Now is the Time to Travel? - Believe Nothing

May 21, 2008 George's Observations No Comments


The travel industry has taken a queue from the real estate agents modifying their "Now is the time to buy" mantra to "Now is the time to travel."

Earlier today I read where CSAA forecasts that Americans traveling internationally will increase by 2.6 percent this summer over last. Really? In the face of an economic recession, sky high inflation, job losses, higher airfares, less airline seats, a miserable flying experience and a U.S. Dollar that is trading at all-time lows against foreign currencies.
I smell a PR spin!

This just in from CBS MarketWatch today 5/21/2008:  "Fed Says Inflation Soars!" Wow. Really? What brilliant insight. They have been using the  "R " word and basically putting a spin on all things economic for quite a while. Have these people bought a gallon of gas or a loaf of bread lately? Do they just have "their people" shop for them? I guess they just ran of room to manipulate the numbers any further.

But, I digress: Speaking of putting a spin on numbers. I have been reading in disbelief this travel hype in the trade journals for weeks. Yes, Americans need a break from their hectic pace, but timing is everything. We all seem to move in droves. I would always wonder why business was either feast of famine. Why did the phone calls stop and then suddenly go crazy? Seems they are pretty quiet lately. I have seem web traffic for travel keyword phrases decline quite a bit. Travel agencies are laying people off, Orbitz posted a multi-million dollar loss. Other online travel companies are considering moving toward more advertising to make up revenue losses from reduced bookings. So I ask :Who cooks up these numbers?

What planet are they on or is now just the time to travel?

George

Back to the Future; History Repeats Itself

May 5, 2008 George's Observations No Comments


Yes, History Has Repeated Itself Once Again.

I was having a conversation with a friend the other day about the high price of gas. I reminisced how I used to make money waiting in the gas lines for people. The year was 1973. The price of gas roughly doubled going from about 30 cents a gallon to about 60 cents. As the conversation progressed, I remembered how inflation had skyrocketed as well. We were at the tail end of an unpopular war which ended in April of 1975. We woke up to the fact that our American made Cars were not as good as the Japanese imports. Stagflation was the evil word of the day. Inflation had taken hold big time pushing prices higher stifling economic growth. This was primarily due to the Fed turning on the printing press making money to pay for the war. Paul Volcker, the Federal Reserve Chairman at the time raised interest rates to 17 percent because of the inflation. The economy choked, coming to an abrupt stop. Prices began deflating including housing because no one could afford the payments at the super-high interest rates.

It suddenly occurred to me, history has repeated itself once again. Who was it that said those who ignore history are doomed to repeat it?

Today, we are right back in 1973. We are toward the latter stages of an unpopular and costly war. Gas prices are at record levels. The cost of everything, especially food is skyrocketing. Heck a loaf of bread here in California is over $4! It seems like everything is now made in China. America now makes nothing. Housing prices are falling at the same unbelievable pace they went up. The Dollar is dropping like a rock against world currencies. And you can bet that soon the Fed will be forced to increase interest rates to record levels to combat inflation. I sure as heck wouldn’t sign up for an adjustable rate mortgage right now!

Yet, you just wonder how stupid the politicians think we are. They beat around the bush with their assessments. They use descriptions like "cost-push inflation" instead of the much more accurate term Stagflation. They say "the R word" in place of the politically un-correct term Recession. They want to give us $600 or so to get us back on track. Why? All we’re going to do is give the money to China to buy all their cheap-ass "just-good-enough" import goods. Sad but true. But the 80’s turned out ok. And the 90’s were even better. So maybe it will all be worth it.

Indeed, we are back to the future. History has repeated itself.

My Two Cents,
George

A Return of the Vacation Charter Air & Hotel Packages!

April 26, 2008 George's Observations No Comments


You heard it here first. Watch for the return of the vacation charter business.Vacation packages that use air charters as a component will make a stunning return in 2009. With the demise of Aloha and ATA airlines, Hawaii will be the first market that has various air charters flying happy vacationers to their beautiful islands.The major airlines are reeling, unsure of how to make money and mismanaged enough to alienate just about everyone in the process. They know then need to charge higher airfares to make operating profit and they also know that if the fares get too high in vacation markets, the traveling public will make other choices to use their discretionary income. This opens the door for larger tour packagers to offer air charters to keep the fares down and travel up to high volume destinations.Smart vacation charter operators will want to utilize a network of outlets that do not cost them anything until a sale if made. They do not have to make their products a commodity on the electronic merchatile exchanges known as Expedia and Orbitz. These smart tour companies will seek out the travel agents of the nation to distribute and offer their vacation packages.

George

Where are the Young Travel Agents ?

April 20, 2008 George's Observations No Comments

I read with great interest the article in Travel Age West by J.L. Erickson (4/14/08) about the lack of new blood in the travel agent industry. As a former agency owner for many years, I can tell you that this is no secret. There is indeed a critical shortage of "quality" entrants into the travel business. Finding, developing and retaining GenX agents is next to impossible. If this does not change, the travel agent industry is doomed.

I propose that travel agencies provide a front-line agent Career Track to attract new people.

Obviously, the Internet has been the driving force behind the perception that travel agencies days are numbered. However, the fact that travel agencies are still around and thriving despite new competition, puts this argument to rest.

A greater argument is that travel agencies have not provided a "Career Track" for agents. Once an agent, always just an agent? Doesn’t sound like much of a career choice if you are young person deciding your future. Does it? Agency owners have simply not provided an opportunity for front-line agents to take their career to a higher level. If the travel industry provided a Career Track with goals to strive for, along with the accompanied peer status…..then becoming a travel specialist would once again be an enticing career.

Employees need goals and opportunity to work toward. Failure to provide this means you are looking for a people who does not possess the inner drive that makes a sales person thrive. A career track would provide the incentive for agents to seek out additional education and marketing opportunities for their chosen destination or travel niche. The reward will be higher income as they develop a larger, higher quality clientele. They will also be able to charge higher fees as a result of being a leading expert in a particular destination or style of travel. The agency will benefit as a result of being able to brand market their “Stars” individually helping establish the agency as an organization committed to quality and can be trusted for expert advice.

I propose the creation of three categories of front-line agent designations:

1) Travel Consultant
This is the starting point. Less than 3 years experience. Limited to selling commodity type travel packages and cruises.

2) Destination Specialist / Cruise Specialist
Minimum of 3 years experience and has completed CTC or Destination Specialist training. Has traveled to their specialist destination at least three times.

3) Custom Travel Designer - Minimum of 5 years as a specialist for travel to a specific destination or style of travel. Has completed CTC and DS program and has traveled numerous times to the destination or style of travel.

Once agents achieve a higher status they will possess a superior career self-image and confidence that will help them develop higher level clientele. They will also be more comfortable charging considerably higher consulting fees and more importantly the clients will feel better about paying it.

I believe that providing a career track for frontline agents would entice more young people to view the travel agent industry as a viable long-term choice. Additionally, existing agents would once again be energized and excited about the industry. Most importantly would be the marketing opportunities that would result. Consider for a moment if your organization provided a "Career Track" for your top performing individuals. What would change? Probably your working environment would become even more professional and your bottom line would increase as a result.

George Oberle
President
www.ReviewResorts.com

Times are Tough ! - Will Luxury Hotels Survive?

April 9, 2008 George's Observations No Comments

For the last 5 or 10 years, the emphasis in developing travel has been on the upscale or luxury market. 97% of the new hotels developed have been in the upper end of the quality and rate range. But times have gotten tough. For most of us in the US, our asset base is shrinking with the deflating housing market, $4 a gallon gasoline and the accompanying inflation.

So I have a question: Now that times are tough who is going to fill all these expensive rooms? It’s common knowledge that upscale resorts rely heavily on the middle class living large on vacation. Will the middle class traveler still spend the big bucks, or will they search for value?

The prevailing thought is that the rich will still travel. But do they travel enough to fill the excess capacity? My guess is that the middle class will still travel, yet will only respond to value. Economics 101 tells us that in recessionary times, people move toward inferior goods in search of capital preservation. Translated to the travel industry, consumers will not respond to high airfare or hotel rates. They will search for the absolute best deal or value. It may be freebies like extra nights, meal or bar credits, it may also be lower rates, but the message is that travel suppliers will be offering something to entice travelers to part with some of their shrinking assets. It’s going to be tough.

George

What Makes Cents?

April 1, 2008 George's Observations No Comments

First Aloha Airlines (1,900 employees) and now two days later, the announcement that Champion Air Charter (550 employees) are both ceasing operations. The graveyard of travel companies is sure to increase substantially in the near future.

A harsh assessment of the travel industry indeed. But consider that cost-push inflation and the accompanying recession are combining to make the term "stagflation" once again a relevant description of the US economy.

Stagflation is the worst of all evils for the travel business. The profit margins are razor thin in every sector of the travel industry. The Internet has stripped all excess profits in the process of making travel products commodities. Orbitz, Kayak, Expedia and the rest are all nothing but electronic commodity exchanges where there is only one way to get the top listing is to have the lowest price. Good for the consumer, bad for stability of the industry.

The combination of increasing costs and reduced demand are forcing businesses to make tough decisions. What makes "cents" providing a service with a certain cost structure, now provides substantial losses with the effects of Stagflation.

Unfortunately, stagflation will cause many more travel companies to disappear along with the jobs they create.

George

Does Sex Sell ? - Here’s Proof….

March 21, 2008 George's Observations No Comments

We recently received word that the Blue Bay Getaway Hotel in Cancun changed its name to the Temptation Resort. The Blue Bay has always been an adults only concept. But the action has mostly been limited to some topless sunbathing and risque pool games. The name change to Temptation coincides with the volume being turned up a bit on the risque aspect of things shall we say.

Interesting is that the web traffic for Temptation Resort on www.ReviewResorts.com has increased substantially. Additionally, the number of keyword phrases people used to search for web pages with information on the hotel increased as well too. “Temptation Island” and “Temptation Resort” are a couple of the more popular searches. In fact, this resort page is one of our top viewed on the site right behind Hidden Beach Cancun Clothing Optional Resort.

So does sex sell ? You bet it does!

George

Time-Share Sales Pitches / Greed Meets Greed!

March 9, 2008 George's Observations No Comments

I get at least two or three resort reviews a week complaining about high-pressure sales presentations for time-shares. I know that time-shares are extremely profitable for the hotels and little Timmy needs new Nike’s, but the degree of the bad impression they seem to ignore is remarkable. Read this review and let me know if you think the people will return:

"We went on the (time-share) tour . We were there for 3 hours. We were told there was NO pressure but that was not true at all. We had 2 pressuring us. Then we were promised things for going on the tour and were not given them when we went back up to the office. We were given the run around for 2 days and then told we could not have them. And almost was not given our $20.00 deposit back there. This has left a very bad taste in our minds."

But the people attending are promised tours, credits and other free things. Are they just as greedy as the sales people? This review clearly illustrates the type of run-around and pressure people get for thinking they are getting something for nothing.

My question to both: Is it really worth it?

Tom Bodett of Motel 6 was right !

March 4, 2008 George's Observations No Comments


I once heard a radio commercial by Tom Bodett hyping the Motel 6 web site. He made a statement to the effect that “the next time you are playing on the Internet; I mean the next time you are at work.”

I was reminded of this commercial while reviewing site stats at my www.ReviewResorts.com hotel review site. I noticed that 95% of the resort reviews we receive are during the work week. We rarely receive hotel reviews on weekends. Sometimes on Saturday nights (aahh…those poor lonely folks).

Interesting tidbit don’t you think?
This great library of information known as the Internet has exponentially increased productivity. However has it also increased playing around at work? Maybe the work environment is now so intense that people need an occasional diversion to recharge and get back at it?

Just my two cents while playing around at work.

George

Vacation in Canada ? - Not if you have a DUI

February 26, 2008 George's Observations No Comments

You can run, but you can’t hide ! If you didn’t have a better reason to live a clean life, you may be stuck in your home country because other foreign countries don’t want you corrupting their fine citizens.

Canada for example has set the bar high for what it considers an “undesirable.” According to a briefing by Canadian Customs & Immigration, they will not allow people who have been convicted of DUI entry into Canada. In Canada, a DUI is a felony offense which they take as a very serious infraction. Canada does not allow convicted felons entry into their country whether the conviction was in Canada or the U.S. Additionally, any U.S. conviction of a misdemeanor offense including reckless driving, domestic violence, shoplifting or drug possession just to name a few, can also be grounds to be turned away from entering Canada.

Reminds me of stories from Singapore where chewing gum could land a punishment of lashing. Since 9/11, the world has been inherited by the crazies. This is another extreme reaction. Hopefully, we are headed for more moderate times where reason and common sense prevail over crazy extremism.

George

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