What A Year It Was

Obviously 2008 was a very difficult year for the travel industry. 2009 was not too much better; but there is some light at the end of the tunnel. When you compare the stock prices of a cross section of the industry all segments are up except for the airlines (who are dealing with fuel prices and ancillary revenue) and YTB. In fact, the average increase from 2009 to 2009 is 154%! Some notables are Expedia and Priceline--both up over 260%. Apparently they have discovered a business plan that consumers trust and support. Perhaps it is due to the fact that they hire travel professionals. Even the staid brick and mortar American Express is showing a 122% increase. Do the executives at YTB have a solid explanation for this? Certainly if the performance was close to the competition, but when your competition is showing triple digit increases and you are showing almost triple digit decreases, something is wrong!

Travel? What's That?

YTB is clearly moving onto different (not greener) pastures. Travel has really become a secondary (or tertiary) focus for the vast majority. In this video, Kim Sorensen proclaimed that YTB was "good friends" with the President of Costa Cruise lines and then proceeded to forget his name and relied on his daughter (Shelly Sorensen Coppersmith) to remind him--yes, nepotism is alive and well and earning big salaried bucks in Wood River.

If you needed further proof that travel has fallen by the wayside, watch what Shelly has to say about the YTB Seminar At Sea on the Atlantica. She had just returned from it and out of the 50,000 RTAS, there were "about" 60 on board.For the math challenged that is about 1/10 of 1 % of the RTAs that were interested enough in a travel product to attend a seminar at sea.

Happy Thanksgiving

More Deception

I watched this video (caution: 18 minutes long and very time-shareish) the other day and I seem to recall not too long ago that the very same Melissa Boston was speaking about how revolutionary YTB was because they sold travel. I have said for months now that they are re-focusing their efforts on other stuff and apparently the "other stuff" is now girdles.

As I was watching this, I just kept thinking that YTB is promoting this as something new; like they invented it or something. Just like when they went into travel; they proclaimed they were the ones that put travel and the Internet together. Invariably some will believe this.

The other thing that struck me on this video was that it was all about deception. Melissa talks about being sexy, looking sexy, and acting sexy. Doesn't it make sense that after all that looking, being and acting that you might actually become involved in sex?

What is the reaction of a guy or girl (yes, YTB sells man girdles too) who courts this "sexy" woman or man and finally gets down to business and "unwraps the package" to find out that they have been deceived all along. What they thought was a svelte and trim partner, is indeed really a human cousin to an Orca.

Then I realized, that deception is a way of life for YTB. Look at the false promises made over the years by the directors and recruiters. The deception cost them a million dollars in California and who knows how much in Illinois?

A New Look

I was bored with the old look. Check back as I tweak this some more!

The Coach, Scott and Kim Show

This bit of news from the Louisville area. Hmm, now who was the heavy recruiter in that area? Oh yeah, wasn't it Candy May?

Unmotivating Indeed

Good Solid Professional Advice

With so many people going AWOL in the middle of a cruise, one might think that advice such as this might not be the most appropriate coming from a "travel professional"

A grown Man can act a 'sho nuff Fool aboard a Carnival Cruise Ship....Cruise ship rules, y'all...remember!

But it's ok.

Now this is what I like to see! It's FUN FOR ALL~

It's Only A Small Hole In The Hull

When YTB ran into the iceberg several years ago, many (including myself) thought she would go down like the Titanic. There is good news and bad news. The good news is that the damage is done and apparently is unable to be repaired. The bad news, is that it is a smaller hole than originally thought and  it will be a slow and painful finish to the pyramid scheme.

A month ago, I predicted the number of RTAs at the end of the 3rd Quarter to be 52,000. I was close. The actual number is 50,421. Many thought I was way off base.  The most recent 10-Q was released on Friday (PDF, 159 Pages) and as expected the numbers are not impressive.  Just some highlights:

• Current RTAs number 50,421 ( a 9 month loss of 41,962)
  
• 3 months income comparing this year to last is down by 45%
• The 9 month net loss is $3.1 million (versus $3.4 million for 2008) despite having 64,000 fewer RTAs
• They have blown through 400K and are down to $800K cash available
• Their credit card processor upped their escrow to $3 million
• On November 5, 2009. two more Board members quit and required a very complete indemnity contract
• Nearly 70% of their business is still from recruiting. 22% from travel (3 months)
• 78% of of their business is from recruiting and 17.4% from travel (9 months)
• Travel Commissions earned this quarter are $3,642,000 (extrapolated that means that they sold $36M in travel. With a weighted RTA count of 53,688, the average RTA sold $670 in travel this quarter)
• Commissions paid to RTAs this quarter were $2,069,000. An average of $38.54 per RTA.
• Commissions paid to RTAs for the first 9 months of the year were $5,694,000. An average of $86.70 per RTA.
• RTAs appear to still be on target to earn just over $100 a year. This number has not significantly changed in several years.
• Travel commissions received this quarter have decreased 50.5%
• Travel commissions paid this quarter decreased 54.9%
• YTB has stated that due to poor sales performance, they do not expect to earn an override
• There is still no mention of revenue generated by YTB Cars, YTB Camping, YTB Romance, ShopYTB, etc.
• The Illinois suit is still hanging in the balance.
• The Class Action suit is still active and awaiting a judge's order for the plaintiffs to resubmit
• They have terrible terms on a loan on the headquarters which is rumored to be for sale in order to raise cash
• They were stiffed on the property they sold and need to foreclose on the property
• The result of the case involving the former Directors is still ongoing
  

The attrition of the RTAs is particularly interesting over the past year. It shows a decided lack of confidence in the program as well as a lack of results from their vaunted Directors--the ones that remain. While overall, the rate of loss has decreased--they are losing 144 RTAs per day this quarter as opposed to 193, and 289 per day in the prior two quarters. They are not recruiting nearly enough people to remain viable. This quarter, they were recruiting only 33 people per day compared to 45 and 83 in prior quarters.

The numbers suggest that YTB is consistently losing 16% to 18% of their paying RTAs per quarter. If this trend continues, the numbers will be under 20,000 this time next year, and under 10,000 by December 2011. The big question remains how long YTB can keep up the charade and continue to convince people to send in $600 per year for a measly $100 in return. Of course if YTB settles with Illinois for any substantial sum, it will also put another whammy on the picture.

There are a lot of ifs, ands & buts surrounding YTB. But for now, they are still around, and still selling travel (albeit at half the rate they were) and still recruiting people into the scheme.

The Dissatisfaction Continues To Fester

There is a discussion on the Coach Tomer Facebook Page that pretty much illustrates what I have been saying for many years. You can't make money in YTB selling travel. But this time, it is not me speaking, but those actually in YTB.

I actually do not blame anyone for this not working out for me. I loved what I was doing truelly I did, I would do it full time for my main source of a job if I could, however I just could not make any money at it, and what is worse, being a travel site owner and promoting travel, I really thought some benefit would come to me. I have traveled quiet a bit since becoming a RTA and when I tried to use my credentials, they basically would laugh at me, so I finally got to the point in saying if it does not benefit me, why go on?

Thank you though

Long But Interesting Reading

If anyone is interested in a long (146 Pages PDF) document, you can read about all the inner workings of YTB as they were transcribed from a hearing in the case against the departed directors--Bill Hoffmann and Kent McLaughlin.

You can see where they did indeed change the compensation plan, the forced acceptance of new terms and more.

You can download it here! Certainly will give some insight!