TA Rebates

[Keith1010]

No, I have not yet sailed on Regent. I actually did have a Regent cruise booked and due to a change that the cruise line made we cancelled it so I am very familiar with the rebates that were offered with Regent as they were part of our booking and they were were consistent with rebates of other luxury lines I sail. What I find differs are rebates that are provided on many of the lines that are not luxury because of their commission structures.

 

The agency/agent I use books heavily with all of the luxury lines, including Regent.

 

My comments that a good travel agent is worth their weight in gold is my opinion and I really don't care if someone thinks they are subjective or objective. It is based on my experience of dealing with average agents/agencies as well as dealing with some outstanding ones and it is based on booking around 60 cruises.

 

The issue of rebating and good and bad agents crosses all of the luxury lines. This is not specific to Regent at all.

 

My view of travel specialists is no different than my view of most professions. In fact, realtors are a perfect example because some people think that they do nothing too. There are outstanding realtors who too are worth their weight in gold and in good and bad times can get your house sold or lead you to the right house to purchase. And there are bad agents who are worthless. Same goes for just about any profession I can think of.

 

Keith

[A Tucson Guy]

Wow! This thread is very entertaining and good points are being mentioned. It also looks like some people have their underwear twisted in knots and that has to be uncomfortable. Take a breath, untwist your underwear and relax. As the late, great Michael Jackson sang a long time ago, "ya gotta leave that 9 to 5 life on the shelf, and just enjoy yourself." I'll bet the Mods delete this but that is OK. I am still enjoying this thread.

[newlondon]

Roland, Your point about everything else is well said. I, however, send my TA a check of $500 for each trip she completes because I think it is extra and is not part of the cruise experience. As an example on a Uniworld trip we are taking a full day private excursion to Les Baux. She has arranged the car researched the luncheon reservation plus our sightseeing. In SE Asia she will arrange private tours in Sydney, Halong Bay, Bangkok, and HK. Since I am demanding I feel extra compensation is appropriate.:)

[newlondon]

I did leave out, however, she has never discussed rebates which does bother me if it is standard industry practice.

[Travelcat2]

The issue of rebating and good and bad agents crosses all of the luxury lines. This is not specific to Regent at all.

 

 

Keith

 

I certainly agree that there are good and bad agents. IMO, due to the ultra-inclusiveness of Regent, the passenger requirements from a TA are a little different. These changes have happened within the past two years (approximately -- do not remember exact dates that included hotels and excursions were implemented) so, things are not the way they were prior to that.

 

Since Regent customers can book their cruise online (and have it transferred to their TA), have airfare included (or can deviate using Regent's Air Dept.), have their hotel and excursions provided, this is less work for the TA. If they feel they can rebate up to 5% (Regent's new policy I believe), it is up to them. More important than the rebate is the fact that there is a team of highly qualified individuals who are behind their customers and insure they are taken care of.

 

Note: I am not implying that TA's who book Regent do nothing. I cannot imagine the time it takes to check price changes on each and every cruise and category whenever Regent has a "special" or does their quarterly increases on some itineraries. They also insure that every little detail on our booking is correct and that that we are promptly informed of changes.

[galavant3]

I did leave out, however, she has never discussed rebates which does bother me if it is standard industry practice.

 

Yeah, that's kind of my feeling. It was on our first Regent cruise that we learned about the rebates/credits extended by other agents. We did change to an agency that openly advertises what they offer. And I promptly requested a Platinum Amex.

[Seabourntraveller]

Yeah, that's kind of my feeling. It was on our first Regent cruise that we learned about the rebates/credits extended by other agents. We did change to an agency that openly advertises what they offer. And I promptly requested a Platinum Amex.

 

Precisely my point. I have come across so many people on thesse boards that have no idea about OBC's, rebates etc. and why? because the agents they deal with refuse to be straight forward and honest and share those amenities.

[Roland4]

I did leave out, however, she has never discussed rebates which does bother me if it is standard industry practice.

 

Actually it is not a standard industry practice, and there is certainly no requirement to do it, but it is something that some agencies will do. The point I was trying to make in my first post was that it is a practice that has been banned by Carnival, and since Carnival owns Seabourn, and when one does it they may all do it, it is a practice that may (Seabourntraveller's insistence otherwise acknowledged) also happen in the luxe end of the market.

 

Seabourntraveller, I am going to preface this next paragraph by saying I do not want to rehash the previous posts. We are both entitled to our opinions. and mine is as valid as yours.

 

Interestingly, on the topic of rebates, I was reading in a trade publication earlier today an interview with the CEO of one of the largest cruise travel agencies in the world. In the interview he went on record strongly advocating that ALL cruise lines follow Carnival's lead and ban rebating. His reasoning? He is tired of his people doing all of the leg work and then having some other agency "buy" the business out from under them with a rebate that often amounts to 100% of the commission. This is exactly the reason Carnival has banned the practice. This is a worldwide company that does 7+ figures in cruise business every year. Something tells me the management of the various cruiselines might just give him a hearing.

[Roland4]

Roland, Your point about everything else is well said. I, however, send my TA a check of $500 for each trip she completes because I think it is extra and is not part of the cruise experience. As an example on a Uniworld trip we are taking a full day private excursion to Les Baux. She has arranged the car researched the luncheon reservation plus our sightseeing. In SE Asia she will arrange private tours in Sydney, Halong Bay, Bangkok, and HK. Since I am demanding I feel extra compensation is appropriate.:)

 

You have a very fortunate TA and you are very generous. In my experience, most TAs are quite happy to have a demanding client because while they may be demanding, they are usually quite reasonable in their approach to things and don't ask for things they know can't be done.

[Travelcat2]

Seabourntraveller, I am going to preface this next paragraph by saying I do not want to rehash the previous posts. We are both entitled to our opinions. and mine is as valid as yours.

 

Interestingly, on the topic of rebates, I was reading in a trade publication earlier today an interview with the CEO of one of the largest cruise travel agencies in the world. In the interview he went on record strongly advocating that ALL cruise lines follow Carnival's lead and ban rebating. His reasoning? He is tired of his people doing all of the leg work and then having some other agency "buy" the business out from under them with a rebate that often amounts to 100% of the commission. This is exactly the reason Carnival has banned the practice. This is a worldwide company that does 7+ figures in cruise business every year. Something tells me the management of the various cruiselines might just give him a hearing.

 

Sometimes it is a good thing to "rehash the previous posts". Also, IMO, what the "largest cruise travel agencies in the world" and one (if not the biggest) cruise line in the world does does not necessarily mean that all cruise lines in the world should follow suit. What will happen will happen. How much of what is being posted on this thread is for the benefit of the cruise industry and their passengers and how much of this is simply defending the position of of TA's who do not rebate?

[Roland4]

Sometimes it is a good thing to "rehash the previous posts". Also, IMO, what the "largest cruise travel agencies in the world" and one (if not the biggest) cruise line in the world does does not necessarily mean that all cruise lines in the world should follow suit. What will happen will happen. How much of what is being posted on this thread is for the benefit of the cruise industry and their passengers and how much of this is simply defending the position of of TA's who do not rebate?

 

The intent of my "rehash" comment was simply to extend an "olive branch" and avoid repeating the argument. Nothing more.

 

Nowhere did I suggest it would happen, only that it might happen, something those who currently do get rebates (and perhaps depend on those rebates) should be aware of when planning future cruises. Especially those booking into 2014/2015. It could be a nasty surprise if it happens. And when "one (if not the biggest) cruise line in the world" also owns one of the luxury lines, it is probably a reasonable bet that if it happens at Seabourn, it will happen with all the others too.

 

As to who this benefits, I did say in an earlier post that those who currently get rebates will be negatively affected, no question. It will benefit some travel agencies obviously (those that currently rebate), but certainly not all agencies, especially those that do not already rebate. The bottom line is that the cruiselines are selling a product and they have the right to specify the conditions under which agents are allowed to sell said product. I have no idea how long the practice of rebating has been around, but I suspect it was never part of the cruiselines' "sales model". If the lines decide to eliminate it, that is their decision to make.

[YYC F/A]

Interesting thread.

 

A few thoughts (from a TA that's been in the business for most of the last 20 or so years...)

 

First, I'd note that the 17% agency commission figure being bandied around is the exception, not the rule, and only given to a select few accounts. Most are somewhere between 10% and 15%, and of the "most", the majority are closer to 10%.

 

Additionally, your sample $16,000 pp fare to Regent - by the time you back out a non-commissionable $4,500 business class air allowance, a non-commissionable $1,600 "free land package" allowance, a non-commissionable visa fee and other non-commissionable components - the commission that the agency gets is likely only on around $9-$10k of your fare and not the full amount - so don't think your agent is getting 17% of a $32,000 booking. They're not.

 

Second, Regent (and Oceania) recently updated and tightened their rebate policy. Giving 10% cash rebates, as some posters here claim they receive on every booking, is certainly not within the spirit of the new policy. Per the updated policy, agencies are expressly forbidden from advertising rebates - period. However agencies may advertise "amenities", e.g. OBC etc. up to 5% of the base cruise fare (not including air, hotel, other add-ons). There will doubtless be some agencies that continue to compete based purely on price and rebates (perhaps because they cannot compete on service, and their overall value proposition?) but they'll need to be increasingly surreptitious about it as Regent has indicated they are committed to taking rebating issues seriously.

 

I'm not going to get into a debate (and there is a lengthy one) about why agencies should be "expected" by consumers to give back some/most/nearly all of their compensation. I find it interesting/ironic though that some of the posters here whom claim TA's are "Greedy" if they retain most of their commission are the same ones that expect a full 10% cash or check rebate from their TA, in effect leaving the agency with perhaps as little as 20% of their intended compensation from the cruise line.

 

Additionally, luxury/cruise specialist TAs are expected by the cruise lines to do a lot more than just sit back and wait for the bookings to roll in all bundled up and good to go. Larger/specialist TA's are expected to conduct marketing in local markets, invest time/money/resources in existing client promotions, communications and events, and be an ambassador to the press and media in local communities. While some of those expenses may be partially shared with the cruise line, a larger/specialist TA will have some not inconsiderable expenses with perhaps even full time marketing folks on staff - in effect almost an extension of the cruise lines own sales and marketing team at HQ. This is a side of the business that many consumers don't see or consider, but is a major time and cost investment nonetheless by the larger/key specialist agencies.

 

For what it's worth, and from my own personal perspective (and I speak strictly for myself and certainly not for all TAs), I believe that on higher end luxury bookings with large commissions, there is merit to offering onboard credits and other value-adds/amenities to thank our clients. However, I think that the 5% of base cruise fare which is the figure Regent uses in their policy - and which in essence represents about 1/3 to 1/2 of an agents commission depending on their commission tier with Regent - this is a fair and balanced figure to use. Certainly, I don't think that good, professional, full service agents whom can provide a robust range of services should feel pressured into "giving back" more than around 35% of their income/compensation to their clients just because there are some internet agencies whom offer a lower threshold of services, whom work in bulk/volume rather than personal relationships, and therefore "give back" up to 75% of their income.

 

There are luxury agencies out there whom can bring a lot to the table. Expertise. Experience. Personal recommendations. Even experienced cruisers can benefit from a "good" luxury agent whom can help pull a favour here or there for an oversold cabin category, or whom can secure a complimentary room upgrade at a luxury hotel... whom can put together a private day of touring with a fantastic local vendor, or a special private wine tasting... Not too mention service resolution, after hours enroute assistance etc. I'd like to think that a good agency that can offer these services, along with competitive client amenities of around 5% of the base cruise fare... these are agencies that offer a good balance. Frankly, I know our office couldn't sustain rebating 10% and still provide that level of personalised assistance, and our business model just simply isn't one where we hire minimum wage folks with no real experience (or interest) just so we can achieve that level of rebating. But your luck may vary.

 

Finally, it's been posted in it's entirety on this board in another thread, but I think these paragraph's from Regent's recently updated rebating policy accurately sum up the situation from both Regent's perpsective, as well as most TA's perspective.

 

 

"From our perspective, rebating creates confusion in the marketplace as it results in lower margins for agents and leads to a wide spectrum of prices and value-adds being offered for the same stateroom. Consequently, consumers are uncertain as to what they should expect to pay for a cruise and travel agents are uncertain as to what price to quote them. The result: confusion among consumers, frustration among travel agents and cruise lines wishing that their most important partners were focused on articulating the brand and value proposition of their respective lines rather than discounting product."

 

"An upscale cruise vacation is a product that is sold, not bought. Our value propositions needs to be understood, not discounted. And more important than at the larger cruise lines, our success is very dependent on the travel agent’s ability to learn and understand the wants and needs of cruise prospects, to know and be able to articulate the points of distinction, to match the prospect with the right cruise and ultimately, to close and service the customer over the many months from booking to sailing and start the cycle again when they return home."

[YYC F/A]

Precisely my point. I have come across so many people on thesse boards that have no idea about OBC's, rebates etc. and why? because the agents they deal with refuse to be straight forward and honest and share those amenities.

 

I think this comment is a bit harsh.

 

Agency commissions are not intended, ultimately, to be returned to the client. There are many agencies however whom elect to "thank" their customers with the purchase of an amenity - and there are a number of agencies whom use "rebating" as their marketing tool to solicit business.

 

But to imply that agencies that elect not to give back their compensation which, ultimately, is their own and was not intended to go back to the client - to say that agencies that elect not to rebate are less than honest - with respect, I think you are being disingenuous.

 

And FWIW, the company I work for does offer "thank you" amenities to our clients.

[fluckey]

I think it is great that travel agents are forced to compete in the marketplace. Some may want to compete with better services and some better prices (i.e. rebates). Customers can make their choices, those that don't need hand holding can go for the 10-12% discounts. Others may want to pay more (sometimes thousands of dollars) for the services the agent can provide. No different than buying Scotch tape or Band-aids at Wal-Mart versus the old corner drug store (except the dollars are a lot bigger). And thank goodness we have the internet so more light can be shed in the area and we can make more informed choices. Travel agents that offer neither better prices nor better services will have a hard time getting business, as it should be. I'm 100% with the previous post by Col. Wes, it is a real shame that some customers didn't know that options were available. Threads like this are great for educating customers. No reason that an agent should make thousands of dollars booking a cruise unless unless the customer is happy to pay for the service.

[WesW]

+1 (strongly agree) fluckey

[rlimbacher]

WOW! I would never ask my realtor for a rebate in order to lower the price of a property. I would also never ask my wonderful travel agent to rebate the commission earned from the cruise line. Those travel agencies that give a rebate in order to gain customers are just diluting their revenue. The cruise lines have forbidden those agencies from over extending the rebate since it was not intended to discount the price of my cruise. This is Regent's policy and others as well. Regent never intended for my travel agent to discount their product with commission dollars.

[Travelcat2]

Isn't there a place where TA's can debate this? Exposing this information to passengers/clients can only cause problems (IMHO). I don't care what my TA's commission is -- they earn it. I accept whatever they offer to us in terms of rebates. This, IMO, is not a discussion that should be held with your customers.

[rlimbacher]

Again, well said travelcat2! I always enjoy reading your posts.

[seattlesloop]

I think it is great that travel agents are forced to compete in the marketplace. Some may want to compete with better services and some better prices (i.e. rebates). Customers can make their choices, those that don't need hand holding can go for the 10-12% discounts. Others may want to pay more (sometimes thousands of dollars) for the services the agent can provide. No different than buying Scotch tape or Band-aids at Wal-Mart versus the old corner drug store (except the dollars are a lot bigger). And thank goodness we have the internet so more light can be shed in the area and we can make more informed choices. Travel agents that offer neither better prices nor better services will have a hard time getting business, as it should be. I'm 100% with the previous post by Col. Wes, it is a real shame that some customers didn't know that options were available. Threads like this are great for educating customers. No reason that an agent should make thousands of dollars booking a cruise unless unless the customer is happy to pay for the service.

 

Well stated.

 

Travel agents not only earn commissions, but many travel benefits in addition to those commissions. Some have traveled the world and then some off of their client's business. My travel ageny has been candid about this with my friends who book through him as well as with me several times. I see nothing wrong with travel agents giving something back to their clients. After all, it's those clients who have "supported" the agency with monetary gains and travel benefits. I see it as "win-win."

[Travelcat2]

Again, well said travelcat2! I always enjoy reading your posts.

 

Thank you so much for your comments;)

[Seabourntraveller]

Interesting thread.

 

A few thoughts (from a TA that's been in the business for most of the last 20 or so years...)

 

First, I'd note that the 17% agency commission figure being bandied around is the exception, not the rule, and only given to a select few accounts. Most are somewhere between 10% and 15%, and of the "most", the majority are closer to 10%.

 

Additionally, your sample $16,000 pp fare to Regent - by the time you back out a non-commissionable $4,500 business class air allowance, a non-commissionable $1,600 "free land package" allowance, a non-commissionable visa fee and other non-commissionable components - the commission that the agency gets is likely only on around $9-$10k of your fare and not the full amount - so don't think your agent is getting 17% of a $32,000 booking. They're not.

 

Second, Regent (and Oceania) recently updated and tightened their rebate policy. Giving 10% cash rebates, as some posters here claim they receive on every booking, is certainly not within the spirit of the new policy. Per the updated policy, agencies are expressly forbidden from advertising rebates - period. However agencies may advertise "amenities", e.g. OBC etc. up to 5% of the base cruise fare (not including air, hotel, other add-ons). There will doubtless be some agencies that continue to compete based purely on price and rebates (perhaps because they cannot compete on service, and their overall value proposition?) but they'll need to be increasingly surreptitious about it as Regent has indicated they are committed to taking rebating issues seriously.

 

I'm not going to get into a debate (and there is a lengthy one) about why agencies should be "expected" by consumers to give back some/most/nearly all of their compensation. I find it interesting/ironic though that some of the posters here whom claim TA's are "Greedy" if they retain most of their commission are the same ones that expect a full 10% cash or check rebate from their TA, in effect leaving the agency with perhaps as little as 20% of their intended compensation from the cruise line.

 

Additionally, luxury/cruise specialist TAs are expected by the cruise lines to do a lot more than just sit back and wait for the bookings to roll in all bundled up and good to go. Larger/specialist TA's are expected to conduct marketing in local markets, invest time/money/resources in existing client promotions, communications and events, and be an ambassador to the press and media in local communities. While some of those expenses may be partially shared with the cruise line, a larger/specialist TA will have some not inconsiderable expenses with perhaps even full time marketing folks on staff - in effect almost an extension of the cruise lines own sales and marketing team at HQ. This is a side of the business that many consumers don't see or consider, but is a major time and cost investment nonetheless by the larger/key specialist agencies.

 

For what it's worth, and from my own personal perspective (and I speak strictly for myself and certainly not for all TAs), I believe that on higher end luxury bookings with large commissions, there is merit to offering onboard credits and other value-adds/amenities to thank our clients. However, I think that the 5% of base cruise fare which is the figure Regent uses in their policy - and which in essence represents about 1/3 to 1/2 of an agents commission depending on their commission tier with Regent - this is a fair and balanced figure to use. Certainly, I don't think that good, professional, full service agents whom can provide a robust range of services should feel pressured into "giving back" more than around 35% of their income/compensation to their clients just because there are some internet agencies whom offer a lower threshold of services, whom work in bulk/volume rather than personal relationships, and therefore "give back" up to 75% of their income.

 

There are luxury agencies out there whom can bring a lot to the table. Expertise. Experience. Personal recommendations. Even experienced cruisers can benefit from a "good" luxury agent whom can help pull a favour here or there for an oversold cabin category, or whom can secure a complimentary room upgrade at a luxury hotel... whom can put together a private day of touring with a fantastic local vendor, or a special private wine tasting... Not too mention service resolution, after hours enroute assistance etc. I'd like to think that a good agency that can offer these services, along with competitive client amenities of around 5% of the base cruise fare... these are agencies that offer a good balance. Frankly, I know our office couldn't sustain rebating 10% and still provide that level of personalised assistance, and our business model just simply isn't one where we hire minimum wage folks with no real experience (or interest) just so we can achieve that level of rebating. But your luck may vary.

 

Finally, it's been posted in it's entirety on this board in another thread, but I think these paragraph's from Regent's recently updated rebating policy accurately sum up the situation from both Regent's perpsective, as well as most TA's perspective.

 

 

"From our perspective, rebating creates confusion in the marketplace as it results in lower margins for agents and leads to a wide spectrum of prices and value-adds being offered for the same stateroom. Consequently, consumers are uncertain as to what they should expect to pay for a cruise and travel agents are uncertain as to what price to quote them. The result: confusion among consumers, frustration among travel agents and cruise lines wishing that their most important partners were focused on articulating the brand and value proposition of their respective lines rather than discounting product."

 

"An upscale cruise vacation is a product that is sold, not bought. Our value propositions needs to be understood, not discounted. And more important than at the larger cruise lines, our success is very dependent on the travel agent’s ability to learn and understand the wants and needs of cruise prospects, to know and be able to articulate the points of distinction, to match the prospect with the right cruise and ultimately, to close and service the customer over the many months from booking to sailing and start the cycle again when they return home."

 

Funny you make no mention of Agency Bonus overides on sales targets such as Princess, Holland America, Seabourn etc. give out for reaching certain sales thresholds which start at 25K for the Agency...shall we cut those as well or limit them?:rolleyes:

[YYC F/A]

Funny you make no mention of Agency Bonus overides on sales targets such as Princess, Holland America, Seabourn etc. give out for reaching certain sales thresholds which start at 25K for the Agency...shall we cut those as well or limit them?:rolleyes:

 

If you'd like to PM me I'd be happy to discuss offline.

 

However you are mistaken in your assertion. Overrides are the additional percentage points which make up that 15% commission instead of the "base" of 10%, or the 17% instead of the 10%. So in effect, the "override" is what gives an agency a higher commission - it's not something over and above.

 

I don't want to talk about this too much on what is a public forum, but did want to correct any mis-assumption, and again, please feel free to PM me should you wish to discuss offline further.

[YYC F/A]

Isn't there a place where TA's can debate this? Exposing this information to passengers/clients can only cause problems (IMHO). I don't care what my TA's commission is -- they earn it. I accept whatever they offer to us in terms of rebates. This, IMO, is not a discussion that should be held with your customers.

 

I guess TA's can't win. We get accused of not being "honest and straightforward" (I quote) by some posters in this thread by not discussing our commissions we receive - and the rebates/amenities we're then supposed to give - while others get frustrated that we then discuss it when challenged about it.

 

There's also lots of mis-information about the compensation agents receive posted by several passengers/clients, and I guess TA's jump into the fray to try and set the record straight before everyone starts assuming we're fleecing every client that walks our way.

 

Anyway, I am happy to talk about other elements of Regent or the Travel Business generally but I'm not going to talk about rebating or our compensation agreements with the cruise lines beyond what has already been discussed by other posters in this thread prior to my comments. But if anyone wants to PM me "offline", I have no problem being candid. To be clear though, I am absolutely not soliciting business and will not divulge my company information for whom I work.

 

 

PS - I do like your avatar photo TravelCat ;)

[fluckey]

rlimbacher and travelcat,

 

If you want to pay more for your cruise because you're getting great service from your travel agent, wonderful. I also think it's wonderful to have the option to pay less if one is not looking for the same level of service. The person who pays less may actually be surprised with great service, but probably understands that with larger rebates, the travel can't spend as much time and effort on each customer.

 

And travelcat, I am astounded by your statement that "exposing this information can only cause problems". Exposing this information may cause problems for travel agents/cruise consultants, but when is withholding information good for custmers. With this sort of information customers will come to understand there are choices and can make more informed decisions.

 

And yes, I would ask a real estate agent to trim his or her commission if it was necessary to get a deal done on terms acceptable to me. I'd also tell a car dealer that I need something better than sticker price if he wants to sell the car.

[cruiseluv]

WOW! I would never ask my realtor for a rebate in order to lower the price of a property. I would also never ask my wonderful travel agent to rebate the commission earned from the cruise line. Those travel agencies that give a rebate in order to gain customers are just diluting their revenue. The cruise lines have forbidden those agencies from over extending the rebate since it was not intended to discount the price of my cruise. This is Regent's policy and others as well. Regent never intended for my travel agent to discount their product with commission dollars.

 

With all due respect, in this economic environment if you don't negotiate with your realtor that's pretty foolish. I don't know about you, but I live in the real world of supply and demand. And in that world, if there's a better price being offered for the product I want to buy, I'll go with that price. As simple as that.

 

And with regard to your comment "the cruise lines have forbidden those agencies from over extending the rebate", boo-hoo! All the reputable agencies I know continue extending rebates, they just can't flaunt it, or advertise it. So, if you want to keep paying full price (after the 2 for 1 gimmicks of course), that's your business.