The Airlines Reporting Corp. (ARC) said that Helix, the consortium-like program that is shutting down on Dec. 31, had succeeded in improving ARC’s image in the travel agency community, even if it fell short of other goals.
ARC launched Helix, a “boutique-style” program geared to smaller, home-based and new agents, in February 2011. The program, which initially atttracted heavy criticism from the agency community, provided agents with preferred supplier commissions, education and training and business services.
ARC informed Helix members by email last week that it was discontinuing the program.
“Although both members and preferred suppliers maintained their commitment to each other through Helix, the market and subsequent economics for all parties involved have led management to revaluate the program as a whole,” ARC said.
Market has changed
In an interview with Travel Market Report, Edyta Satchell, ARC’s director of product management , declined to be more specific, other than to say, “We had to look at our economics. The market has changed as well, [and] there were different market demands.”
At the outset, ARC said it aimed to attract 400 to 500 agents to Helix in its first year. At last count, Helix had 260 agency members and approximately 500 individual agents, according to an ARC spokeswoman.
Satchell, who joined ARC in March, conceded that “we didn’t see the uptake that we anticipated.” She also said sales growth was slower than projected.
Improved ARC’s image
Satchell said Helix was a success in other ways.
“We achieved our goals in many dimensions. It helped us build relationship with agencies and helped us introduce products which showed that we are agent-friendly and agent advocates,” she said.
“We are no longer perceived as, ‘What’s ARC? Accreditation? Debit memos?’ Our agents learned that we are more than that.”
Helix members “loved working with ARC,” Satchell added.
Frank Armstrong, co-owner of Cruise & Vacation Travel, an Expedia CruiseShipCenters affiliate in LeRoy, Mich., joined Helix a year ago. Armstrong said he was “shocked and disappointed” by the news that the program was ending. “We were very happy with Helix.”
Armstrong is also a professor in the College of Business at Ferris State University. He compared Helix favorably to several host agencies with which he has been affiliated in his eight years as a travel agency owner.
“Hosts tell you everything upfront to get you in, and then you find out the real package and you find out you’ve been shafted,” he said, referring to commission split arrangements. “Helix did not do that to us. You made your commission and all the commission was yours.”
Armstrong speculated that ARC failed to attract sufficient agent members to be of value to suppliers. “I think the problem is that they didn’t promote themselves well enough.”
While Armstrong said suppliers had started withdrawing from Helix, according to ARC the number of suppliers in its preferred program remained consistent at about 30.
Gary Fee, president of the Outside Sales Support Network (OSSN), also questioned continued supplier support for Helix.
“I’ve talked to some suppliers that participated in it – I got a few yawns. They said for a couple of thousand dollars, it’s worth a kick in the can,” Fee said. Suppliers may have been seeing “diminishing returns,” he added.
Helix also faced stiff competition from more established consortia as well as “a lot of host agencies that are very anti-Helix,” Fee said.
“I think it was probably a little misguided.”
Fee said he was among those who were troubled when ARC announced the launch of Helix in 2011.
“A lot of host agencies were not too happy with ARC being a competitor. It kind of went out of the realm of what they were established to do.”
Like others, Fee was concerned that ARC might misuse agency sales data gleaned from its role as airlines’ financial sales processing and settlement organization.
ARC’s agency programs
ARC plans to continue to invest in programs for travel agents, Satchell said.
“Rather than offering a consortium-like program, we will work on growing ARC Marketplace. Marketplace is one of our fastest-growing products; sales and transactions are both up over 50% this year.”
ARC Marketplace is a booking platform, open to all agents, that provides access to more than 10,000 commissionable products.
ARC also will continue to offer travel agent education and training symposiums similar to those offered through Helix, she said.
“We are very committed to the agency community. We will continue to be their advocates. We want to help them grow their business and to provide them with tools that will help them with that.”