By: Sandy Saburn, CTIE

It sounds like a great idea to have a steady pipeline of people who are interested in travel delivered to your phone or inbox. All you have to do is fulfill their travel wishes and you make money. Wonderful, right?

Unfortunately, the reality of leads is very different. In many situations, the leads that you are getting are from people who are shopping several agencies simultaneously looking for the lowest price. When you deal with what my dad called “tire kickers” you are going to do a lot more work for a lot less money. That’s fine if you are an OTA (online travel agency), but as a human being, you only have so many hours – and so much energy – in the day. So, before you jump into a leads program here are a few things you need to think about:

Where did the lead come from? For many travel agents, the leads come from their host agency. There are a number of agencies out there that promote themselves to consumers and they primarily focus on the lowest price. There are a few that focus on expertise and service, but for the majority, it is all about deals. If the agency providing the lead is known for discounts and freebies, they will attract people who are only interested in the very lowest price and are shopping multiple agencies to get it.

There are also programs that you can sign up for on your own that provide all kinds of leads from travel agents to plumbers and car repair. These services don’t often vet who they are recommending, it is just a clearinghouse of information. You pay per lead you get regardless of the outcome. This can get really expensive really quickly, often with very few – if any – bookings.

How does a lead affect the commission split? If the lead is coming from a host agency, the commission split probably won’t be the same as if the client was yours. Sometimes it is a 50/50 split and sometimes it’s even lower. Make sure you ask the question. Some agencies also impose fees or restrict which vendors you can book for the clients. There are agencies that pay you as little as 20% of the total commission. So, make sure you ask.

Whose client is this? Most agencies consider leads to be their clients, not yours. Meaning that even if you rebook the clients in the future those bookings may also be subject to that lower split – so you would constantly be working at a discount. If you ever leave the host agency those clients do not go with you, and you would be prohibited from reaching out to them and sharing your new information.

What’s the average closure rate? Of course, this varies from lead to lead and agent to agent, but every agency with a leads program has an average closure rate. They range widely from 10% to 60% (the highest I have ever heard), but the majority are closer to 10%. Let’s look at this another way: Between 40% and 90% of the time you spend working with these prospective clients is wasted. Even the very best salespeople don’t book everyone they talk to. And in some cases, the potential clients may provide an invalid email or phone number and you can’t even reach them, but that isn’t considered in figuring the closing rate. Many agencies will drop you from the leads program if you don’t maintain a particular close rate. Meaning that strategy you were using to build your business just got taken away.

But here is the biggest problem with leads: they give you a false sense of success. Being busy is not the same thing as being successful. You only have so many hours – and so much energy – to put into building your business. If you spend that time on leads that’s time you don’t have to spend on something else. Like marketing your business and building your brand.

It is really easy to feel like you are doing the “right” thing to spend all your time providing quotes to potential clients – especially when you are just starting out. But that doesn’t leave you any time to work ON your business. If you have your own travel business that means YOU are responsible for marketing and client attraction, not just assisting clients.

Bottom line: Leads are a numbers game and a great way to keep busy. But they aren’t a great way to build a sustainable business. Remember, staying busy doesn’t mean being successful. You are the boss now and you have to put on your CEO hat and work “on” the business, not just work “in” it.

Gifted Travel Network, Inc. | 425 E. Statesville, Suite 101, Mooresville, NC 28115 | (877) 982‐2842

Privacy Preference Center