“It’s an extremely difficult time for the industry,” says Zane Kerby, CEO and president of the American Society for Travel Advisors (ASTA) during our phone conversation. Although this is a trying time for travel advisors, and the travel industry as a whole, Kerby reminds us that, “We are not a people who hunker down and watch television…once restrictions are lifted they’ll want to take the trips they haven’t been able to because of the restrictions.”
So though we are going through a tough time, Kerby has hopes for when travel rebounds.
We started our conversation discussing the challenges travel advisors are facing now. One, he says, is liquidity and “that has to do with months and months of commissions they live on drying up. With travel demands so uncertain from now moving forward, the outlook right now is pretty bleak. That’s why it’s important for ASTA to continue to petition the government for income relief for our travel reliance sector,” says Kerby.
“The second issue is that travel advisors are spending long days, and many of them weeks and months, cancelling and rebooking those dream vacations and business conferences and are essentially working for free to do that. The real challenge there is that they’re caught between customers both in the business and leisure side, and suppliers who are also struggling with liquidity, and whose cancellations and rebooking policies are changing by the minute,” says Kerby. Adding that, “This is a really challenging time for travel advisors.
“I’ve been at ASTA seven years and this is the most challenging environment that we’ve seen our members in, and we are trying to help them in every way we can to survive the storm,” says Kerby.
Keep Dreaming & Learning about Travel
“Now is not the time for planning trips,” he says, “but it is the time to remind people dreaming of those trips that they planned on taking some time in the future. A lot of bookings for 2021 are very strong—a lot of cruise bookings—and we hear from advisors that although a lot of early summer trips are cancelled or postponed, that people are booking further out. And there’s real strength in booking patterns for that late fall, fourth quarter into next year they are very, very good. That is one kind of bright spot here—it’s endemic to the human spirit that people want to travel and they’re only going to shelter in place for so long,” says Kerby.
“Obviously, this is a very serious health situation,” he continues, “and our entire travel ecosystem is based on a safe and secure airline system, and safe and secure hoteliers, and safe and secure cruise lines as well. So this is obviously a big challenge that’s facing our industry, but now is the time when travel advisors are definitely out there talking to their clients about future plans. And some of the things they can take advantage of and think about.”
You want to be prepared for when the all clear is given. It’s about preparing your business—that your customer lists are good, and making sure that you’ve maintained contact with customers during these tough times.
—Zane Kerby, CEO and President of the American Society for Travel Advisors
Many advisors have told Recommend that they’re focusing their time now on getting certifications, webinars, and participating in e-learning programs, and Kerby agrees. “We’ve also seen an uptick in ASTA’s online resources. We have a Verified Travel Advisor Program that teaches travel advisors marketing skills, sales skills and all those are oversubscribed at the moment. We put three of the nine modules out there as a free resource for ASTA members—legality, sales training, and marketing training—because we want people to keep sharpening their skills, and understand the legal relationships that they enter into when they become a travel advisor. Getting destination training and any other information that will help them to come back stronger is a great use of time right now.”
CARES Act
Navigating the CARES Act that passed by Congress last week might feel a bit overwhelming. However, ASTA is working with advisors to help them navigate through it. Kerby says there are three main buckets: one is for independent contractors and those self-employed members, which is a large portion of the ASTA members and the industry overall. “Thanks to the CARES Act, those people now have access to unemployment benefits,” he says. The second group is the mid-sized agencies who have payroll—“they can apply for a $10 million loan at a 1 percent interest rate, and a portion of their loan that is used for rent and payroll over the next several months will be forgiven; that’s another great program within the CARES Act,” adds Kerby. The third portion is $25 billion set aside for airlines and their ticketing agents.
Though he notes the parameters for that program have not been set aside yet, Kerby says that as soon as they are, ASTA will notify travel advisor members. “This can help take care of those who don’t fall into either of the other two programs,” he says.
He adds, however, that “this is a first effort as Congress passed three bills in 10 days. This is a Congress that’s deeply divided and on a good day can find it hard to get anything done, but the need and the speed of America losing 10 million jobs in the last two weeks certainly has the Congress’ attention,” says Kerby. “Republicans are more likely to wait and see how this first $2 trillion pumped into the economy is going to work and how much relief it’s giving. And the Democrats are already calling for additional relief.” However, he adds that, “At ASTA, we are definitely focused on getting our members the maximum amount of relief possible. With travel demand being so uncertain, and our members relying on commissions for travel in order to pay their bills, we realize the seriousness of the situation isn’t going to go away with one bill passed by Congress. These affects are supposed to last about three months.” That’s a long time for advisors to be left without an income coming in.
Additional measures need to be taken in order to restore confidence, and that’s what we need to focus on now.
—Zane Kerby, CEO and President of the American Society for Travel Advisors
Cancelling or Rebooking? That is the Question
With a laugh, he tells us, “that is so off the board. Every single person’s risk profile is different. It’s impossible to answer.”
During our conversation, we spoke about how it’s not always an easy decision for travelers, as many of them are losing jobs now as well, and rescheduling for the end of the year might not be an easy task when they might also be facing a difficult time themselves.
“It’s a really disruptive way how the United States handles this kind of thing,” says Kerby. “In other countries, such as Denmark and England, their focus is keeping people on the payroll. I think in England it’s 80 percent and in Denmark it’s 75 percent. The government there sort of takes over the payroll for companies for a while, not at the full 100 percent, but at a very substantial amount so everyone feels comfortable sheltering at home. The United States is much more disruptive where people lose jobs. In the Great Recession it took 18 months to lose 8.8 million jobs, and it took two weeks for this to kill or to furlough 10 million to apply for unemployment. That is astonishing.
“To your point,” he continues, “that will have a longer effect on discretionary income and that’s what people use to buy travel. That’s why we are focused on trying to make sure our members are made whole during this time because these are conditions that they didn’t anticipate and that no one can control. Frankly, the government bears some responsibility—I’m not blaming the government—but the measures that they’ve taken to make sure that public safety is priority one, has decimated, and will continue to decimate, the travel industry for the foreseeable future.”
Confidence in Travel
Now, for many advisors the question is, when this is all over, when will people be ready to travel again?
“The other thing we’re focused on is what types of measures are going to restore confidence in people traveling,” he says. “Is it a matter of widely available testing?”
He notes that test time now if you have COVID-19 or if you’ve recovered from it and have the antibodies in your system is 15 minutes. “When that gets down to five minutes, is it something that can be handled at the airport or at the cruise port? That sounds good to me,” he says. “If I know that everyone on this plane or the cruise ship doesn’t have COVID-19, or has the antibodies, then I feel much more comfortable plunking down my money to take one of these magical trips. Additional measures need to be taken in order to restore confidence, and that’s what we need to focus on now.”
Though nothing is ready yet, as ASTA wants to be cautious and respectful, they are working on messaging you will be able to share with clients in the future to help restore their confidence in travel.
This is going to pass so be prepared for when the uptick comes.
—Zane Kerby, CEO and President of the American Society for Travel Advisors
“This week is supposed to be the worst week of all, so we’re definitely in the background working to make sure when the time is right that we come out, and not only do we endorse measures from the government to restore faith in travel, but we will have messaging coming out as well to consumers to call their travel advisor and get back out there,” he adds.
Hope for the Future of Travel
When asked how he sees this current situation changing the future of travel, Kerby laughs as he says he doesn’t have a crystal ball. However, he adds, “Over the last 10 years, international travel has been on a tear—nothing has slowed it down—not MERS, not SARS, not even the Swine Flu. The only thing that has really slowed it down a couple of times in the last 20 years has been economic recession.”
He adds, “Long-term prospects of travel are very good. Are people going to be more intrepid, or slightly less intrepid? I am not sure,” he says. “I think it depends a lot on the measurements the government puts in place to restore confidence in the travel ecosystem.
“If they come out and they had a test that takes five minutes that you take while you wait for your bag to be screened, to prove that the things inside your body are as benign as the things you’re carrying with you…hey, I think you can see a sharper rebound or a V-shaped rebound. If we’re left to muddle through months and months of rolling regional blackouts, that’s not going to help anyone; and travel will suffer longer in that case,” says Kerby.
When discussing how travelers might travel in the near future, he notes it’s hard to know. But adds that, “The long-term prospects for travel are very, very strong. We are not people who sit indoors and hunker down, and watch television. People want to get out and see the world. I think social media has actually fueled travel in a lot of instances. People are wanting to get out and see iconic things and have unique experiences. Millennials are the largest age cohort in the United States and is possibly the most intrepid traveler that there is.”
He adds that, “In the shorter term could there be truncated trips or closer to home trips? Possibly. But there could be the opposite reaction too where people feel once the all clear is given they just want to get out there and take that trip that they haven’t been able to take because of the restrictions placed on them right now.”
What You Should do NOW
“What I would tell travel advisors is that this will—I know it’s cold comfort right now—but this is going to pass so be prepared for when the uptick comes, and to make sure that you’ve reached out to your customers and maintained that relationship so they’re thinking of you when bounty returns.”
We are not people who sit indoors and hunker down, and watch television. People want to get out and see the world. People are wanting to get out and see iconic things and have unique experiences.
—Zane Kerby, CEO and President of the American Society for Travel Advisors
Kerby notes that ASTA is very focused on providing resources to ASTA members so they can get the economic relief they need, and also asks advisors to keep feeding them information about the suppliers so they can help.
“Some of the cruise lines have been extraordinary in terms of protecting commissions for cancelled trips and they are to be commended,” he says. “There are others that have been less helpful to small businesses to protect and promote their product. We are working behind the scenes with all involved.
“Remember we are in this together. If there are other things that ASTA can do to help your business, please contact us if you’re an ASTA member, and if you’re not then join. But the thing to remember is that you want to be prepared for when the all-clear is given. It’s about preparing your business—that your customer lists are good, and making sure that you’ve maintained contact with customers during these tough times.”
Keep Your Clients Motivated
The way to do this, he says, is constant communication. Kerby adds, “Consumers rely on travel advisors for their knowledge of a very complex system. Sometimes it’s preferential pricing they can make available, other times it’s added value in other ways such as free breakfast or an upgrade. I would say, travel advisors, our future is very good. Our future is strong. Remember to market and communicate those things to your customers as often as the situation dictates.”
For more information, visit asta.org.
