There is no question that travel has been one of the hardest-hit industries throughout the pandemic. With travel contributing over $1.1 trillion to the US’s GDP, news of a vaccination provides welcome relief.
The demand for traveling is still high, and according to CNBC, more than half of U.S. consumers say they will travel on vacation.
When asked how travel agents can make money, the obvious and simple answer is that they sell travel! But in this article, I’ll expand on what a travel agent can sell instead of focusing on high-level thinking of selling flight tickets or booking hotels.
There are so much more ways to make money as a travel agent and all of them are profitable.
As a quick recap, Here are some profitable ways travel agents can make money:
- Commissions
- Service Fees
- Group Tours
- Niche Travel
- Corporate Travel
- Consulting Fees
- Hotel Suppliers
- Tours and Car Rentals
- Airline Flights
- Travel Insurance
- Partnership Marketing
- Markups
- Premium Listings
- Affiliate Programs
- Through Concierge Services
The 15 Creative Ways Travel Agents Make Money (Explained)
As someone who is running a successful travel agency for years. Here are some insanely profitable ways travel agents get paid and make money:
1. Commissions
The most important way a travel agent earns money is by receiving a commission on travel sold. This can include a commission from booking flights, accommodation, tours, car rentals, entertainment tickets, insurance, and more.
An agent will always earn a commission on selling travel. Still, commission fees can differ based on the supplier they purchase from and if they are affiliated with a consortium or host agency, who will take a percentage of the commission.
Travel Agents can also earn more commission by selling add-ons such as additional travel days, tours, and trip insurance. A helpful example to explain what a commission could look like is if a travel agent sold a 5-night, 6-day cruise to a couple traveling.
The travel agent would earn the cruise commission but could also earn more if the travelers purchase tours from the cruise line and trip insurance. They may stay an extra night at the final destination too, which will add to the agent’s commission.
2. Service Fees
In addition to receiving commissions when booking travel, many travel agents will also charge a fixed service fee to all clients. This can look different for all travel agents. An agent might charge a service fee (ranging from $100-$250+) for all trips or offer a fee to help plan the travel.
Instead of booking all of the travel for a client, travel agents can also charge clients to do the planning and itinerary building and let the client book travel on their own.
Travel agents might charge a flat “planning” fee and then hand over the travel plans to the client once they are finished, and that’s all they will do.
3. Group Tours
Planning group tours as a travel agent can be a popular money avenue because of the large number of travelers at one time. Many travel agents will specialize in group travel, whether planning family reunions, destination weddings, hobby travel, sports travel, you name it!
As an example, a travel agent might book 50 cabins on a cruise and work on filling each cabin. They could focus on a niche, like a hobby or an event, that would encourage many people to book a cruise simultaneously.
The agent earns a commission on 50 cabins instead of 1 when a traveler books a one-off trip.
There are a lot of agents who will only do group travel since the value of earning a large income is so high. Some agents may even focus on planning 1-2+ large travel groups a year and earn their yearly revenue just by that alone.
The endless possibilities regarding group travel bring us to our next way of making money: Niche Travel. Combining a niche with group travel can be a great way to earn money from one trip.
4. Niche Travel
Another popular income source for travel agents is focusing on a niche so that they can create group trips or become a go-to source when a traveler is looking for a special travel experience.
Many agents have two businesses under one umbrella where they will sell travel anywhere in the world but also have a side dedication to a niche. For example, a travel agent might sell a lot of resort packages and cruises but then have a second business just for wine and food travel.
Even though there are hundreds of different niche travel options, Here are a few to give you an idea of what niche travel can look like:
- “Surprise” Travel: This has been a growing sensation for many travelers. Surprise Travel is when a travel agent books an entire trip for someone, but the traveler doesn’t know where they are going until the day before or when they get to the airport!
- Sports Travel: An agent might rent a charter bus, find 50 people interested in traveling to a sports game, and book hotels, activities, and transportation for the group.
- Destination Weddings and Honeymoons: If weddings and honeymoons are your jam, this is a great option!
- Disney: Many agents focus solely on Disney experiences, and these agents live and breathe it. They know each park’s ins and outs and can help customize your trip to fit your family’s needs.
- Special Needs: Focusing on a demographic can help choose a niche. Someone who focuses on special needs travel will be a pro at knowing what to look for when booking, what types of accommodation might need to be made, where to rent equipment, and so much more.
Above are just a few examples, but there are so many different niches available, and many that haven’t even been thought of yet.
If you’re interested in niche travel, ask yourself where your passion lies and see what travel experiences can come from.
5. Corporate Travel
Focusing on corporate travel is another option for your travel business. Instead of booking leisure travel, some agents will only work with corporate clients.
This can be a great option because you will have your main clients and know you will book travel just for them.
Booking corporate travel mostly includes booking flights, accommodation, and rental cars.
Still, since you know the quantity is greater, you can generate great revenue from commissions. Corporate travel can also include booking incentive travel or group retreats and events.
6. Consulting Fees
Many other industries charge consulting fees, so why should travel be any different?
By marketing yourself as a travel agent, you share your expertise and should charge accordingly. Creating itineraries requires time and research so a consultation fee will be applied.
Group bookings can be a logistical nightmare, so having someone manage the process for a fee will also be welcomed.
7. Hotel Suppliers
Independent hotels and other accommodation suppliers have individual deals or contracts with travel companies and agencies.
These deals can depend on company policy or the agency’s power to deliver to customers. In the case of hotel chains, the commission rate is typically established for all agencies and travel companies, who can then choose to sign on if the deal is sufficiently profitable for them.
The standard industry rate is in the 10 percent range. Still, special promotions such as Las Vegas wedding packages can offer up to 33 percent commission.
This amount is deducted from the supplier’s bottom line after receiving payment. It is then sent to the agency in a monthly statement after the traveler has returned from her trip.
8. Tours and Car Rentals
Local tours, rental cars, and transfers are another good part of the travel agent’s portfolio.
Since most tour operators and transfer companies are small businesses located in a single region, they are more willing to deal with successful agencies that can send them big numbers of tourists.
Rental-car companies, on the other hand, can be major players who set the commission rate for all agencies across the board. Suppose a particular agency has a preferred rental-car company.
In that case, however, the rate may be more geared toward agency profit than the others. The standard rate is around 5 percent, according to research. Still, the rate may rise higher depending on the agency’s specialty and any partnerships that may develop.
9. Airline Flights
Airline tickets are the least good part of the trip for a travel agent. The airline gives agents a set commission rate at the start of each year.
This rate is typically low and without room for negotiation. Since most travel requires some flight to be possible, the airlines are in a position of power and use that power to keep as much of the profit as possible.
Although the flight cost can fluctuate and may make up a large chunk of the overall trip cost, it does not bring in high profits for the travel agency.
10. Travel Insurance
Travel insurance is one of the most profitable items on the travel agent’s menu, boosting the travel agency’s profit margin. It is relatively low-cost and low-risk but comes with a premium price tag for the traveler.
Since travel insurance has nothing to do with the trip itself but is more of an add-on. Agencies typically reward agents for selling clients on the benefits of insurance coverage.
The insurance commission is higher than that for hotels or other travel necessities. Travel insurance is the one item on the trip itinerary that can easily be bargained down. Hence, customers often do some haggling to bring the overall cost of a trip down.
11. Partnership Marketing
Large agencies or chains may develop marketing deals with suppliers who wish to gain exposure to the United States market through brochures, TV and radio ads, trade shows, and other advertising avenues.
In exchange for a preferred placement, the promotion of a product line such as a group of Caribbean resorts, or a joint ad, the agency or chain may receive a one-time payment as the result of a marketing plan.
While these funds are meant to cover the expense of the ads and peripherals, they also amount to a profit for the travel agency.
12. Markups
Travel agents sometimes add a markup to their travel products and services to earn extra income.
For instance, a travel agent could add a $10 markup to a hotel room that costs $90. They’ll charge the traveler $100 for the hotel room, with the $10 being their fee for finding and booking the room.
The exact markup an agent charges depends on the products they’re selling and their arrangement with their supplier. The most experienced travel agents naturally have the highest markup.
13. Premium Listings
If your website generates a lot of traffic, consider selling advert space. This could be another way to make money as a travel agent.
Many travel companies will pay extra for a premium listing, as statistically, it can increase their exposure by up to 50% and generate an additional income source.
So, premium listings are another great way you can earn money from.
14. Affiliate Programs
Affiliate programs are another way that travel agencies make money. With this program, the agency agrees to promote a product or service on its website. The agency will earn a commission if a customer clicks on the affiliate link and purchases.
Once you are accepted onto a travel affiliate program, the fun can begin. Here are two ways you can use affiliate programs on your blog:
Refresh pre-existing content: You can tweak older content and slip in your affiliate links, providing they are relevant to the post. Expand your tale and emphasize the importance of travel documents and where your readers can acquire these.
This way, you strike a balance between great first-person travel stories, providing a service to your readers, and making some cash. As a bonus, Google favors blogs that are updated regularly, so this is also great SEO hygiene.
Create content: Your new affiliate program is a great way to brainstorm fresh content on your blog. Got accepted by a cool hotel booking website? Curate creative guides to accommodation in the cities you’ve visited and can talk about with a passion.
Alternatively, compare travel insurance companies that will cover vacationers if they are affected by the virus. These are examples of affiliate marketing campaigns that should lead to conversion.
There is a huge variety of travel affiliate programs to choose from. However, you must ensure you partner with the brands that reflect your mission and values. Only select organizations that suit the interests of your readers or clients.
Travel is a diverse category, so consider your target audience or customer. Whether your niche is adventure travel, unusual places, or a specific region, partner with brands and businesses whose products or services complement this.
For example, if you write for budget backpackers, you shouldn’t affiliate with a high-end product brand. Families seeking kid-friendly package holidays have very different requirements from luxury honeymooners.
Sticking to a niche in travel is the best way to ensure your affiliate content reaches the right audience. From there, you can offer services or create content that will benefit your customers.
15. Through Concierge Services
For an additional fee, some agencies offer concierge services to help make the trip-planning process easier for their clients. These services include making restaurant reservations, booking tee times, and arranging transportation.
So how do travel agents make money or get paid?
The answer, of course, will depend on your location, your partnerships, and your agreements. One thing is sure: tourism is a fantastic industry, and it rewards those who put plenty of effort, energy, and passion into what they do.
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Bottom Line
In summary, travel agents have numerous ways to earn money, including service fees, commissions, and selling travel-related products. With the industry’s growth, creative and knowledgeable agents can earn a significant income while providing valuable services to clients.
Exploring these different methods can help agents build a successful and profitable travel business.
That was all for this article, I hope you found this helpful. Thanks for taking the time to read all the way to the end. Stay awesome (:
Cheers!
