Traveltube.com Podcast: Understanding the Value of Travel Agents
Host: Mark Murphy
Hi folks, it's Mark Murphy with Traveltube.com. A quick reminder: please visit the website and sign up for our weekly newsletter. You'll get videos from great content creators, including myself—though I primarily do the podcast. You'll also see clips from our travels around the world. I've been to about 80 countries, and people often mistakenly believe I'm a travel agency owner or have worked in the industry. I've never worked in the travel industry or the travel agency channel. I've simply covered it, observed it, and run a business that addresses their information needs.
At one point, I was running the largest travel news site in the world, TravelPulse.com. I sold that along with my other brands in 2019—thank God, right before COVID hit. At the same time, I decided to start Traveltube.com to showcase and bring together the expertise of travel advisors, influencers, suppliers, and destinations from around the world, delivering it all in one place.
The reason is simple: if one travel agent is checking out a property in Cancun while another is exploring a property in Maui and another is taking a safari in Africa, we can aggregate those experiences and share those insights through podcasts or content they create. It's a win-win all around.
Content Distribution
We post clips of these hour-long podcasts everywhere—Instagram, TikTok, Facebook, you name it. The content also goes out on podcast apps, so people can consume it however they prefer. Instead of sitting at a computer as a travel advisor, you can take it on the road, listen offline, use your favorite podcast app, or download it on Spotify. It's also on YouTube, so it's literally everywhere.
Last Week's Viral Clip
What's interesting are the number of comments we get. Last week was a doozy, to be frank. We've only been operating since April, so we're still under nine months of being out there, and one of the clips we shared blew up. It was an interview I did with a travel agent in the luxury travel segment. But before I get to that, I want to talk about what a travel agency actually is.
Understanding Travel Agencies
The average DIY consumer says, "I'm doing it myself." We got a lot of those comments on a clip featuring an agent who talked about what she brings to the table—booking with her versus booking direct with a hotel or resort. Because it was a limited clip, it didn't have the full context of what she said, so I'm going to show you the full context today.
Here's a little clue for the DIY person: when you book on Expedia, Orbitz, Priceline, or Booking.com, that's a travel agency—it's called an OTA (Online Travel Agency). You're doing self-service, and they're just a transaction tool. They're not there to grease the wheels before you arrive with the GM or sales manager at the hotel. They just want the transaction. It's a great business model, but if you think you're saving money by doing it yourself, let me explain something critical.
The Best Rate Guarantee
The vast majority of hotels will give you the best price at their own website—Marriott.com or whatever the brand is. That doesn't mean other sites don't have matching prices; they do. Hotels implemented best rate guarantees so that OTAs like Expedia, which were undercutting their prices, had to stop. They've been doing this for a couple of decades now. Virtually every brand has a best rate guarantee.
One way around this is package bookings—when you bundle transfers, resort, car rental, and airline tickets together. Package pricing is typically more competitive than booking components individually, but it also makes the pricing opaque, giving them wiggle room. However, for the vast majority of people booking hotels and resorts themselves through third parties, they're not getting a better rate than they would directly from the corporate site or through a travel agency.
The Travel Agency Advantage
Here's where it gets interesting: travel agencies, depending on the quality of the product—meaning higher-end properties—get higher benefits when booked through them. Let me give you an example.
Real-World Example: The Peninsula Hotel Chicago
If I stayed at the Peninsula Hotel in Chicago for three nights at $600 per night ($1,800 total plus tax) and booked directly with the hotel, that would be my cost. However, if I booked through a travel agent affiliated with a group that had insider deals, they often have special promotions running. For instance, book two nights, get the third night free. That saves me $600, bringing the effective rate down by 33%. Now I'm getting the Peninsula for the price of the Hilton two blocks away.
But it gets better. I always book as if two people are staying in the room, even when traveling alone for business. At the Peninsula, I received a $40 credit per person for breakfast every day. I would have my first breakfast—coffee, toast with peanut butter and jelly—then hit the gym and return for my full breakfast, all covered by the credit. In some cases, I'd also get a $150 spa credit, covering about 75% of a one-hour massage.
Nobody in the public domain booking on Expedia or going directly to the hotel website gets these benefits.
Why Hotels Offer These Benefits
People ask me, "Why do high-end hotels provide extra benefits when booked through preferred travel agency partners?"
Because people who can afford $600 or more per night typically value service related to their booking. Even though we have the means to pay full price, we still want the best value for our money. Hotels realize that these customers tend to be loyal, and the overall impact—even when giving away perks—results in a better experience for the traveler and more revenue and profit for the hotel. That's why they do it.
When to Use a Travel Agent
Should you use a travel agent? I use them sometimes; other times I don't. But I'm also dialed into the industry. Even though I'm not a travel agent, when I use my Platinum Card, I'm booking with an American Express travel agent who gets me the Fine Hotels and Resorts program with many of those benefits. I used to have a Black Card but couldn't justify the annual fee after selling my company, so I downgraded to Platinum. Shout out to Morgan Stanley—I don't pay the $900 fee because I get a rebate, so it costs me nothing and I get all the benefits.
Even if you do pay the $900 annual fee, there's about $2,500 in value you get from that credit card. By the way, when you book through the Fine Hotels and Resorts program using your Platinum Card, you're booking with a travel agent, even though you think you're doing it yourself. There's a huge disconnect.
When You Need vs. Don't Need a Travel Agent
I believe that depending on the product you're booking, the value proposition changes. If you're flying from Atlanta to Nashville on Southwest and spending two nights at the Hilton to go bar hopping, easily do that yourself. No one's saying you can't. Would a travel agent handle that for you? Absolutely. Could they set up dinner reservations? Sure. Some agents are really good; some are not.
I had someone complaining on TikTok that they tried three travel agents for a cruise booking and got a better deal doing it themselves, and the agents didn't know what they were talking about. Well, I once had a lawyer who never filed to dissolve one of my LLCs, costing me thousands of dollars in tax returns because he was incompetent. I learned very quickly not to be cheap when it comes to financial advice—great accountants, tax advisors, estate planners, and lawyers. From a legal standpoint, you want the best possible advice because it'll cost you more in the long run if you don't. That's when I went from spending $150-$200 per hour to $400-$500 per hour for legal advice.
The Viral TikTok Clip
Now let me get to the clip that went viral on TikTok. I'm going to show you what was shared and then provide the full context that everyone missed.
The Incomplete Clip
The clip showed my interview with Becky Lukovic, where I asked: "What am I leaving on the table by not booking with you?"
Her response: "There's definitely the usual—breakfast daily, full breakfast daily, hotel credit, all that. You can get that through some different channels. But for me, what you're leaving on the table is that Four Seasons Director of Sales or even the GM—when they come to Atlanta, we're at Ponce City Market having cocktails, we've got a candle-making class together. We're sitting by each other. They know me. Sometimes we're on each other's speed dial. We hug when we see each other. So when my travelers show up at the hotel, they are known."
The clip cut off right there.
The Pushback
A lot of the pushback was: "Yeah, so she gets to hug someone. Why should I care?" Or, "Oh, she gets to make candles. The GM gets to expense a steak dinner. How does that help me?"
Folks, it's called relationships. If the person booking you at a hotel has an intimate personal business relationship with the property, what does that mean to you? It means that should you want something out of the ordinary, she can make that happen through that relationship. You're just another number coming through the door. Sure, you'll be treated well at these high-end properties, but imagine someone with a relationship who can step in and do more for you.
The Full Context
Here's where the clip continues—the part that was cut off:
"We send them an email saying, 'Hey, my person's coming in. They have an anniversary,' or 'Just take some extra good care of them.' It adds to that whole 'see and be seen' experience without being a VIP who says, 'Don't you know who I am?' It's better for me to send a note saying, 'This person...' and maybe tell them a little about my travelers. Is it their first time there? Are they doing anything special? Do they just want to lay low and not be bothered? There are all kinds of things I share with my partners."
What She's Really Saying
She's saying she knows the customer better than the resort does. She explains what they're looking for in their trip, and because she has that relationship—the cocktails, the candle-making—with the person in charge of that resort and guest experience, she has a direct line to ensure they have an exceptional visit above and beyond a standard visit.
Not everybody wants that, and that's fine. But I know that when I travel and stay at a high-end property, I'm blown away by how they know your name: "Hi, Mr. Murphy, good morning. Can I get you coffee?" It's pretty nice. I don't know anyone who would complain about that, but sure enough, we had someone say, "I just want to get my key and go to my room."
Okay, dude, we're not talking about the Hampton Inn. I get that—when I roll in at 10 o'clock at night, just give me my key. But that's not what we're talking about. We're talking about luxury leisure travel.
The TikTok Comments
Let me jump to some of the comments on TikTok, because they're illuminating:
- "I never heard of a travel agent so clearly articulate why you do not need them. Her answer was 100% about her and 0% about her customer."
- "A travel agent so hotel executives can entertain them."
- "It kind of sounds like I need to pay extra so you can have drinks with hotel executives."
- "They know me means absolutely nothing."
- "This is like me expecting special treatment for referring people to McDonald's."
Addressing the Misconceptions
Let me address these point by point:
"Why are hotels wining and dining travel agents?"
Think about it this way: You think you're paying a travel agent, but number one, you typically don't pay a travel agent anything—they get paid by the resort. The resort sees value in getting business from travel agents because travel agents have thousands of customers. A typical travel agent could sell a couple million dollars per year to higher-end properties.
Why do general managers and heads of sales fly from places like Aruba to Atlanta and spend days and weeks at conferences and trade shows courting these people? Because they see the value these agents bring. They bring high-end customers and help create curated experiences based on their insights into individuals.
If I'm selling to my neighbor down the street as a travel agent, do I know more about that customer's needs, wants, and desires than the resort they would randomly pick from the thousands available? Between Cancun's Hotel Zone and Tulum alone, there are a thousand hotels and resorts.
Resort executives realize that each customer who comes through an agent represents just one of many that agent can send over the course of a year. That's why they do it. It's about return on investment (ROI). When hotel executives spend their company's money schmoozing with individual agents, they want to know the return on that investment. Obviously, they get a great return—otherwise, they wouldn't do it.
"How are you paying more?"
You're not paying more—you're actually getting a better deal. You're getting the same rate (best rate guarantee) plus additional perks.
"They know her means nothing."
They know it's your anniversary. The agent sets up a candlelit dinner on the beach, just the two of you, as a surprise. When you get to your room, there's a bouquet of flowers, chocolate, a fruit plate, maybe a bottle of champagne to celebrate. These little extras change a normal trip into an extraordinary trip. They know her, and that's important because now they have advance notice of the customer and their desires, and they bend over backwards to deliver an amazing experience.
The McDonald's Comparison
Someone said the Four Seasons doesn't depend on travel agents as a meaningful sales channel. That's completely wrong. Would general managers fly to Las Vegas for the Virtuoso conference to meet with luxury travel advisors, spend a whole week there, and spend hundreds of thousands of dollars if they didn't need the business? They're not just generous—they like ROI. Nobody wants to stay a week in Vegas. We go there because there are conferences, but nobody wants to be there that long. Do they want to spend $150,000 to sponsor a breakfast or dinner for thousands of people because they're generous? No—it's because they get significant return on that investment.
Final Thoughts
When you look at a clip on TikTok, it never has the full story. I'm not going to break up every video into multiple parts and make you hunt for them. I'm telling you: if you have more questions or want to dive deeper, go to the site. Listen on a podcast. Get the full context.
Here's what I wrote in response: For those wondering, it's about the relationship the hotel or resort has with the advisor, which includes perks that range from free nights to spa treatments to breakfast for the client. These are generally not available to those who DIY it using Expedia.
The Commission Question
"They get paid commission." Yes, they get paid. And guess what? If it's $1,000 per night and you book directly with the hotel, you pay $1,000 per night without extra perks. If you book it through a travel agent at $1,000 per night, the rate doesn't change (best rate guarantee), but you might get a free night, bringing your effective rate down to $667 per night. The resort or hotel pays the travel agent—the rate doesn't change for you.
Industry Communication Failure
This brings me full circle to the travel agency channel: How good a job have the associations in the travel industry done for decades to communicate the value of travel agents? Really crappy, I hate to say it.
I met with the head of ASTA years ago—over 20 years ago. I said, "You're spending $3 million on a campaign in USA Today that says 'Without a travel agent, you're on your own.' It's distributed in hotels that business travelers frequent—a lot of those people are already booking with travel agents. What are you trying to communicate?"
To this day, there's been very poor effort on that front. That's why I have comments like:
- "No need for travel agents."
- "Agents are the landlines of travel, so 20th century."
- "That industry is as dead as the dodo."
Yet the people at the resorts are tripping over themselves to get more business from these agents. I wonder why? Maybe because most people commenting aren't the clientele for luxury travel.
Choosing the Right Agent
There was one shining light in the comments—someone who booked their whole Disney trip with a travel agent who did everything for them, made all the dinner reservations, and made it a great trip.
The people commenting mostly have no clue. They're typically not booking four or five-star accommodations. This isn't about booking Carnival Cruises, where you don't typically get special deals through a travel agent. If you have to comment and display that you have no clue, it confirms you're not the target audience.
I know plenty of people, including family members who know what I've done for decades covering this space, who still do it themselves. I referred someone to a travel agent who specializes in anniversary trips, romance, and destination weddings—a big-time Sandals producer. They decided to save about $1,200 by booking themselves. When I followed up, they told me they'd taken the agent's research, then booked something completely different a few days later. They saved $1,200 but booked a far cry from what they outlined for their budget and the actual experience they would have had with the agent's recommendation.
Travel agents are salespeople selling a portfolio. Their job is to match you with the right product. You have to find the right travel agent.
A Medical Analogy
When I was getting treated for cancer in 2021—thankfully I was cured—I went for a follow-up in July. The vaccines were out by then, and they asked if I'd gotten the COVID vaccine. I said no, because I had natural immunity from having COVID three months earlier. They'd just drawn my blood, and my antibodies were through the roof.
They said, "We don't know how long natural immunity lasts." I asked, "How long does the vaccine last?" At that point, having all the time in the world to research data from Singapore and Israel, I knew the vaccine was failing. The numbers from Israel, with their socialized medicine where everything's recorded, showed it wasn't working. But they still thought I should get vaccinated.
The logic was: "We don't know how long natural immunity lasts." I asked, "How long does the vaccine last?" They said, "We don't know." I said, "I'm going to trust my body." How many times have I had COVID? Once. How many times have family and friends who got double-vaxxed and boosted had COVID? A lot. You probably know a bunch of them.
The Point
Just as with medical professionals, do I say trust everything a travel agent tells you? No. Validate it. Talk to customers they've booked previously who stayed at that resort. What made the difference? Find out how many times they've booked that resort—are you the guinea pig? Find out what kind of relationship they have. How long have they been in business? What makes you trust their advice if you've never been to that country?
In the end, depending on what you're doing travel-wise, you may find that doing it yourself is the way to go. Like I said, I do stuff myself, and I also use travel agents. I use travel agents where I get more value. I do it myself when it's simple point-to-point.
My Personal Approach
If I go to Boulder, Colorado, where my kids live and need to book a hotel, I look at the Fine Hotels and Resorts program to see if there's a property like The Julian that gives more value through the FHR program with American Express. If yes, I use the agent. If there are no properties walkable to my kids' house, I book it myself.
Do I need a travel agent to book an airline ticket for simple point-to-point travel? No. Am I a multi-million-mile flyer? Yes.
When would I use a travel agent? If I were going overseas and wanted to fly business class, I know travel agents can access consolidator fares—more restricted, but if my dates are set, I can save thousands of dollars. There are ways to find better deals, like booking through a codeshare partner at a cheaper rate for the same seat on the same flight. There are ways to work with different agency groups that can use miles to supplement purchases for upgrades. There are all sorts of strategies and techniques.
Your job as a consumer is to find someone who really knows what they're doing. Our job at Traveltube.com is to showcase these travel experts and give you insights into the products they're reviewing and their thoughts. You don't have to agree with everything they say, but put it in context.
Closing
If you see a 55-second clip on TikTok from a 55-minute interview, some stuff's going to drop off. Is it perfect? Nope. Unless you want to pay me to hire a video editor, I'm using Opus because it's cheap and nine times out of ten works like a charm. But this particular post went nuts and is still going nuts.
Hopefully we've clarified things. We're going to use Opus to break this podcast up and put out pieces with more context. Follow us on your favorite podcast app—Apple, Spotify, Amazon Podcasts. We're on Instagram, TikTok, Facebook, and YouTube. Look for the Traveltube.com logo.
Thanks for tuning in. This is Mark Murphy, and until next time, safe travels!
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