Survey Also Finds Agencies Are Turning to ICs to Resolve Staffing Challenges

OYSTER BAY, NY (September 30, 2024): Agencies affiliated with American Marketing Group networks report their greatest challenges today are combating the competition posed by suppliers who accept direct bookings from consumers as well as online travel agencies.

A new survey of TRAVELSAVERS, NEST and The Affluent Traveler Collection agency owners and managers has identified their greatest pain points. Competition from suppliers who take direct bookings was named by 46 percent of those polled, while OTA competition was named by 35 percent. However, competition from other agencies and from AI were not seen as major issues.

“Suppliers that try to entice travelers to book directly with them and bypass the travel advisor channel are shortsighted,” said AMG Chief Sales Officer Kathryn Mazza-Burney. “Suppliers who are strong agency supporters consider the overall health of the industry. They know that clients who book through advisors spend more and are more satisfied with their travels. Those travelers also receive the superior service, personalized itineraries and peace of mind that advisors provide.”

Economic Mood

Consumers are grappling with multiple financial challenges including the growing cost of travel, inflation in general, and economic uncertainty during this presidential election year. Some travel agency owners and managers are concerned about the impact of the economy on their business. Thirty percent of those surveyed say the rising cost of travel is a challenge, and 19 percent are apprehensive about a drop in customer spending due to economic concerns.

“In spite of the economic headwinds, we’re seeing growth in bookings for 2024 and into 2025,” said Mazza-Burney. “For the rest of this year, we’re pacing up in a variety of categories including some double-digit increases. Those gains are on top of an exceptionally strong year in 2023. Our projections for 2025 are looking even more positive.”

Staffing Woes

At a time when the travel industry is growing and demand for the professional services of a travel advisor is rising, agencies are facing a shortage of qualified consultants. Thirty percent of those surveyed identified recruiting and hiring advisors as a challenge.

The scarcity of advisors is creating other challenges for agencies. Nineteen percent of respondents are concerned about handling client requests and bookings while short-staffed. Twelve percent worry about the mental health of advisors, specifically exhaustion.

Agencies are increasing turning to independent contractors to bolster sales, instead of hiring frontline staff. Twenty-four percent say they will add at least one IC this year, with 28 percent considering it and 48 percent saying they will not bring on any. Agencies looking to grow the number of ICs want to add three to four of them, with some saying they will take as many qualified consultants as they can find.

Just 17 percent of agencies surveyed plan to hire more staff advisors this year, with 28 percent considering it and 55 percent not planning to hire. The agencies that want to add staff advisors plan to hire two to three of them.

Agency Snapshot

The survey also gathered information on the size and location of travel agencies today, which align with industry movements towards home-based businesses with more ICs:

• Sixty percent of agencies have five advisors or fewer, while nine percent have more than 20
• About two-thirds are entirely home-based while one-third is based in a physical location such as an office or storefront
• ICs account for 50.5 percent of agency consultants, while the share of staff advisors is 49.5 percent. According to The Travel Institute, ICs represent 71 percent of advisors today.
• Fifty-six percent are full-time advisors, while 44 percent work part-time.

Survey Results

Greatest challenges facing agencies

• 46% competition from suppliers who take direct bookings
• 35% competition from online travel agencies
• 30% rising cost of travel
• 30% recruiting and hiring advisors
• 19% drop in customer spending due to economic concerns
• 19% handling client requests and bookings while short-staffed

Number of advisors at agency

• 60% 1 to 5
• 21% 6-10
• 9% 11-20
• 5% 21-50
• 4% More than 50

Advisor headcount compared to 2019

• 32% up
• 44% the same
• 24% down

Staff advisors compared to ICs

• 50.5% ICs
• 49.5% staff advisors

Agency location

• 65% home-based
• 35% office-based

Advisor schedules

• 56% work full-time
• 44% work part-time

Agencies planning to add staff advisors this year

• 17% yes
• 28% maybe
• 55% no

Agencies planning to add ICs this year

• 24% yes
• 28% maybe
• 48% no

Owners and managers of TRAVELSAVERS, NEST and Affluent Traveler Collection affiliate agencies in the US and Canada took the survey from August 12 to 26, 2024.

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About American Marketing Group, Inc.
Established in 1970, American Marketing Group is a dynamic organization encompassing 19 pioneering travel companies, including TRAVELSAVERS, NEST and The Affluent Traveler Collection. The international travel marketing leader is an essential business partner to agencies and suppliers, providing them with innovative products and services that offer a competitive advantage in the leisure and corporate markets. With a global reputation for excellence, AMG advances the trade through dedicated sales support, proprietary technology, networking opportunities, longstanding supplier partnerships and award-winning marketing. With more than 25,000 top-performing advisors generating $20 billion in revenue, AMG empowers its affiliates to achieve greater success financially, professionally and personally.