In case your wondering…no you didn’t miss some secret National Convention – Funshine – or some special Birthday Bash this week with YTB. With all the news in the past week, you’d think that there should have been something to get everyone together to celebrate what’s been going on.

Think about it…last Friday we release the new Group Cruise Page with Convergentware and posted a 10Q profit. Tuesday, the company hosted another Carnival Sail-a-thon and tied the Facebook phenomenon into the mix for a very cool and creative way to promote the best vacation money could buy.

Then yesterday, the company rolled out a wish list if you will. A small group of enhancements and improvements that those of us out in the field wanted to see to streamline prospecting and provide information in various departments and topics.

To end the week long list of promotions, enhancements and upgrades we come back to a topic that has been on the mind of many for quite some time.

It’s been over a year now since we first heard about YTB contemplating a franchise model. Soon after, California slapped a $25 million lawsuit with claims of some “gigantic pyramid scheme” in with it the day before the 2008 National Convention. I’ve heard rumor that the franchise announcement was nothing more than a “ploy” to stop the impending litigation which also produced a stance from the same clowns that it would never happen. By the time a settlement was reached (something else clowns never said would happen.) the court documentation that came out verified that a franchise model was required in California because in their eyes YTB was operating an on-line travel agency franchise without registering as one.

“Defendants have operated an on-line travel agency franchise without having registered as a franchise with the California Department of Corporations, in violation of California Corporations Code Section 31005 et seq.;”

By the way, I have no knowledge of any other company ever being accused of being both a pyramid scheme AND franchise at the same time – but leave it to California to be the first to do something like this. ;-P

So, we’ve been hearing about YTB implementing a franchise model for quite some time, and for months the home office has been preparing documents, manuals, and registrations for this new development.

Today, it’s time to take one more step towards making franchise a reality.

Starting today, November 13, 2009, there will be a link to a franchise seller disclosure form in your Rep Back Office. All Reps have to do is log in, answer a few questions, and submit the form. Once YTB officially implements franchise next year, (a little more that a month and a half away) we will be ahead of the game. (And yes, I intend on registering.)

The link will only be active for a limited time. And, you won’t want to miss out on your opportunity to be one of the first to officially register as a franchise seller with YTB.

PLEASE NOTE: All Canadian Reps who might sell a franchise in the United States should fill out this form in their Back Office. Once YTB implements the franchise model in the United States, only registered franchise sellers will be able to market the YTB Affiliate opportunity.

One last clarification – you’ll only be able to register for this document from the YTB Marketing side of the business. You will not find it from the Travel Portal. Remember Reps sell Internet Business Centers – and Travel Agents sell travel. They are two separate opportunities and models.

Wait – you already knew that didn’t you? Sorry – as you were.

Actually – log into you back office and get yourself registered…

Nice job, once again YTB! Thanks for all the info and opportunity to show folks that you’re not only still around, but have plans to be around for a long – long time. It’s been an awesome week.

Got to run…there’s a newsletter to produce with a ton of new content.

C-ya!

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YTB’s second weekend of the new RPM Training is now complete. The very first class was held just after Funshine in Orlando late last month, with the West Coast getting their first taste of YTB’s Regional Product Marketing this past weekend in San Fransisco and Irvine California. The remainder of the classes for the month of October have been posted in our weekly Newsletter for St. Louis and Kansas City, MO on October 17th – Atlanta, Detroit, Clearwater/Tampa, and Newark, NJ on October 24th – and the month will finish out in Dallas, TX on October 31st.

Additional cities will be announced for November as the company secures facilities to host it’s new training program. Plans right now include Las Vegas, Miami, Phoenix, and Denver, with additional smaller markets in the cities like Montgomery, AL.

As a reminder, RPM Training is designed for existing Reps with access to their back office, where you can find the exact locations for the training classes with instructions on how to register and pay for the courses. (A further review of the new RPM Training and what it entails can be found here.) It should also be noted that this training is for Associates and Reps, and not TSO’s. (TSO’s have First Class, E-Campus, and a plethora of supplier and industry association trainings they can register and participate in for travel related trainings.)

Here are a handful of comments received over the weekend surrounding the new RPM Trainings:

The RPM in Irvine was well worth the drive and the $ spent! Our Directors ROCK!
RPM was a one stop shop covering ALL our up-to-date and IMPORTANT INFORMATION!!!
~ Kathy and Robert V., San Diego, CA

So happy to see training for the REPs. Great Job!!
~ Tonia L., Austell, Georgia

I feel that all should enroll and complete this course. It means so much to know more about what we have to offer. How can we promote what we have if we don’t know ourselves.
~ Gloria E., Norfolk, VA

Being new to this business and still learning I found it to be very useful. I feel that any class I can take only helps. I look forward to more trainings. Very well prepared and presented by the 36 new Certified Trainers. Great training.
~ Angela D., Englewood, FL

I strongly feel that EVERYBODY, new or old, should take this course.
~ Barbara C., Hialeah, FL

I enjoyed this experience very much.
~ Debbie J., Anna, IL

Great course. Lots of good info. Would definitely recommend to team members.
~ Joseph B., Saint Petersburg, FL

Great training and very positive. Addressed the needs in getting on track and staying focused.
~ Gregory & Sandra N., Sherwood, AR

Thank you, thank you, and THANK YOU ONE AND ALL!!!
~ Sonya C., Raleigh, NC

The course was great! I kept saying how fast the time was going. It seemed like I just got started and before I knew it, it was over. It totally excited me all over again about the business that I have.
~ Mary V., Mays Landing, NJ

RPM Training Classes are taught by Certified Trainers who have been hand picked by YTB, bringing Reps the most updated, relevant information at the time. The curriculum includes a complete study of all YTB products, how to sell them, and how to build your YTB marketing business.

While it’s still too early to see any residual effects from a training like this, it looks to be a HUGE hit for those who took the time to invest in their business.

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Did you get your “Welcome Package” late last week for Convention?

If you haven’t seen it yet, be on the lookout for it because they are being sent via US Mail to all who have registered. With the Convention right around the corner, we got our hands on a couple of the BOMBSHELL announcements we’ve come to expect every year. In years past things like website upgrades, medical insurance, and the Bill of Rights have been announced.

This year will be no different.

Although we’ve heard that YTB is running out of money, (a new rumor we saw this week after our phone system crashed for about an hour Thursday morning) we caught wind of some new enhancements to pay to the field for both Website Sellers and Travel Store Owners.

Late last year, our Board of Directors suggested that in order to preserve the solvency for EVERYONE in the company, and because a these bonuses were being paid regardless of qualification, the company put a hold on the Director Bonus Program. After many changes, cutbacks, and redistribution of other funds, the Director Compensation is back.

The New Director Compensation is as follows:

a. All qualified Directors, regardless of level, receive a $2,000 Director check on July 20 and August 20.
b. Beginning September 20 (and subsequent months), checks will be issued on the following schedule:

(1) Level 1 Qualified Directors – $2,000
(2) Level 2 Qualified Directors – $4,000
(3) Level 3 Qualified Directors – $8,000
(4) Level 4+ Qualified Directors – $12,000

In addition to the Directors Compensation, there will be additional compensation announced at Convention for qualified Coach’s Corner Members of a “10% Performance Bonus”. This bonus will include your entire organization to the next qualified Coach’s Corner Member. The additional 10% will include all commissions paid to your organization for both Aisle19 (shopYTB) and travel commissions.

Although the travel industry has been in a tizzy over what it claims can not be more than a two way split of commissions, (that being the Agent, and the Host) the industry has been unable to produce, and we have been unable to verify any documentation or legal precedence that requires commissions be split only two ways. (In other words, it’s one of those “unwritten rules” in the industry.) Therefore, similar to the “$50 Bonus” we now receive that replaced the “$50 Reimbursement” of our web site fee with maintaining 6 additional Travel Stores, we will once again pay the “10% Override” in travel sales as a “10% Performance Bonus”.

The company realizes that it needs to incentivize team training and education when it comes to travel. This field training got YTB to where it is, (the 25th largest Seller of Travel in the Nation) and YTB is determined to reward those how help others learn and become successful sellers of travel.

Speaking of Travel Sales, would you like to learn how you can earn 100% commission on tavel? While we don’t know the exact details at this time, you will find out at Convention how to apply and train to receive an additional 30-40% on all your personal travel sales to with a 100% Commission Contract. We have also been told that as a Coach’s Corner Member, if you or anyone in your organization upgrades and qualifies for the 100% Commission Contract, your “10% Performance Bonus” will still be paid from those contracts.

The Franchising option we are currently working on for YTB also gave way to a new program that will allow a payment plan to get started as a TSO for $99.95. Website Sellers who sell this plan will receive 20% upfront and receive even more commissions over the 7 month installment plan by the new TSO. Associates who refer anyone to this plan will also receive their $50 for their referral.

There have also been many questions about the Aisle19 program and when the commissions will be paid. These are the “Downline Commissions”, not the “Cash Back” you have already received from personal purchases.

Aisle19 will officially change to shopYTB during the Convention and the commissions will be paid as follows:

a. January-March site owners 50% commissions will appear on the July 25 travel check.
b. January-March overrides will be included on the August 11 residual check.
c. April-current site owner 50% commissions will be in the August 25 travel check.
d. April-current overrides will be a part of the September 11 residual check.

While the process has taken some time, it looks to be “all systems go”, thanks to the fine work and co-operation between YTB and Aisle19.

Lastly, to answer your questions about bringing a guest to Convention, all you’ll need to do is accompany them through the registration booth at the America’s Center. YTB will have a convention bag and other materials ready for them! We are looking forward to seeing you and your guest in only 9 days!

Bring it on!

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Welcome to the next phase of YTB 2.0.

A year ago YTB announced the “contemplation of a franchise” in a press release issued just before last years convention. Today that “contemplation” moves one step closer to “reality”.

We touched on this with Sunday’s newsletter and wanted impress on you how this phase of YTB 2.0 will change how many perceive our model. By this time you have come across people who have a difficult time understanding and accepting Network Marketing as a legitimate business model. People don’t actually know that the nations oldest Network Marketing Company started as the California Perfume Company back in 1886. (In 1939 they changed their name to Avon.) Mary Kay is another example of a very powerful and stable MLM that not only markets to the same demographic, but was founded 46 years ago in 1963. Neither company has run out of woman to recruit, while basically limiting both companies to half the world’s population. (There may however be a few males mixed in with either company.)

Yet there are those that fear that someone will be crushed by a huge pyramid when there is no one left.

The suit filed by California was a perfect example of the ignorance our society has surrounding MLM Models. Without verifying, without even looking at our two models, the “Description of the Action” in the settlement stated “Defendants’ marketing scheme effectively requires participants to purchase a website from Defendants and pay monthly fees for the opportunity to recruit others”.

You know that’s not true; we know that’s not true. (Not to mention illegal.) The fact remains however, that because California said so, a portion of society will take this as fact instead of verifying if a statement has value.

Even now, with California behind us, with YTB still standing, still sending out checks, still winning awards, still growing as a travel company, there are those that still allow a tiny portion of society to dictate what they think and what they believe.

If you’re reading this right now you have endured a smear campaign of ignorance and fear mongering that included false claims of a gigantic pyramid scheme which both pro and con believed would finish the company. We want to congratulate you for holding on to your dreams, your vision, and your beliefs. Nobody should have the power to take that away from you, and we know many have tried.

It’s time to raise the bar. It’s time to look for better quality, better intelligence, and better business minds.

We now have a tool in place that can turn the tables, promote professionalism, character, and strength and it starts with you.

Moving forward, all potential California participants are required to wait 14 days before they are able to purchase a YTB Travel Store, or become an Associate who sells Travel Stores. So what does the 14 Day cooling off period have to do with Franchises? We’re glad you asked. (And even if you didn’t we’re going to tell you anyway.)

During this time, potential participants will be given all the facts and figures concerning the purchase of a franchise. In the settlement agreement which was filed with the courts the Description of the Action it states:

“Defendants have operated an on-line travel agency franchise without having registered as a franchise with the California Department of Corporations, in violation of California Corporations Code Section 31005 et seq.;”

We didn’t realize that we bought an on-line travel agency franchise until this was documented in the settlement. This is however a claim (Description of the Action) documented in the settlement filed with the courts.

We found the following reference in Franchising for Dummies by Michael Steid, and Dave Thomas. We’re NOT using this reference because we consider you a dummy, but because of its ability to describe franchising in a clear concise manor that we believe everyone will understand.

“Included in the regulations governing the sale of franchises is a cooling-off period called the ten-day rule. Franchisors are required to give their prospects a copy of the UFOC the first time they have a “personal” face-to-face meeting to discuss the purchase of the franchise, although most franchisors will provide the UFOC much earlier in the course of their discussion with a prospect. Franchisors must wait a minimum of ten business days after giving a prospect the UFOC before allowing the franchisee to sign the franchise agreement or pay any money to the franchisor. The purpose of the ten-day rule is to give you time to think about your decision.”

Please note that the 10 day rule requires 10 business days to expire. During the course of 10 business days you will have two weekends during that time for a total period of 14 days. If you would like to describe this as “10 business days” instead of “14 days”, you are welcome to do so, just as long as the word “business days” is made clear not to include Saturday or Sunday. (Six of one; a half dozen of the other.)

As we moved forward, the Settlement made with California also states:

8. Registration as a Franchise

No later than 30 days from the entry of Judgment, Defendants shall see the approval of the California Department of Corporations (DOC) and shall make their best efforts to obtain approval from the DOC to sell franchises. Any additional conditions or restrictions that my be required or imposed by the DOC for Defendants’ operation of a franchise shall also be required of or imposed on Defendants as part of this Judgment. If the DOC grants its approval for Defendants to sell franchises in California, Defendants shall begin offer such franchises for sale no later than 90 days from the date of the DOC approval. Neither the decision by the DOC regarding Defendants’ application to sell franchises in California, not the timing of that decision shall affect Defendants’ obligation to comply with any of the previsions of this Judgment.

There are 14 States that require Franchise Disclosures which include California, Hawaii, Illinois, Indiana, Maryland, Minnesota, New York, North Dakota, Oregon, Rhode Island, South Dakota, Virginia, Washington, and Wisconsin. Because of the one time expense of creating such materials, and our belief that a franchise model will increase retention because of it’s perceived value, YTB is moving forward with a franchise model both nationally and internationally.

This will take some time, and we do not know the exact date of the National completion at this time. However, once complete, YTB will be the largest franchise in history.

Some of you may be able to remember the 1984 Presidential Election between Walter Mondale and then sitting President Ronald Reagan. During the course of the debates that led up to the election, Mondale began to make Reagan’s advanced age an issue. President Reagan was the oldest President in history, and some of his staff commented that he was tired after the first debate with Mondale. In their second televised 90-minute debate in Kansas City, Reagan and Mondale debated on international policy and national defense.

Again the issue of age came up during the debate.

Reagan in his best awe shucks tone said, “I want you to know that also I will not make age an issue of this campaign. I am not going to exploit, for political purposes, my opponent’s youth and inexperience.“

Many didn’t like Ronald Reagan. (And you may be one of them.) Ronald Reagan was however a master in reframing and turning the tables on his opponents both within the political arena and around the world. Successful people and businesses turn apparent weakness into strength. They change history, and they change lives. We see California’s weakness and have now turned it into a strength moving forward.

Will everyone see it? Absolutely not. We were right on mark with the resurgence of activity and excuses on the forums, boards and blogs. Some still want to take your dreams and the power we talked about earlier. Some will still insist that YTB is nothing more than a “pyramid scheme”. Some will still laugh at you. If you want to give them that power, that’s entirely up to you. Why anyone would be willing to let others control and dictate what you think and how you feel is a completely foreign concept to us. Especially in a country such as ours during a weekend when we celebrate our Independence.

Remember, we need to raise the bar, not lower it. We joined YTB to pursue dreams not crush them. In the course of pursuing our dreams of owning a Home Based Business we bought into an MLM. What we’re going to end up with is a franchise.

The way we see it Scott was right…we’re bigger – stronger – superior in every way.

Who knew?

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Back in April we got word of a “tentative” settlement with California concerning this notion that we are some sort of gigantic pyramid scheme. I got word yesterday afternoon that the word “tentative” has now become “final”. I have to admit, when I read Jerry Brown’s press release, I was taken aback over his choice of words that he has “brought an end to an elaborate pyramid scheme“.

What brings calm to this situation for me, was clicking the link to the actual legal document that was signed and filed with the courts. I would also suggest to everyone in YTB that we focus on the legal documents here, and not get caught up in the spin of what YTB can and can not do.

YTB has been in discussions with California for the last two years. Fact is, YTB is ALREADY doing the vast majority of what’s mandated. There are however a couple of new items, which we will let you decide if they’re all that difficult to abide by. If you’ve been doing things right all along, there really shouldn’t be any changes in the way you conduct your business.

What I find interesting is that YTB is being required to file with the California Department of Corporations (DOC) and gain approval to sell franchises. Yes, franchises. From my understanding, documents are already in the hands of California at this time and it will take some time to get everything ironed out. (90 days plus according to the filing.) If a franchise is in the works for California, I would speculate that like everything else that we’ve put in place because of California the franchise will also go company wide. Currently I am aware of 14 states including California and Illinois that will require this type of disclosure to move forward. From all the phobias about MLM, I can only see this as being a positive move.

Question: Is this one of those pyramid deals?

Answer: No it’s a “franchise”.

It doesn’t matter that a franchise has many of the same features of an MLM, it’s the public perception here that counts. ;-P

Why YTB is required to do this and no other MLM is, I really couldn’t tell you. Fact of the matter is, YTB’s been singled out (once again) and we’re required to move to this franchise model in California and now possibly Illinois.

So let’s look at what’s “changed” here.

We must “change” as to not require a Website Seller to be or become a Website Owner, and shall not require a Website Owner to become a Website Seller. Since we’ve never required anyone to do one the other or both I really don’t see why this is even in here. That disclaimer has been on our Marketing Sites for years, and has also been part of our presentations.

No Website Owner shall promote, market, offer, sell, or make any representations regarding the Website Owner opportunity unless the Website Owner is also a Website Seller. If I own a Travel Website, and want to sell websites, I have to also be a Website Seller. I can however be a Website Seller only, which of course remains a free position with the company.

Many in the business didn’t understand why the booking engine link was removed from our marketing sites a while back. It was much easier to show our “product” this way. Many as well don’t see why YTB sends out a Travel Compass on Thursdays, and a Biz Report on Fridays. Why not combine the two?

Effective June 1, 2009 the Website Owner opportunity shall be separate and apart from the Website Seller opportunity and Defendant’s marketing, promotion and information regarding the opportunities shall be strictly separate. Information about the two opportunities shall not be combined in any brochure, flyer, advertisement, e-mail, internet advertisement, or any other writing promoting either opportunity.

Point is, the company made this separation ages ago and has little effect on how we currently promote the two opportunities with the exception of our live opportunity meetings. Thus the creation of the Travel Parties at the beginning of the year.

There shall be no fee to become a Website Seller, for any training or certification or exam related to becoming or remaining a Website Seller, or for any aspect of becoming a Website Seller. Mind you, “Website Seller” is formerly known as a “Rep”. Can anyone remember a time when YTB charged a single red cent for any of this?

We’re all aware of the Income Disclosure Statement we currently hand out. Like that’s a “new change”. We do however have to provide one for Travel now as well, but not together of course. (Remember the opportunities are separate.)

You know that about the SEC filings that states how many RTA’s we have, how many joined, and how many dropped out. Again, like that’s a “new change”.

The disclaimer we currently use for California that no one can guarantee your success, not everybody makes money in YTB, and that you don’t have to become a Website Seller is another “new change” that we’re already doing.

At this point in time, you may be asking yourself…what HAS changed?

Effective June 1 2009, Defendants shall provide a demonstration website for all Website Sellers to use to market the Website Owner opportunity, and all Website Sellers shall use the demonstration website and shall not use any other website to demonstrate the Website Owner opportunity.

Why? Because….

Website Sellers shall not represent or imply that a Website Seller must or should purchase a website in order to be successful as a Website Seller or that the purchase of a website may be used to help Website Seller sell websites. Why checking out BandBVacations.com won’t work for anyone who needs to check out how our booking engine works is beyond me. OF COURSE people want to see the “product” and if I didn’t have one, I’d show them one of the THOUSANDS readily available. But it makes the AG happy, so we’ll use a “demo” site to show people how this works.

Defendants shall not pay a Website Seller the full amount of such compensation unless at least 60% of the Website Seller’s total personal sales volume is derived from Website Owners who are not also Website Sellers. Meaning that you now need to limit the amount of Website Sellers in your business. You actually want people that are solely interested in selling travel. If you look at the Income Disclosure Statement from 2007, it documents that 80% of the people in YTB didn’t recruit a single person you quickly realize that’s not going to be hard to do.

The idea here is an attempt to limit the amount of income Website Sellers make. (Also known as “recruiters”.) Clearly, California and the “experts” who designed this didn’t bother looking at the Income Disclosure Statement when they designed this rule. With only 20% of the company acting as Website Sellers, it’s not going to be very difficult for Website Sellers in the company moving forward to make that 60/40 split. Unfortunately for California and other critic who have a phobia about “recruiters”, they got too caught up in the actual income and not how the large sums of income were actually made.

I’m willing to bet, much like the minimum booking requirements that are now out the window which we agreed upon years ago (that didn’t slow us one bit) that this too will be modified when they see how this new rule doesn’t work they way they want it too. I don’t mean to be nasty here, but this is a perfect example of how the Anti-MLM just follow along with the myths and don’t look at the documentation provided. What they think is a huge drawback in the compensation will hardly effect a single recruiter who knows how the numbers really work.

Oh, and if by chance this little 60/40 split does work, guess who keeps the money. Coach, Scott and Kim. The very 3 men they are trying to bleed dry of money.

Moving on…

There will be a 14 day “cooling off” period for anyone who is looking at the business. Mind you, during this period there will be documentation provided by the company to help them make an informed, educated, business decision. Commissions available, market share, the training provided, and company tools to help them become either a Website Owner or a Website Seller. (All part of the “franchise disclosure laws”.) All franchises have a “cooling off” period in the required states.

And finally…why the AG even needs to put this in here just goes to show how STUPID some people are when it comes to promoting their business. We are now restricted from spouting off income, compensation lifestyle, pictures representing homes, vehicles, or leisure activities to imply we live “the good life”. This is a business folks. And while these things can certainly be enjoyed from owning a business, don’t flaunt it in order to put someone in the business.

Also, none of us are tax experts, so don’t make claims about tax deductions without first telling them to consult a CPA before writing anything off.

So…what did all this cost YTB? Here’s the kicker and it wasn’t even close to the $25 million filed in order to “protect consumers”.

$400,000 went for a fine directly to the state. $475,000 went to pay the legal fees for the state…and $125,000 went the the ‘victims’ who claimed they got ripped off. Almost 90% of the money paid, the state will keep, leaving the ‘victims’ with the remaining 10%.

So much for helping out the consumer.

Not quite the monetary penalty that everyone claimed it would be. In one regard however, the simple filing worked like a charm for those who laid claim that California was poised to shut YTB down. Many listened and left. Some out of choice. Some out of necessity because their businesses had been ruined since they couldn’t or wouldn’t fall back on the product that got us where we are today. (Travel)

In closing…I wish I could tell you that it’s all behind us. However, it looks like Illinois was waiting in the wings and within hours of the final settlement being filed, Illinois has now decided to jump in to take their share.

Not sure how this will play out now that the franchise model is in the works. We did know this was a possibility and I suspect the franchise was brought in to prevent states from “piling on”. How this will all play out, even with all the “changes” we’ve made because of California…

Right now…I couldn’t tell you.

One thing I can tell you is this. Our Founders, Executives, and Attorney’s are working on a solution. I’d advise you to stay focused as well on the solution instead of the problem.

PS - If you're involved with YTB, sign up for our FREE Newsletter. As a Website Owner or Website Seller, we'll keep you up to date with all the latest news, acquisitions, and developments with YTB.

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I was introduced to a book a couple of years ago by Chris Anderson entitled “The Long Tail: Why the Future of Business is Selling Less of More “.  Mr. Anderson is the editor-in-chief of Wired Magazine. He wrote The Long Tail, which first appeared in Wired in October 2004 and then became a book in July, 2006.

While I usually find data and numbers extremely boring and it can make my head spin, Chris did an excellent job of injecting enough “layman’s speak” that kept my interest. I do enjoy reading about both business models and the men, (or woman in e-Bay’s case) who ran these successful businesses.

If your unfamiliar with just what The Long Tail is, and your in YTB, it’s best that you have a basic understanding of why this transition is important. In a nutshell, our culture and economy is increasingly shifting away from a focus on a relatively small number of mainstream products and markets at the “head” and toward a huge number of niches in the “tail”.

There are certainly examples of “heads” that are extremely successful, such as Wal-Mart for the mass appeal, or someone like a close friend of mine Nick McCulloch, who owns Link Your House, a specialty Home Automation and Security company. Here’s the rub concerning “real world” retailers. (Brick and Mortar) Due to exorbitant costs for space, you either need to select items that have a mass appeal, or scale back to reduce costs and attempt to focus on a niche market and hope there is enough of a local market to support your niche. 

An average movie theater will not show a film unless it can attract at least 1,500 people over a two-week run; that’s essentially the rent for a screen. An average record store needs to sell at least two copies of a CD per year to make it worth carrying; that’s the rent for a half inch of shelf space. And so on for DVD rental shops, videogame stores, booksellers, and newsstands.

In each case, retailers will carry only content that can generate sufficient demand to earn its keep. But each can pull only from a limited local population – perhaps a 10-mile radius for a typical movie theater, less than that for music and bookstores, and even less (just a mile or two) for video rental shops.

These costs however, drop dramatically in the digital world. Look at music stores like Rhapsody, a purely digital services with no manufacturing costs and minimal distribution fees. Because all music is stored in “bits and bytes”, The Who “Eminence Front“, a song or album that makes one sale per year has the same margins as a someone like Bruce Springsteen, “Working on a Dream” who will sell millions of copies after it’s debut at the end of the month. A hit and a miss are on equal economic footing because both are just entries in a database which are called up on demand. This make BOTH equally worthy of being offered due minimal or no cost, while increasing profits. In The Long Tail, popularity no longer has a monopoly on profitability. Unlike the Wal-Mart’s of the world with a little sliver of space to hold a CD that equals a cost associated with the space, and even that little CD needs to help pay the rent.

In “Brick and Mortar”, if you had to pick between a 1982 version of an old rock classic, and a new hit that’s already getting buzz due to President Elect Obama, which CD would you be stocking your shelves with?

Unlimited selection is revealing truths about what consumers want and how they want to get it in service after service, from DVDs at Netflix to music videos on Yahoo! Launch to songs in the iTunes Music Store and Rhapsody. People are going deep into the catalog, down the long, long list of available titles, far past what’s available at Blockbuster Video, Tower Records, and Barnes & Noble. And the more they find, the more they like. As they wander further from the beaten path, they discover their taste is not as mainstream as they thought (or as they had been led to believe by marketing, a lack of alternatives, and a hit-driven culture).

Combine enough small, obscure sales on the Long Tail and you’ve got a market bigger than even “The Boss” can produce.

Likewise,  in the case of books, the average Barnes & Noble carries 130,000 titles. Yet more than half of Amazon’s book sales come from outside its top 130,000 titles. Personally, I can only find a book I’m looking for half the time in a book store. Sure, they can order it for me, but so can I through Amazon, AND have it delivered directly to my home without the need of getting a call to drive back down to the store to pick the book up. If the Amazon statistics are any guide, the market for books that are not even sold in the average bookstore is larger than the market for those that are.

In other words, the potential book market may be twice as big as it appears to be, if only we can get over the economics of scarcity. Venture capitalist and former music industry consultant Kevin Laws puts it this way: “The biggest money is in the smallest sales.”

At this point, your asking yourself, “What in the world does that have to do with YTB?”

Take a look at all the niche sites this company offers in it’s digital arena. I know Travel Store Owners who specialize in Weddings and Honeymoons, others who specialize in Golf Packages, and still others like me, who specialize in cruises. Specialization is great, and I highly recommend that you find a couple of areas to specialize in when it comes to travel. But there are times when I run into areas I have no interest or knowledge in, but a potential customer or client may have a passion for.

A perfect example for me would be hunting. Honestly, I’d rather watch paint dry, but my In-Laws who I spent part of the Christmas break with are avid hunters. They also live about an hour and a half away from the nearest Bass Pro Shop. Is it out of the realm of possibility that they might have an interest in a new Hunting and Fishing web site that has comparable prices, that saves them both time and money?

That’s The Long Tail at work. I’m certainly not going to get rich off camouflage sales, but what did it cost me to carry the line as an Travel Store Owner?

Not a penny more than it did before I started…to sell cruises.

Let’s go back to Amazon for a minute. We all know them for their books and probably DVD’s and CD these days. What do you suppose happened that caused them to start selling groceries on a site known for books and DVD’s?? While you’re at it, you can fix the pesky light switch in their lighting and electrical department on isle five.

Are you thinking they might have lost it? Are they getting out of books because they’re making a mint off coffee and light bulbs? Or are they beginning to get the concept of The Long Tail?

Like Amazon who branched out in it’s distribution to capture ancillary sales, YTB is now moving into Food and Gifts, Home Decor, Financial Services, and Apperal and Accessories. Does that mean my passion has changed from cruises to carrot cake? Do I now need to be an expert or even remotely care about thread counts on pillow cases?

Hell no. Besides, if I did care about something like wellness and beauty, I could have gone with a century old MLM called Avon. (Unlike my love for a good steak or carrot cake, I don’t do makeup.)

I realize there are some who could never accept this shift in distribution. You need to remember, they’ll still hanging on to their “brick and mortar” theories and beliefs. Others will attempt to outwit and outsmart an experienced economic mind like Chris with their own excuses as to why this model simply won’t work.

So be it, if that’s their case. Just smile, nod your head, and say “Thanks for sharing”.

On a completely different note, and simply a followup on a previous post concerning Joystar just after Christmas.

It appears that a number of Agents have filed an involuntary bankruptcy case against Joystar in US Bankruptcy Court on Friday. They are seeking more than $150,000 in unpaid commissions that the agents claim are owed to them.

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At the end of yesterday’s post I asked the following question.

What do the following companies have in common?

• Carlson Wagonlit Travel
• Choice Hotels
• CruiseOne, Inc.
• Discovery Map International
• Hotel Indigo
• Microtel Inn
• Passport Health Communications
• Thetravelacademy
• Uniglobe Travel International
• Your Travel Biz

They’re not all host agencies, but they are all travel related in some form or fashion. No big deal, until you go pick up a copy of the November issue of Inc. Magazine and take a gander at the middle of page 138. There you will find “Candee’s Picks” for Leading Travel Franchise Opportunities.

“Ask Candee” is a column written by Candee Wilde specifically written about the franchise business and you can find some of her former columns on the internet where she has featured other franchise opportunities.

Q.  In these rocky financial times, is it wise to purchase a franchise in the travel industry?

A. There are few barriers to entry, in terms of cost or past experience, and even when people are tightening their belts, they continue to take vacations.

Travel is a solid industry, and the cruise business in particular just continues to grow. An investment in travel can be lucrative and, not to be underestimated, fun.

It’s important to note here that the actual article is written around CruiseOne, Inc. and the opportunity it has to offer. I could note here what some of the similarities and differences are for you here concerning CruiseOne and Your Travel Biz, however, I’ll let you pick up a copy on your own to decide for yourself.

What I would like to highlight and find interesting to say the least is that Candee noted Your Travel Biz with these other companies. To be listed among and associated with names on this list is a nice feather in the cap, especially when you consider the credibility of a magazine like Inc.. In addition, you can’t consider this listing one of those “paid endorsements” that YTB is accused of all too often. Nope, this one was even a surprise to Home Office.

Speaking of accusations, I have to wonder how critics will take this listing now that it’s been made public. I can just hear the ranting now.

Don’t they know what’s going on in California?

Have they not looked at the Financial Statements?

Have they not seen the stock price?

They’re not a “franchise”.

What does “Inc. Magazine” know about travel?

About all I can say about the excuses that are bound to come up, is this.

Not everyone has to agree with the negative perceptions and obsession about Network Marketing the way the critics do. Inc. Magazine is written for the entrepreneur, the business owner, the capitalist in this country. What a couple of broke critics who do nothing but post all day long on message boards, forums, and blogs with the intent to malign and slander a company they have never been associated with, nor never will have any involvement in, isn’t something the editors of Inc. are all that concerned with.

Furthermore, if in fact Candee was not fully aware of all the trappings some critics are concerned with, they might not doing a very good job in getting the word out. (Remember our Underground Shopper yesterday?) While I agree that Your Travel Biz is something critics seem to be up to their eyeballs in, very few people take it to the emotional extremes they do.

I can (and will) contend that the excuses brought up to minimize this association with other Leading Franchise Opportunities are just that, excuses. I’ve written about Pre-Paid Legal before, and it’s 31 lawsuits totaling $745 million back in 2002. I’ve also written about USANA and Herbalife in more recent issues and while our critics simply ignore how these companies not only overcame the obstacles set before them, they’re all thriving today.

While some would like to point out that profits from Your Travel Biz are not common place with the company, digging into the financials does show substantial purchases in land, support systems, technology, training, expansion into International markets, and a very large home office where they will reside when my kids have kids.

I have serious doubts that a publication like Inc. Magazine would even consider reading comments on some of the boards and forums out there to collect data for its publication. Although entertaining, smart business people don’t associate, nor do they care about this type of information. There’s no substance, it lacks verification, and it reeks of spinning.

It’s good to see a publication like Inc., and a writer like Candee picking Your Travel Biz as a leading opportunity.

Hummmmm, wonder what they know that the critics don’t?

PS - If you're involved with YTB, sign up for our FREE Newsletter. As a Website Owner or Website Seller, we'll keep you up to date with all the latest news, acquisitions, and developments with YTB.

PPS - Subscribe to the Just Picture It Now RSS feed, (including e-mail) for all the latest posts and updates found right here!

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Book Your Travel & Vacations With

Do You ZamZuu?