By Virginia Van Zandt
Hiring is a big problem right now, but travel industry entrepreneur David Eisen has a radically different approach that is earning him outsized returns. His approach? He refuses to hire anyone with previous experience in a travel agency.
As a stand-alone agent, Eisen earned $255,221 in 2021 and more than $1 million in 2022. In the first months of 2023, Eisen has commanded commissions of $172,329 per month — putting him on track for more than $2 million in total commissions this year and $20 million dollars in sales. That’s 30 times what the average travel agent makes.
“Essentially, I’m the biggest travel agent in the world by myself. As a single, independent agent,” said Eisen, “I likely sell the most. All signs point to that.”
The largest travel agency in the world, by billings or commissions, is Carlson Wagonlit, which did $6.2 billion in sales in 2021. But that travel giant has 12,000 agents — generating an average of $516,000 per agent. Eisen is claiming that on an individual-agent basis, he earns more.
Since the average travel agent earns $30,000 per year, according to Zippia Travel, and Eisen claims he is making an average of $180,000 per month in commission income alone, this naturally provokes intense skepticism.
There is third-party evidence for Eisen’s income claims. Eisen was accepted as one of “The 1000”in January 2023, an elite club of the top thousand travel agents in the world with strict sales-revenue admission criteria. In addition, Eisen has supplied copies of sales reports that were reviewed by Zenger News.
And the revenues reports from Eisen’s company LuxRally Travel show that it is on track to generate $30 million in sales by 2024, up from $500,000 in 2020.
LuxRally is growing while many other travel agencies are dying. Some 93 percent have reported business income in 2022 down at least 75 percent compared to 2019, according to TravelPerk.com.
Eisen is apparently succeeding by following one of the oldest laws in business: If you want different results, you have to do different things.
And Eisen’s LuxRally Travel is different from other travel agencies in certain key ways.
One of the biggest is hiring. In order to continue to grow, LuxRally Travel needs to hire. “I’m creating clones of myself to try and replicate my success in my travel agency,” said Eisen.
David Eisen working from his phone at the Four Seasons Elephant Triangle in Thailand.
But how does a very successful solo practitioner, like Eisen, find other people that can generate results like he can? In other words the hiring and training process is a life-and-death matter for the success of LuxRally Travel.
First, Eisen had to develop a very detailed portrait of the kind of agent he was looking to recruit. One of the first things he decided is that he didn’t want to hire anyone with previous travel industry experience, especially former travel agents themselves. This is surprising because HR departments typically hunt for experienced workers; Eisen, like George Costanza, is doing the opposite.
Experienced travel agents, Eisen believes, have too many bad habits to unlearn.
Most of what travel agents have learned is to master an outdated workflow that is costly and slow and irritates customers. Traditional agents will have their clients fill in a 40-question travel preferences form, then book a consultation meeting, and then, finally, scour the internet for hotels and flights. Then the agent creates an itinerary, which can be up to 15 pages long, in which the client can request changes three or so times. The process to plan a trip can take days, even weeks.
Eisen aims to disrupt the industry by disrupting this outdated workflow. And to do that he needs to recruit people who are not wedded to the old ways.
Eisen’s agents are trained to perform all of the steps in the very first customer meeting, rather than multiple steps over weeks. That means that a successful recruit cannot be a travel agent who is used to a more leisurely pace, like a bank clerk, and must be someone who is excited to move fast, like a salesman.
As a result, Eisen and his agents can book hotel and airfare on a multi-city European trip for a client within 20 minutes. And clients can ask to change plans in real time, while on the trip, because the itinerary isn’t set in stone (cancellation penalties are applied in some cases). Instead of lengthy, wordy emails, communications are done via text.
Experienced agents also have higher training costs. “Sometimes people come with bad habits. When we look at what drives our success is that we don’t conform to what other agencies are doing. When we try and train agents that are already agents, it can take a year for them to unlearn their habits. It’s too much time to spend on training,” said Eisen.
Eisen has also taken steps to reduce training time and cost. All of his recruits receive 12 to 16 hours of online training, where they can learn at their own pace and rewind lessons as needed. That means that costly instructors don't have to be hired and people don’t have to be flown in to receive in-person training.
Following the online training, Eisen and his team perform many hours of 1-on-1 counseling. This, too, is done by Zoom or other video chat services.
David Eisen with a cigar in hand in Miami, Florida.
The results speak for themselves. Within weeks of training, one 18-year-old recruit, Evan Lynch from Long Island, was out-earning agents with decades of experience. The typical agent earns $2,500 per month, while Lynch has already earned $5,000 in commission from just 5 booked trips.
Lynch, who just sold a client a $50,000 luxury trip to Italy, became a travel agent only 4 months ago. He drove sales volume by tapping into his existing social network; in other words, LuxRally is growing the same way that Facebook did through social networks. Importantly, it is not a multi-level marketing scheme. Agents are not charged a fee to join and do not have to recruit other agents.
“You create your own motivation. You use your own discipline, and you use your own resources and you make money. And, you know, from what I'm seeing, pretty much everyone in the agency is working all the time. Everyone is motivated to make money and to, you know, really contribute to the business,” said Lynch.
While hiring and training are essential to LuxRally’s success, Eisen has been equally discriminating in choosing his customers. He doesn’t focus on price-conscious travelers seeking to visit grandma in Boca Raton or spend a weekend in Las Vegas with their girlfriends. Instead, he selects customers looking for unique travel experiences who are willing to pay for quality.
“I think he [Eisen] nailed down his niche and found his people. Helping anybody who needs help with their vacation is not something that’s repeatable,” said A. Lynn Blanco, host of The Travel Agent Podcast. “It’s really hard to market that way. From the beginning, he was around the right people and saw the need. You can’t be everything to everybody.”
While 70 percent of travel agents are older than 55 years old, according to a 2013 study from the American Society of Travel Advisors, the average LuxRally agent’s age is 29. Younger agents have fewer things competing for their time, like home repair, carpools, after-school children's sports, or ailing parents.
And LuxRally emphasizes speed. It measures and rewards how many bookings are made in each day for each agent, which leads to happier clients and higher revenues.
Another key takeaway from Eisen’s strategy is his company’s self-motivated culture, which he describes as an “ethical Wolf of Wall Street.” Each agent essentially runs their own small business within LuxRally by building their own network and remaining loyal to their clientele.
“We take all of the different ways we can deliver value and deliver each and every one of them at the same time,” said Eisen.
Agents both compete and collaborate, sometimes teasing each other, sometimes sharing ideas about hotels and airlines. But they cultivate personal relationships with clients, much like a bespoke tailor.
LuxRally’s corporate culture is a bit different too. Like the Madison Avenue executives in Mad Men, many of Eisen’s agents enjoy a cocktail and a cigar during their weekly review meetings held via video chat.
David Eisen and some of LuxRally Travel's' agents, clients, and concierges at the Nizuc Resort in ... [+]
Traditional travel agents do a bit of double dipping — they collect commissions for airlines and hotels while at the same time charge their customers a “service fee.” Some of these fees are quite high – such as a $300 payment for a consultation (which doesn’t result in any immediate bookings).
One of the things that sets Eisen apart is that he doesn’t charge service fees — at all.
The more lucrative way of doing business as an agency, according to Eisen, is to focus on commission. Although it’s common practice for agents to work on commission, the percentage that goes to them is low (usually about 10 percent). LuxRally’s commission rate ranges from 7 to 38 percent.
Eisen emphasizes the simplicity of his business model with his agents: “There is no buying trip vouchers or buying a membership or anything like that to become an agent. You sell a trip, you get a commission, and you get paid. You don’t pay anything to the agency upfront, and you don’t get paid until you make a sale,” said Eisen.
The American Society of Travel Advisors declined to comment on this story, but their travel advisor credo calls service fees a “best practice” in the industry.
LuxRally’s focus on providing built-in services without additional cost provide a valuable example for client-based companies. And a lot of the time, their agents find cheaper hotel rates with better benefits than an online search would show. An all-inclusive experience that is cheaper and easier than self-bookings is crucial to keep your clients happy. And yet, most travel agencies don’t utilize this basic principle.
“Hiring in-house concierges full time is a big deal. No other agency has 4- or 5-star concierges in-house that are offered for free to the client. We hire them out of hotels. With other agencies, you sometimes have to pay by the hour for concierges that may not have hospitality experience. “You don’t have to charge extra to increase client experience this way,” said Eisen.
LuxRally’s 24-7 personal concierges are more like personal assistants. So you get treated like you have an AmEx black card – even if you don’t have one.
LuxRally’s top concierge is Alex Ireland, a Liberian immigrant who became a hospitality legend by helping upgrade the Trump Hotel to the second Forbes 5-star hotel in Washington D.C. At LuxRally, Ireland helped a client heading to Barcelona with his in-laws, wife, and their two young children, who are huge soccer fans. Ireland arranged for the children to meet their favorite players on the field and in the locker room.
Ireland once helped a client plan his proposal to his girlfriend at a luxury hotel on the Greek island of Zakynthos – down to the sea-level dining table, a private boat, and two waiting glasses of Veuve Clicquot. After she said yes, the client asked Ireland to help him plan his wedding.
Because LuxRally is willing to zig while the rest of travel agencies zag, it is out-earning its rivals. And its willingness to rethink hiring, training, and customer selection are essential to its strategy. As companies struggle with hiring, maybe they should start with the question: do we want to reconsider what types of people we are recruiting?
