The Fallacy Of Cheap

Travel Research Online
by Richard Earls

We have an obsession with cheap. Every travel professional knows that client who will spend relentless hours on the internet trying to beat the great cruise or tour package rate. Chances are pretty good with enough time on their hands your client can beat your “price.”  After all, they now know exactly what to look for, and there is always someone willing to sell cheaper. It’s easy for the client, armed with your information, to beat your price and then to invite you to participate, actually demand that you participate, in the race to the bottom. 

Will the situation ever change? Possibly, but not until travel planners of all stripes start training their clients on the difference between price and value. This is no easy task, primarily because many travel consultants often fail to make the distinction. Naturally, it is easy to illustrate that value is a lot more than price when we are speaking to your client’s behaviour. But how often, in your own travel practice, do you find yourself choosing the cheapest option, passing over the better quality choice, because of price and price alone? How often do you hear yourself asking “Who’s the cheapest?

I see this phenomenon when agents decide to build a website. I see it when they print business cards, create a logo from clip art, or adopt a “free” e-mail account for their business. I see it when they choose a host agency and far too often in the choice of a supplier. When we view the same type of decision making process in clients, it is easy to see the fallacy of the “cheaper is better” mentality. When it comes to running our own business, however, we too often adopt exactly the same skin-flint attitude that we don’t like to see in others.

How often do we lead with price in our advertisements, in our tag lines, or in our inadvertent comments to clients about finding them a “great deal?” What do we really mean when we speak this way? Do we mean a cheap price? Do we mean a great value? Beyond what we mean, what are we tacitly communicating when we speak to “bargains” and “deals?”

We have to take our own medicine and learn lessons at an emotive level. Intellectually we know there is a difference between price and value. At a gut level, however, we have a knee-jerk reaction in favour of the lowest price. There is a lesson to be learned somewhere here. If we can analyze and understand the reaction in ourselves, we should be able to train our clients to look at all the components of value, not just price. In fact, I would suggest that the analysis of value on behalf of your client is an essential part of being a top travel consultant. A 7-night cruise for $595 on a mass market cruise line is not a good value to many of your clients, regardless of how inexpensive it may be.

Travel is an emotional purchase for many, if not most people. Travel is also one of the most important buys and the experience of travel lasts a lifetime. It’s easy to see how going on the cheap is a mistake. Yet, if in our own business practices we veer to the same mentality, perhaps we are sending the wrong message and are being poor examples for our clients.

It’s worth thinking about. How well do you understand the fallacy of cheap?

Richard Earls is the Publisher of Travel Research Online, an online travel industry resource dedicated to enhancing the professional lives of travel agents.

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