3 Real-Life Ways Travel Agents Save You Money (That Expedia.com Can’t)
Many an article has been written about why you'd use a travel agent. They usually cite saving you time, the expertise they bring to the table, and knowing you have an advocate if anything goes wrong as the most enticing reasons to use an agent.
Really? I agree whole-heartedly but let’s be honest here, that’s kinda hogwash if you aren’t sold on using a travel agent in the first place. You want tangible benefits—something you can experience right away, something you can’t get from Expedia.com.
So, let’s chat about 3 little-known ways you can save money booking with a travel agent instead of Expedia.com (or other OTAS -- online travel agencies).
1. You Can Pay in Installments (Deposit and Final Payment)
When you book your vacation online, you have to pay in full at the time of booking. When you use a travel agent, you can book by putting down a deposit. Yup, you can reserve your spot for as little as $100 per person1.
Here’s how paying in installments helps you:
A) It’s nice to be able to reserve your seats/room, even when you don’t have all the money. You can get early bird perks—plenty of room availability, the choicest of flights to pick from, and you can cash in on the early booking incentives from vendors—while still having months to budget and save for your vacation. Best of both worlds.
B) Maybe you’re still a skeptic. After all, you’re good with money—you have ample savings to draw from for your vacation.
I’m a saver too, so I’ll speak straight to your thrifty lil' heart. Compound interest. Keep that money in the bank with the rest of your savings and let it earn you some interest. Depending on the cost of your vacation and how far ahead you book, it can really add up. So next time you're tempted to scour the web for weeks, thinking you might find something for $50 less, remember you could earn that in interest and have a lot less stress.
Do Orbitz, Expedia.com, Priceline, etc. have the option for payment plans? Nope. That's only something you can get when you book with a travel agent.
2) Lock-in the Price and Space on Your Vacation for 24 Hours
When you book online, your space/price isn't confirmed until you've paid (in full). You could lose your seat during the checkout process or prices could change between the time you sent your friend the info and are waiting for their response. When you use a travel agent, they can put your reservation on hold, without you having to worry things will sell out or prices will change.
That's definitely handy, especially if you're coordinating travel plans with others. But how does it save you money? Basic market principles: when supplies start to dwindle and demand goes up . . . so do prices. A travel agent can put things on hold free of charge, locking your price in and reserving your spot before the inventory sells out. Online agencies don't offer that option.
When a travel agent puts your vacation on hold it’s typically for 24 hours, or in some situations it could be until the end of the day. Either way, being able to put things on hold gives you time to think it over, coordinate with the other travelers, and all the while, you know the pricing isn’t going to change and you won’t lose your space.
It’s also worth mentioning a hold is something agents do as part of their services, there is no charge.
Now, let’s talk air because that’s a little different.
3) Airline Tickets Can Be Put On Hold
I’ll start by saying not every agent is going to be able to do air-only bookings. Air that isn’t packaged (packaged = part of a tour/cruise/vacation package) is a whole different animal and not all agencies are equipped to, or want to, deal with it.
I mention this because if you call an agency and they say air really isn’t their thing, I don’t want you to be disheartened. Just like you'd check out different websites, check different agencies.
So, what can a travel agent offer you that you can’t get from Expedia.com? With online agencies, you can't guarantee your seat or price until payment has gone through. But agents can put your airline ticket on hold, which reserves your seat and guarantees the price until 11:59 pm that day (or, more accurately, the end of the agent’s business day). There is no charge for the hold2.
And if you’re booking full-fare tickets like Y Class, Business Class, First Class, an agent can typically reserve your seat with no money down for much longer, sometimes even up to the day before departure3.
Side note: This perk is different than the DOT 24-hour rule, which allows you to cancel your reservation without penalty within 24 hours of booking
DOT 24-hour rule: The DOT requires that as long as a ticket was booked seven days before departure, the consumer can cancel within 24-hours without penalty. You might have seen something like this on the online agencies' sites:
Free cancellations within 24 hours is not an online agency perk, that’s following the DOT rule. Travel agents offer you the same ability to cancel within 24 hours. Also note, the 24-hour rule is not the same as the holds agents can put on. An agent holds your seat and fare without money down. It allows you to skip the hassle of booking and paying for the ticket, then cancelling it the next day and waiting for a refund.
A Little Bit of Data
Okay, so you want some hard numbers. I don't blame you. In 2016, Travel Market Report referenced ASTA's report Best of Both Worlds: Quantifying How Travel Agents Save Consumers Time and Money, stating, "Consumers report that travel agents save them an average $452 per trip plus four hours in travel planning, and help them avoid costly mistakes."
How much is 4 hours of time worth? Well according to the Bureau of Labor Statistic, the average hourly wage in the U.S. as of Aug. 2017 registered at $26.39/hr. Over four hours, it'll save the average American $105.56, which is nothing to shake a stick at.
Why OTAs No Longer Offer the "Best Deal"
Travel agents had a huge setback in the 1990s when airlines cut commissions. You may have heard of it? To put it simply, with the commission cuts and emergence of OTAs, everyone thought travel agents were dead.
Excuse me for a second, we need to have some mood music playing quietly in the background for this next section . . .
No, but for real, you need to press play to get the feel I'm going for here! Don't be a fun-hater. Go ahead and press play, I'll just wait.
Okay! We're ready!!!
Ahem . . . time have changed though, my friend. Similar to the shift in the travel agent industry, OTAs and aggregators currently suffer from dramatic reductions in commissions and aggregate deals.
In a breakdown of OTAs in a 2017 article in WIRED, it explains that aggregators (OTAs) used to get their their discounted prices from vendors trying to dump empty rooms, seats and off-season inventory. In return, they'd make a pretty penny on the deal. But this was when there weren't so many OTAs in the game.
The hospitality industry realized OTAs were a bit like playing with fire. They could move inventory, but in return they required 20-30% commission. That's a steep price considering hotels pay travel agents 10-16% commission on bookings. With the cost of their distribution channel commissions nearly doubling, hotels are fighting to rein in costs. They're doing this by negotiating lower commission with the OTAs (which means someone — the traveler — is making up the difference), as well as guaranteeing the best pricing when travelers book direct (vs. an OTA).
What does this mean? Essentially it means that travel agents are competitive (and I would argue, winning) against OTA pricing. There isn't a secret database of deals that only OTAs have access to. Vendors realize that the 10-16% commission they pay travel agents to make and service bookings is a reasonable cost to acquire and service a booking.
But it doesn't end at pricing. Travel agents can stay competitive against OTAs in the manner of how the aggregators pull their pricing. In a Travel Market Report article, Smart Flyer's Mike Holtz offered this example, "if a family of four wants to fly American Airlines from Dallas to London, when they search for fares, travel websites will only show the lowest fare available for four tickets. But an agent might be able to find three seats at a fare hundreds of dollars less, with savings into the thousands of dollars."
And for the win . . . let's be honest, it's hard to deny that the customer service experience a travel agent provides (vs. calling an OTA customer service center) leads to much happier travelers. In fact, in the same article mentioned above, "63% of consumers polled said using an agent makes their overall trip experience better." I personally am still scarred from being sent in circles when dealing with Expedia's customer service center years ago.
Too often people have the notion that online agencies are superior to travel agencies. Not so, I say! The perks above are little-known (but super snazzy) and offer a compelling reason to try using a travel agent if you aren't using one already!
If you still aren't convinced, check out another article, "Using a Travel Agent vs. Booking Online."
Special thanks to the following agents for their insights: Bonnie Lee, Colleen Preston, Alyssa Schulke—you're awesome, thank you!
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The Fine Print
Lots of fine print. It's not because I'm trying to mislead you (I would have a guilty conscience forever if that was my MO) but because travel is complex and far from one-size fits all—there are multiple variables to take into account for each situation. But, I promise you, the bottom line is travel agents can do some really nifty stuff for you that an online agency cannot. Try one out.
>>> Editor's note: This article was originally published on Feb. 13, 2014, but was updated Oct. 5th 2017.
- Down payment perk: It can usually be found when you book this type of travel: cruises, vacation packages, tours. The amount of the down payment will vary based on your booking. If you’re purchasing close in (let’s use booking within 45 days of departure as a guideline here), you’re going to have to pay it all up front. No perk for you. ↩
- Air on hold perk: Travel agents may not be able to do this on every single airline but can do it on the majority of airlines. Flights close to departure may not be able to be put on hold. There is typically no fee to put the flight on hold but most travel agents charge a service fee for booking air only reservations. ↩
- Full-fare ticket holding perk: This perk holds the space, but does not guarantee the fare. The rule of thumb is that the higher the ticket class, the longer the agent can hold your seat without payment. ↩