understand what the goals of what our preferred partners are and for them to understand our goals. As part of that plan, we are very transparent in who our 100 agents are, which ones do corporate, which ones do entertainment, and which ones do leisure and what their names are. This was agreed upon with the agents, at the risk of the agency and the ownership losing some control. It has been the most efficient way to really match and pair. If we get a visit, we agree to a brief visit and a very concise visit. No PowerPoint presentations. We know that if there are four people there, those four people are selling London, they’re selling five-star properties, or they have big groups. It’s a much more effective connection versus pulling in 20 agents that are irrelevant.
We also vet every single supplier that wants to come in. We’re realizing that more than 80 percent of them we’ll never do business with. It’s about really qualifying because half the people just want to check off the name of an agency.
Ruthanne Terrero: They’re not even vetting you.
Fernando Gonzalez, First in Service Travel: They’re not. They just want to go through five or six agencies in New York and it might not even be productive for them.
Jack Ezon, Ovation Vacations: We have focus groups; it’s a conversation, not a pitch. A lot of suppliers send questions to some key advisors in advance. People put it on their calendar as an appointment, they commit to it and actually sit there and have a conversation. That’s been very successful. You can’t have that three times a week. It’s got to be twice a month.
Number two is when certain suppliers come in, they don’t know how to sell. Sales people who don’t know how to sell even though it’s a B-to-B conversation. But people don’t understand how to position their hotel, when to tell people that light bulbs should go off. That’s the biggest problem.
Kimberly Wilson Wetty, Valerie Wilson Travel: We make sure they do destination presentations. Our advisors are getting tired of just product only. So we’ll bring in a group of suppliers once a month to talk about destinations and then each supplier can plug and play where their product fits into it.
We haven’t talked about the remote advisor. We touch our remote advisors. We are a global agency. We’ve kept in touch with them around the world, but it’s not [an issue] that we have completely solved. Everybody hates webinars.
We’ve encouraged [supplier sales reps] to go to them. Just because you’re making a sales call doesn’t mean you have to go to Manhattan. Maybe you should go out to Long Island and see that advisor where they don’t come into New York.
It’s about understanding your list of advisors and I think it’s our responsibility to do a better job of communicating with that supplier, if that’s a supplier we really want to do business with. And, if you’re really not interested in trying to grow your business with that supplier, it’s okay to say that.
Michael Holtz, SmartFlyer: Some have reported us to Virtuoso because we won’t let them in. You can go and report us and do whatever you want. It’s not really making a difference.
I truly believe that just because you’re in a consortia, we don’t owe it to you to let you in the door.
Many of our best suppliers are not Virtuoso. The reason why they do a great job is because they’re not bogged down with Tilly Silverstone from Indianapolis, calling for a $300 shore excursion.
To your point Kimberly, some of the best relationships that our advisors have are the ones in secondary markets, where a supplier took the time to fly out and meet with five of them and they become a loyal advocate for that supplier for life.
Great Start: Fernando Gonzalez of First in Service and Kimberly Wilson Wetty of VWT concurred that 2018 has started off strong for leisure and business travel.
Jack Ezon, Ovation Vacations: We also have to be very cognizant of that it’s a two-way relationship and that our piece of the pie is not necessarily growing and it’s the most high-maintenance, high-cost piece of the revenue machine for a supplier. We need to be cognizant as partners. We need to make it easy to work with us.
There are all these new online distribution channels. They’re thinking about this. Some are cutting in commissions for no reason. We’re the most expensive, the most-high maintenance, and the rate of the return on that investment is not growing. We’re still significant. We have a great ADR. However, we need to be very cautious and thoughtful in our relationships and value them and to make them feel valued. It’s a two-way street and we need to be very careful.
Joshua Bush, Avenue Two Travel: I think that the message if we can communicate with the suppliers would be ... to partner with those that want to partner with you. One, a sales company is not an entitlement. It’s something where you need to invest in my company and I want to make sure that I want to invest in you.
To Jack’s point of view about those that are coming in, we get that and we feel that way. However, there are a lot of people that are just knocking on the door and wasting everybody’s time. It’s not fruitful for them because if anything, they’re going to leave a bad taste in our team’s mouth so that we wouldn’t want to book them anyway. You’re almost better off not coming in.
Michael Holtz, SmartFlyer: The truth is, that someone who may be a great fit for you, may be a bad fit for Fernando and vice versa. That’s what I tell these people. As you said, some agencies need more hand-holding, some need less hand-holding, some want transparency, some don’t want transparency.
Joshua Bush, Avenue Two Travel: There’s certainly enough to go around for all of us.