Latest news with #RichardTuren
Travel Weekly
3 days ago
- Business
- Travel Weekly
Explaining our industry using table seasonings
Richard Turen I found myself keeping a luncheon appointment with a trusted media source I talk to from time to time. This person is a great contact who has never worked inside the industry. This was all background, so I will not cite names. We met at a diner in Miami Beach. One of us ordered the Reuben sandwich. The other ordered a bacon caesar salad with dressing on the side. We both drank iced tea. It was 101 degrees in Miami that day. We made small talk. I was interested in advertising trends, and I was advised that social media advertising funds were increasing proportionally to the decrease in magazine advertising. However, it had not yet reached any critical thresholds. One fact that emerged was the data showing that travel consumers absolutely love "best" lists. Ad revenue tends to increase when best-of and "recommended" lists are promoted. But my source was clearly interested in pursuing one rather specific question based on the travel industry changes and news of the past six months. As the food arrived, the big question came with it: "So, Richard, we are wondering how someone like you would explain how the industry really works in a way that every consumer could understand. How would you make them understand how the hospitality industry, cruise lines and virtually every tour operator seems to be competing for your client's business while also, somehow, cooperating with you? We are wondering how you explain it in the simplest of terms to your own clients." The Reuben and the fries were getting cold. But I had to respond. I reached to the left of the tabletop and slid the salt and pepper shaker and a sugar bowl to the center of the table. "Let's start with the salt." I explained that the salt represents the profit margins on the travel product: a hotel room, a cruise, an escorted tour, etc. I talked for a few moments about the fact that most travel products have additional income from every guest in addition to the built-in price profit. In the case of a cruise, for instance, the spa, the drink packages, the shore excursions all add profit in the form of onboard spend. "So then, let's imagine an average supplier profit in the range of 4% to 6%." Then I reached for the pepper. "Too much of this can kill you. These are your expenses, all in, and if things are going well, total expenses are a little less than total revenue. "Every successful travel business needs to contain more salt than pepper," I said. I then cradled the sugar bowl in my arms before putting it in the center of the table. "This is the built-in travel agent commission. It is built into virtually every product in every facet of the travel industry. When it comes to cruises or tours, for instance, the commission will average 12% to 18%, or as much as triple the projected profit." "If any travel entity, be it hotel, cruise line, tour operator, etc., can convince the consumer to contact them directly via their website or the telephone, they have taken a significant step toward seriously increasing profitability, which is always the goal and is always Wall Street's expectation. The commission either goes into the pocket of the travel advisor, or it goes into the coffers of the supplier, dramatically affecting total profits on the sale." Of course, I explained, there are many variables, such as the very real cost of doing direct business and staffing res centers, and travel advisors, overall, bring higher-margin business than direct sales. "But in a nutshell, the goal of the game from much of the supplier side is to turn sugar into salt. That is how our industry works." As to "how we explain this to our clients, the short answer is we don't." Not yet.
Travel Weekly
12-07-2025
- Business
- Travel Weekly
How Regent's Seven Seas Grandeur stacks up
Richard Turen I've recently returned from a 12-day British Isles cruise out of Southampton on the Seven Seas Grandeur, the newest Explorer-class ship in the Regent Seven Seas Cruises fleet. I looked for the Picasso print in a public restroom, and I stood transfixed by the most stylish main dining room on any ship I have ever sailed, a space that features lovely contoured arches and degrees of dining separation that should earn at least one of the architectural firms that worked on this project some sort of industry award. The design features carried over into public spaces and the specialty restaurants to a degree that it might be a good idea for other ship designers to sail the Grandeur before taking pen to paper or fingers to AI design kits. Related story: The little things add up on Regent's Seven Seas Grandeur But this is reading like a PR piece, and that is not what I do. This was our family's second Signature vacation of the year, and we were accompanied by 28 extremely well-traveled clients, many of whom have achieved our Cruise Ship Inspector status. That means they have been trained and are qualified to review all aspects of a ship's operations. They complete the same forms that Angela and I use to take notes so that no aspect of a ship's services is overlooked. I had some excellent research from this group, which, in general, matched my opinions of what we had experienced. Let me summarize just a few of my opinions about our experience aboard Regent's newest ship: • Regent remains among the top five or six cruise lines in the world. Its uniqueness is centered on numerous inclusions like shore excursions and an absence of specialty dining surcharges. • Many of your clients will prefer Regent to the competition simply because their dress rules cater to an American audience. There are no formal nights on any cruise of less than 16 nights. Often, the sale is completed when this fact is mentioned. I laugh when I think about formal nights on Alaska cruises. How many of the wilderness houses one sees along the Inside Passage are owned by people who have a suit hanging in the closet? In a way, Regent just "gets it" in ways many of their competitors do not. They score No. 1 in the They Get It category. • I have mentioned to a number of cruise executives that any rankings I am associated with will never grant five-star status to any line that does not address onboard guests by name. That is a great point of differentiation and one of the reasons I have not previously felt that Regent was a five-star product. That has now changed. Staff is using iPads to write down guest requests, and they are being recorded for future use. • There were many pluses and minuses in the cuisine category. Pacific Rim may be the finest Asian restaurant at sea. Don't leave this surprise hit without sampling the duck rolls and the lobster tempura. But the contemporary French eatery Chartreuse was an ongoing disappointment. I don't quite understand why escargot is served as a kind of colorful fried meatball. My haddock was a hamburger-shaped piece of fried fish atop a small plateau of olives, looking to escape. • Services on the open decks and in several lounges were largely impersonal, with staff often unable to engage in conversation. This was not the case in the restaurants. All in all, the Regent experience was a major plus for our guests. When you are seeking to be the casual, high-end contemporary option competing with more formalized stalwarts, you play the game with some distinct consumer advantages. Next column, some port talk.
Travel Weekly
08-07-2025
- Business
- Travel Weekly
Keeping up with AI's advances -- and limitations
Richard Turen The advisor reaction to AI brings to mind Alvin Toffler's 1970 book "Future Shock." The point of Toffler's seminal work was that we were experiencing the downside of rapid technological advances of a type and quantity that was overwhelming to most of us. We are, he claimed, suffering as a society from stress and disorientation specifically caused by too much change in too short a time. Our brains cannot keep up with it. The stress is often related to our jobs: Will computers replace us? Our society, Toffler argued, is experiencing information overload that will cause instability in our social structures. What, I wonder, would Toffler say about AI? In sharing my thoughts with you about AI and its likely impact on our industry, it might be interesting to begin with robotics. That is one of the sexier branches of the AI revolution and, perhaps, the easiest to understand. Let's try to put robotics in perspective: The hotel sector is where we have seen the largest industry adaptation of customer-facing robots. Over the past decade we've seen a robot named Botlr at the Aloft Property in Cupertino, Calif., that delivers amenities to guestrooms. Making deliveries such as room service has progressed far more than we might imagine. It is now a worldwide phenomenon. The world's first robot-staffed hotel chain, Henn na, opened in Tokyo. At check-in, robotic receptionists, luggage handlers and service bots greeted guests. Humans were rarely involved. At the Hilton in McLean, Va., a robot named Connie was powered by IBM's AI. She/it provided guests with local dining, sightseeing and specific hotel service information. You might argue that these are just distractions. Hotel and airport robots can do some amusing and even admirable things. But they are also examples of the adaptation from simple beginnings of robots performing human tasks based on a strict command/request code to something more nuanced. Robotics has faced several hurdles, a primary example was the inability to teach a machine how to tie the shoelaces on a pair of men's shoes. They just couldn't do it. They can't account for varying lengths, degrees of tightness, etc. But in May it was reported that Google DeepMind had taught a robot how to tie shoelaces. An often-referenced hurdle has now been overcome. And now, consider the speed at which AI is adapting to fill the needs of counseling/advice and quick answers to guest questions. Last August, the Google DeepMind Lab developed a robot that could beat 55% of intermediate pingpong players it faced. It has made some progress since. The robot was trained by simply watching high-level games on video and playing actual opponents. There is so much to know about robotics and AI and their impact on our industry. But I think we first have to accept the fact that AI is not anything like magic. You are not creating a human. This is all about math. At its heart, what we call AI is a machine constructed of algorithms that can quickly, almost instantaneously, process information, analyze patterns and generate answers to queries based on its skill at finding the right answer across the field of millions of data points it can access. But the lesson is that we should never get too confident. Let's not get too confident about the limitations of AI. Some of our most successful travel corporations have learned that AI tools can now do two things rather successfully: They can solve problems with specific solutions and present information in what we might call a "meaningful conversation." Aren't we all seeking staff who can do that?
Travel Weekly
20-06-2025
- Business
- Travel Weekly
Is AI something we need to embrace ... or survive?
Richard Turen Consider this one in an ongoing series of columns that will eventually be written by AI, I'm sure. I was not anxious to open the door to this subject. Perhaps articles about AI's potential impact on our industry should best be written by those who study and design AI in the tech sector or at universities. Many travel advisors I speak to say they will embrace AI when it can do more. Some think it is a threat in terms of eliminating the need for professional, human advisors. Why, after all, rely on the travel knowledge and experience stored in one single brain when you can more quickly access the collective wisdom of tens of thousands? In our time together, I have not addressed in depth the potential impact of AI. I do not want to try to predict where it/we are headed. I do not want to pretend that I have any scientific expertise in the field. But I thought it might be helpful to devote some space to just talking through some of my observations over the past several years regarding the impact of amateur or, if you prefer, "artificial" intelligence on our industry. I have been keeping files on the progress of AI over the years, knowing I would write about it at some point when I felt I had a handle on the subject. Any objective observer would look back and marvel at the progress that has been made in technology in a few years and, all too often, in just a few months. Should we be worried? Should we be unusually proactive? Or should we do the one thing we as a profession never do: Should we actively communicate to our clients that AI is a potentially destructive way to enable a machine to plan the best moments of one's life? In wondering what the future might hold for our little shops that sell the world, I decided to start with the source: "While AI is gaining ground in the tourism sector, this does not mean that travel agents will disappear. On the contrary, their role is evolving. Rather than focusing on flight and hotel research, they can now focus on their true expertise: advising, guiding and offering unique experiences." That is not an altogether reassuring statement. If we lose the ability to compete with AI in flight planning and accommodations, does that mean that we all need to convert to the highest level of personal FIT planning? And will that be profitable? Do we want to engage in a profession where we are no longer trusted to do 75% of what most of us do for a living? I did not write the statement. Google AI wrote it in response to my question. It is the only part of this column I did not write. And it is interesting in terms of Google AI's confidence that it will soon be taking over several of the most critical functions we fulfill. And there is a question left unanswered: If our "true expertise" is offering "unique experiences," how will we compete with a technology that can scan tens of thousands of unique experiences at any destination in the world within moments.? A comment from respected Stanford professor Fei-Fei Li illustrates the major goal of AI and its immediate focus. She said there was a phrase from the 1970s that AI "is a machine that can make a perfect chess move while the room is on fire." Machines lack contextual understanding. Travel industry skeptics, and I am not one of them, claim that the lack of conceptual understanding is the reason that AI will never replace the home-based IC or the office-based corporate agent. Let's continue this conversation next time -- there may, after all, be a new AI breakthrough to report.
Travel Weekly
07-06-2025
- Business
- Travel Weekly
Are you booking or designing travel?
Richard Turen Looking back, I know that I would never have opened up a travel consultancy had I not worked the supplier side for quite a while. And I certainly would not dare write about our industry had I not walked both sides of the street. They are very different, even though they might be in the same neighborhood. I worked for one of the largest cruise lines, starting out on the West Coast. I visited travel agencies four days a week. I was a director of sales, and my job was to drum up business. But my reality was that our ships were starring in a little TV series called "The Love Boat" then, and they were sold out much of the time. I might have been a lousy salesperson, but no one knew it, and I was promoted to be vice president of the East Coast and the Midwest. Now I was responsible for 26 states; lots of agencies to visit. So starting on the West Coast and then taking on the East Coast and the Midwest, I was in and out of more agencies than I could count. During every visit, I was looking forward to discovering dozens of new business models. It would all be so stimulating. But it usually wasn't! There were precious few unique business models, and innovation was rare. Everything was sold on some sort of airline-owned CRM system. Airline sales made up just over 70% of a typical agency's sales. It was always the same scene. Two chairs in front of a desk with the client facing the back of the computer. And so it was for about four decades. Technology improved, and we noticed our clients searching online instead of seeking out a storefront. We were no longer booking robots; that could be done online. We started evolving into advisors. ASTA, an organization I feel has always had the collective backs of the membership it represents, caught on and went so far as to change its organization's name, with that last "A" now standing for "advisors" rather than "agents." We are now advisors -- sort of important to the families we serve. I see us as financial advisors, except our role is less about showing our clients how to grow their money and more about advising them on ways to dispense with some of it. Which leads me to an April article by Julie Bogen in the Washington Post. She explores the growth of the trend for agents to describe themselves as online travel "designers" who concentrate on creating truly personalized itineraries, travel troubleshooting and providing luxury perks. The article explains how contemporary consumers want to hire a "designer" instead of an "agent." The concept of a travel "agent" is now dated. Several successful designers are profiled in the piece, including one who created an itinerary with perks she felt would meet the needs of four prominent influencers. Sure enough, they liked the presentation, and it started being circulated on Instagram. Of course, a true travel designer has to be an FIT specialist, and some of you will surely feel that FITs are unusually time-consuming and less profitable than booking brochure programs. A travel office where every journey is custom-designed to meet the guest's profile may be fashionable, trendy, hip and always personalized, but I can't help but wonder what a travel design firm would need to charge guests in order to be profitable. I actually like the "designer" designation. I also like "travel architect" and "dream creator." It is possible that, at our best, we listen and then design what is best suited for the client instead of trying to sell them a program without taking into account their unique profile. But will we have to start spending more on our business attire if we start describing ourselves as designers? Will we need to be a bit more flamboyant? If we "flamboyantize" our industry in the months to come, I'm just not sure that my blue blazer will survive.
