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Travel Agents Say MoneySaving Is Immoral!
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Two weeks ago I presented a Tonight With Trevor MacDonald programme showing people techniques to haggle down the cost of a holiday. In essense it stems from the fact the same holidays are available at different prices at different travel agents, so you can knock down those prices.
Accoding to the Travel Agents' trade publication Travel Trades Gazette there's been uproar, and i've been accused of being immoral.
The technique I described mostly followed the three articles that follow
I absolutely and wholeheatedly disagree. I think this cuts to the route of what MoneySaving and Consumer Revenge is all about. The following is my reply (personally, not representing Tonight with TM) which will be published in the magazine next week.
Please do have your say afterwards and vote in the poll.
People haggling down their holiday costs? Wonderful news!
My philosophy is we live in an adversarial consumer society. A company’s job is to make money, nowt wrong with that. Yet a consumer’s job should be to maximise their cash too, nowt wrong with that either.
I’m purely, un-apologetically a consumer lobbyist. Billions are spent on marketing and advertising to help businesses profit, while consumers are sub-served, fending for themselves.
Remember the sales training you were given to close a deal. Why shouldn’t consumers have buying training? Let me reiterate, I don’t blame companies for trying to make money and flogging products hard, so why am I immoral for showing consumers how to do the same?
This response wasn’t unexpected. Over the years I’ve had many people support what I do until their industry is mentioned. It happened with mortgage brokers, banks, credit card companies and now travel agents.
I've had many past emails from travel agents complimenting the consumer-revenge bits of my broadcasting or website. I remember one who was so pleased with my “make free cash from credit cards” technique, he ‘emailed it round his agency’. Yet now it’s about travel, I’ve the horns of Beelzebub. So there’s no apology. No travel agent has to sell a holiday at an unprofitable price, it can refuse.
Admittedly normally I explain the full on haggling technique is best used in the ‘direct sales late’ market though, in this programme, we noted doing it with high street early bookings was an ‘experiment’.
Yet high street chains complaining ‘unfair to contrast us with direct sellers, we’ve overheads’ forget many of the same also run direct agencies and websites. If companies charge different prices to consumers depending how they buy, what’s wrong with consumers researching to find the right price?
Like it or not, if you sell big tour operators’ holidays you’re in a commodity market. Other agents may sell exactly the same holiday cheaper. Why shouldn’t consumers shop around, haggle and find best price?
The reason for the reaction is the technique works. If you genuinely provide great service, then don’t worry, I’m sure you’ll keep customers. My focus is price, not everybody’s is. Witness the ‘holiday’ programmes or newspaper travel sections showing beautiful destinations and persuading people to live the vacation dream. Any complaints about that?
In summary, nothing suggested was illegal. As for the morality, empowering consumers’ spending power isn’t immoral. Maybe next time you pay over the odds for a credit card, phone bill or shopping and need impartial pro-consumer activist advice you may think differently.
Martin Lewis, Money Saving Expert.
Please note, answers don't constitute financial advice, it is based on generalised journalistic research. Always ensure any decision is made with regards to your own individual circumstance.
Go Martin! I'm 100% behind you and I'm sure all other MSEers feel the same. If I were the Queen I'd give you a knighthood. I wonder if she visits the site? She certainly should.
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Maybe they should be asking themselves "is it immoral to charge customers at different rates?" Then we would all get the same deal no matter what. They are the ones who try to maximise profits by giving "bargains". If there were no "bargains" to be had then we would all happily pay the price asked.
About 10 years ago, you could book a holiday for two people in a 1 bedroomed apartment, end of story. Then, the Tour Operators decided that a 1 bedroomed apartment could quite comfortably sleep up to 4 adults, the other 2 sleeping on a sofa bed. So if a couple now want a 1 bedroomed apartment, they are now penalised for it being under-occupied, and must pay supplements to cover this.
The same applies to a family of 4 wanting holiday accomodation in that same 1 bedroomed apartment. The 2 children don't fully occupy that 1 sofabed in the eyes of the tour operators, so they too (on top of child prices) must pay under occupancy fees.
They have been ripping us off for years.
And don't even get me started on school holiday price hikes!!!!
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Just listen to the holiday horror stories you hear, how holiday companies have put profits before peoples safety many times. Ask them about there morals.
Ten years ago, there weren’t all these huge holiday hypermarkets around. How have they afforded this? - Huge profits!
We just want a competitive priced holiday, not loads of gimmicks (indoor water falls, indoor forests etc in loads of unjustified space) that hypnotises you into the holiday mood & lets your wallet run wild.
Next year we'll be millionaires!
Last edited by Derek_Duval; 01-02-2005 at 9:06 PM..
I particularly like the bit in the article where Ann O'Donovan of Thomas Cook says "All they are interested in is getting the cheapest price"........and?.......what's her point?
Maybe we should go in and ask for the most expensive price on a certain holiday... like 'reverse haggling'
Honestly Martin.... I watched your programme and I really don't think that what you advised was anything that many people haven't already been doing for years with their holidays. It 'did' give us good advice, esp about the cards and insurance, and may have given some people the confidence to 'haggle' a little more but why are they blaming you for it? I think they're using you as a whipping boy ( )
The competition is getting to them and especially since the internet came along, people know that they can book a holiday for a certain price online so many people don't even bother going to the travel agents.
I wouldn't lose any sleep over it, there's no such thing as bad publicity eh?
Don't worry Jay-Jay. I didn't lose sleep. Same way as someone inside first direct leaked a memo with the phases 'consumer terrorist' on after i'd told people how to get £25 free due to a loophole, of the old Barclaycard 0% for life loophole. I was overjoyed to hear people were haggling
Martin Lewis, Money Saving Expert.
Please note, answers don't constitute financial advice, it is based on generalised journalistic research. Always ensure any decision is made with regards to your own individual circumstance.
I am in total agreement with you Martin. I also do not agree with "home based" franchise travel advisors touting for business to dare i say the less experienced traveller on this site, but then that is just my opinion, and i suppose not everyone has the time or inclination to "custom build" their own holiday as a fraction of the price.
And in defence of the tour operators may I just add a few words of my own.
Don't forget tour guides, hotel/resort staff, airline staff, holiday rep's etc are among the highest paid personel in the world.
Also what about all those hote/resort destinations that are given no ceiling expense accounts to ensure your holiday is not only safe but enjoyable, allowing hotels and resorts to constantly update equipment and train staff to the highest levels possible.
What about the overly generous contracts given to tour destinations to ensure a high standard on arrival.
What about all the programmes set in place for the local community for off season bleak periods of high unemployment.
And come on after all its not like any of us need our money is it? it's plain to see the tour operators do and we should do everything we can to see to it that Martins evil deeds are not repeated.
Just how many of you out there actually know that Thompson Holidays is actually owned by a seventy two year old widow currently residing in a nursing home in Clacton and that the annual profits actually fall short by an amount of £1.62 of the required amount to pay for her annual care, her only option to avoid registering for state benefits was to set up a tour company and you would all see her in a bedsit in Manchester if you had your way!
Its about time this site diverted its attention to where its really needed! I saw one bloke in Tesco the other day actually weighing up two avocado's to see which was heavier before buying! What does he suppose Tesco are going to do with all the little avocado's then?
I'm disgusted with all of you.
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No travel agent has to sell a holiday at an unprofitable price, it can refuse.
[...]
Yet high street chains complaining ‘unfair to contrast us with direct sellers, we’ve overheads’ forget many of the same also run direct agencies and websites. If companies charge different prices to consumers depending how they buy, what’s wrong with consumers researching to find the right price?
Only the travel agent knows the true cost - they thus can ALWAYS make a profit since they, as you point out, can refuse to sell the holiday.
The companies have been more than happy to use the consumers' ignorance to price discriminate (sell the same service for differing prices to different consumers). To argue that giving the consumer the knowledge, information and power to remove this veil of ignorance regarding the price of a holiday is pure hypocrisy.
It's unbelievable that a representative of Thomas Cook states in her letter that "I’ve even had customers in my shop using mobile phones to get direct-sell quotes, and then trying to play us off against each other." Imagine that!!! A customer that doesn't want to pay more than he has to!! What a joke!: and it just goes to show the way in which Thomas Cook obvious regard their customers - with utter contempt if they have the cheek to want a good deal and not be ripped off. Perhaps Thomas Cook believe that consumers have money to burn or that they have some sort of special moral right to customer's money - but the last time i checked we lived in a democratic society with a free market economy. It works both ways - they can charge at whatever price they want - but it's only prudent for the consumer to try and pay as little as they want.
They seem to want money for nothing - it's interesting to note that another letter on that page has a response regarding the claim that travel agents are "headless chickens" - it's half true, whilst there are undoubtedly some good travel agents, others are simply outlets for the operators and receive a substantial commission for doing little more than taking the booking. It's immoral to think that some people believe that they are entitled to make a profit from doing very little and it's absurd to suggest that consumers should not try and get the best deal they can get.
The fact of the matter is that 'shoe-leather costs' normally stop the consumer for making extensive investigations into the true cost of a good or service - what Martin merely showed was how easy, quick and costless the reality is.
Quote:
Originally Posted by Jay-Jay
there's no such thing as bad publicity eh?
You sure -
What is worth noting is the names of the companies that have decided to complain about Martin's advice - clearly they do not have any confidence in their own pricing policies and their fear of competition would seem indicative of over-pricing.
Rip off britain is bad enough, but even tyring to get out of Britain isnt without its share of rip off travel agents, travel insurance, etc etc. I'm glad the travel agents are now a target. If they have not artifically inflated prices then what do they fear? They can say no to disounts, but it will mean people take thier business elsewhere. Sooner or later they will come round to our way of thinking and realise their customer base has dropped (we can hope!)
Ive only just finished reading youir book and was VERY impressed, and it was the wake up call I had needed. Have already started the wheels in motion to lower the interest paid to my lenders. The only way they will sit up and take notice is if more people do this. The banks make so much money from us, and now they are talking of bringing in more fee-charging ATMs so we need to pay them to get access to OUR money. Yeh right. Without going off topic any further, rant over, and I will tell everyone I know about this site and hopefully they will start making changes also.
Sorry travel agents, the minute either you or a competetor can offer the same deal for less than advertised by you in the first place due to haggling from the consumer, you open yourself up for exactly that to take place.
Being able to cut 10-100 pounds+ from the cost per head of a holiday (or anything for that matter) from the advertised price just to 'Close the sale' means that the cut was extra money you didn't really need to make your profit margin but would be a nice bonus if you got it.
If you are really offended by someone coming back and saying 'Fred down the street can give me it for £10 less' then you need to offer something Fred doesn't.
Rip off britain is bad enough, but even tyring to get out of Britain isnt without its share of rip off travel agents, travel insurance, etc etc. I'm glad the travel agents are now a target.
It's interesting to note that whilst Thomas Cook made a loss of €251m in the financial year 2003/2004, "the UK arm returned to the black to turn in a financial performance that was "one of the best ever achieved in its 163-year history"."
So despite "the impact on tourism of the war in Iraq, the SARS outbreak and continued fears of global terrorism" Thomas Cook still managed to make a profit in the UK. And they have the audacity to try and suggest that Martin's advice is in some way immoral.
I also found this article on the BBC's website from April 2002 which stated that "the Association of British Travel Agents (ABTA) says brochures prices are often inflated because the public expect to be offered discounts."
So even the Travel Agents' own Associate accepts that consumers expect a discount on the advertised prices. Surely not!!
To those of you that didn't read the letters page Martin posted - there was a Branch Manager for one of the Thomas Cook stores complaining about the "the general disregard shown towards agents – a problem typified by the tone of last week’s Tonight with Trevor McDonald: Holiday Haggles programme" and that "All [the customers] are interested in these days is getting their holiday for the cheapest possible price". It's very clear why Thomas Cook don't want you to concern yourself with their prices - they want UK consumers to subsides the prices that our European counterparts receive!
As a consumer I am totally behind shopping around and haggling for the best holiday price.
As an ex travel agent I do feel sorry for the staff in high street travel agents. Being told they need to sell more, being 'encouraged' to sell certain operators and this for minimum wage.
I worked for one of the multiples and it's embarrassing when someone comes in with a price from the same agent's website for less that we could sell it in the shop!!
I do agree with shopping around, but would not spend hours in a high street agency when 90% of the time you know you will end up booking on the net or via a call centre.
Over the last 10 years, even before we had internet access, I have organised our holidays independantly of high street travel agents. It is very much easier when you can go online and sort out hotels and flights. We have used Travelbag twice to book flights etc but only after extensive research to satisfy myself that I was getting a good deal. On the other hand my sister happily hands over £1500-£2000 for a week in Spain for herself, her husband and one child. The point is there will always be people who are wary of arranging their own holiday, need a rep in resort to sort out their little problems. Rep, do me a favour, usually the rep is about 19 with little idea of what's going on except where you can get P***ed for 5 Euros and desperate to sell tickets for the Tours.
The first time we booked flights and nothing else we went to America, where we had been royally ripped off by Thomas Cook 3 years earlier. (We paid well over the odds for a pokey dirty room in a scruffy hotel miles away from where we were led to believe it was going to be. Because we went at Easter it was very expensive, the hire car which was "included " cost a fortune in extras and it was again a dirty scruffy mess) Doing the trip independantly we hired a car at the airport got upgraded to a decent motor and got all the insurance in at the price quoted, no extras. We then drove to the area that we wanted to stay in and then found a hotel, negotiated the rate and looked at the room before paying. It cost about 50% less for the holiday than booking with Thomas Cook and it was 3 years on.....
Travel agents have had it too good for too long, go into a high street travel agent and ask about a resort, usually they haven't got a clue and just reach for the "airtours brochure", or whoever the affiliated travel operator is. With low cost airlines and the internet they are lucky to do any business at all.
The Tour Operators are selling a product from an industry which is renown for it's unethical and heavy-handed methods - the main example being the way it browbeats the accommodation suppliers into supplying the product at an almost unfeasible low price and then taking an age to pay them.
They can't have it both ways. They've had it good for too long!!
Pls be nice to all MoneySavers. There's no such thing as a stupid question, and even if you disagree courtesy helps. Take care over copyright. Use excerpts and links rather than copying long text. This site asserts copyright on all comments posted on the board.
Pls be nice to all MoneySavers. There's no such thing as a stupid question, and even if you disagree courtesy helps.
Travel Agents Say MoneySaving Is Immoral!
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