Silversea Cruises (www.silversea.com) sent a letter to travel agents on Wednesday -- outlining a new policy to protect luxury travel sellers against rebating by other agencies. The anti-rebating policy goes into effect Oct. 15.
"Of all the vacation options that are available, luxury travel can be the most profitable and rewarding product for travel agents to sell," said Ellen Bettridge, president of the Americas, Silversea Cruises. "But selling luxury doesn't happen by accident, there is work and commitment involved in the process -- from finding affluent customers and educating yourself about sophisticated luxury products and personalized experiences, to launching a targeted marketing campaign -- it takes time, effort and creativity on your part."
In her letter, Bettridge stressed that once agents invest expertise, energy and resources in designing and selling a luxury vacation tailored specifically to their client's needs, "nothing can be more frustrating than for you to discover that he or she has been talking with another agent who is offering a better deal, either by rebating their commission or through value-adds."
In strongly worded language Bettridge went on to say: "We feel this type of situation is tantamount to poaching and is basically a disservice to the travel agent profession."
To curb this practice, Silversea established a policy in 2005 that essentially required travel agents to charge the gross amount when payment is made by the client's credit card. However, based on feedback from many of its travel agent partners, the line is further tightening that policy against rebating.
The new policy is detailed as follows, and with some elements highlighted by the line in bold. "The steps we are taking may not be the perfect solution to this problem, but we believe they will help to discourage rebating, create a level playing field, and ultimately strengthen the agency distribution system," Bettridge told the agency community.
Silversea Revised Rebating Policy
Silversea endeavors to create an overall environment of fairness, openness, and transparency thereby reducing unnecessary poaching. Therefore, Silversea is pleased to have created a new policy which will enable its partners to focus on selling, building their business, and enhancing the consumer experience.
Accordingly, effective October 15, 2012, the following rebating policy shall apply to all travel agencies and partners:
No travel agency or company may advertise or promote to the general public Silversea’s products online (including on websites with restricted/ membership-only access), in print, or by any other means, at a price or at a discounted rate below Silversea’s published cruise fares unless otherwise authorized by Silversea. For purposes of this policy, Silversea’s published cruise fares are defined as those cruise fares which appear on Silversea’s website.
A travel agency or company may advertise amenities (over and above approved group related amenities) provided their total value does not exceed 5% of the cruise fare being advertised.
If a booking is transferred to another travel agency or a booking is cancelled and rebooked by another travel agency within 30 days of the initial booking date and before final payment, the originating travel agency will not be paid a commission while the new travel agency of record will be paid a 10% commission. For purposes of this policy, the initial booking date means the date the original initial deposit is received by Silversea.
If a booking is transferred to a travel agency or a booking is cancelled and rebooked by another travel agency more than 30 days after the initial booking was made or anytime inside the final payment window, a 10% commission will be paid to the originating travel agency and no commission will be paid to the new travel agency of record.
Bookings originating onboard through Silversea’s cruise consultants will be subject to the same policy if transferred to another agency other than the originating agency.
Silversea reserves the right to reduce commissions and/or marketing funds, cancel or deny group contracts or take any other actions it deems appropriate if a travel agency violates this policy.
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