While sales, cash flow, commissions and client services are the justifiable focus of home-based agents and host agencies, the future of both may depend on how questions of professional ethics and standards are answered. This holds true especially in the face of the proliferating multilevel marketing schemes and card mills that continue to challenge the industry.
One promising solution comes from the 18 members of the Professional Association of Travel Hosts (PATH). Led by Andi McClure-Mysza, president of MTravel.com, and a dedicated slate of elected officers, PATH is addressing the hard issues of ethics, standards and professionalism head on.
Formed in 2006, PATH members represent many of the larger, long-established host agencies. This includes PATH members who pioneered innovative programs that bring integrity to the host agency/home-based agent relationship.
Together, PATH member hosts account for about 8,000 agents with substantial aggregate marketing power.
“The industry is changing rapidly, especially for host agencies and home-based agents,” says Anita Pagliasso, PATH’s first vice president and president of Ticket2Travel. “PATH was formed to help deal with real issues impacting hosts, agents and suppliers.” Among these key issues, Pagliasso believes, is a clear-cut need for professional standards. Standards define the professional relationship between hosts, agents, suppliers and ultimately the traveling public. And as the only host-driven organization in the travel industry, PATH has clout.
There are many other hot-button issues, including commission policies, contracts, support, training, services and mutual obligations between the agent and host. PATH also addresses the key issue of professional obligations to business partners, suppliers and clients.
Ken Gagliano, president of Travel Professionals International (TPI), also sees PATH performing a vital service to the industry. TPI, as an example, is celebrating its 20th year as a host with more than 1,000 agents. “Like any established host agency, we have a vested interest in our service quality, the integrity of our product and our agents,” says Gagliano.
Anthony Gagliano, Sr., TPI’s founder, serves on PATH’s
board as Treasurer while Ken Gagliano serves on Vacation.com’s advisory
board. TPI is up-front about its support of PATH and its commitment to
maintaining the integrity of the professional travel agent distribution
Pam Miller, president of Magellan360 and PATH’s second vice president, is another PATH advocate. Miller sees major host agencies making substantial ongoing investments in marketing and technology, as well as education and support programs for member agents. Like Pagliasso and Gagliano, Miller sees tremendous growth opportunity for the home-based sector and for host agencies. But the growth must be based on a strong commitment to professionalism, standards of performance and integrity.
While all PATH members are competitors, they agree that PATH’s mission is to continually demonstrate to the travel industry community and home-based agents the value of PATH’s reputable host agency members. This was underscored at a recent board meeting (all PATH leaders are volunteers) in which PATH agreed to limit membership to host agencies. The supplier membership category will be changed to that of Supplier Partners. Independent home-based agents cannot be PATH members.
PATH also wants to attract other host agencies. McClure-Mysza believes that PATH offers great networking opportunities for host managers. She also sees that PATH membership will offer increased visibility for the hosts. This, in turn, will aid in recruiting and add credibility to well-managed hosts. It will also create a voice among hosts to leverage the value of PATH among suppliers.
PATH’s tough standards remain in place, including the requirement that PATH members separate their host agency operation from their retail travel sales of unrelated products, physically or by name. They must also provide support to affiliates in the areas of training, marketing and technology, either “in-house” or via third-party suppliers or consortia.
Especially important as an antidote to card-mill operations, the PATH member does not promote travel agent discounts and perks other than a listing of the agency’s benefits. Nor does it engage in multilevel marketing programs. PATH also has excellent relations with suppliers, and can help them reach home-based agents. Both NACTA and OSSN are PATH partners.
Still another welcome standard is that the PATH host does not recruit referral agents as part of a program to reward or encourage referral agents to recruit other agents. A one-time payment as a referral fee is excluded from this criteria, and a host’s primary income must be from the sale of travel. Under PATH’s guidelines, the host agency compensation models include commission splits, flat fees and/or invoice/transaction fees.
PATH encourages hosts and agents to review PATH’s website at www.path4hosts.com. The site offers both meaningful guidelines and policies that define a high-integrity host. It also helps define the core of a professional relationship between host and agent.
“There has been a proliferation of different host agency models emerging in the industry,” says Pagliasso. “It really does not matter if you are ARC or non-ARC or have 50 to 2,000 independent contractors. It’s become apparent that we all have common issues and challenges. PATH’s goal is to define these and address them or solve them for the benefit of all our members.”
Is there a bottom line for home-based agents? Clearly, yes. No sensible agent—whether experienced or new to the business—wants to invest time and talent in a host agency that can’t or won’t support them or their aspirations. By defining the proper relationship between agents, hosts, suppliers and consumers, PATH is making a major contribution to the fastest-growing segment of the retail distribution system.