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Looking for a bit of info on YTB? read this article below that was found online.
MP deflects concern as critics warn people not to expect a quick buck
Bermudians hoping to buy into an online travel business being promoted by former Opposition Leader Wayne Furbert are being warned not to expect big profits.
A Bermuda Sun investigation suggests that most people investing in YTB in the U.S. make their money by recruiting new subscribers, rather than from selling travel.
Mr. Furbert - who plans to launch YTB in Bermuda next month - denied yesterday that the company is a pyramid scheme.
The Bermuda Sun investigation also revealed that U.S. travel organizations are beginning to back away from YTB, calling it "a card mill" because its agents lack bona fide travel credentials.
Cheryl Hayward-Chew, vice president of Meyer Franklin Travel, confirmed travel suppliers are beginning to refuse discounts to YTB. She said people should do their research before signing up and warned that the people who are likely to make the most money are people at the top - those who buy in early.
There is heated debate on the Internet as to whether YTB is a pyramid scheme - whereby the money of new investors ends up in the hands of those at the top.
The conclusion reached by several websites is that it is a so-called "multi-level marketing scheme (MLM)", which has several elements of pyramid selling, but is legal.
New members invest $500 to buy into YTB and then to pay an additional $49.95 per month to have their own travel website. They make money from signing up new members and also receive commissions from travel bookings.
Mr. Furbert said since signing on with YTB he has set up his own website, and described it as no different from quickertix.com, which is owned by C-Travel, or expedia.com.
But the Bermuda Sun has learned that cruise ship company Royal Caribbean International and the International Airlines Travel Agent Association (IATAN) have both terminated their business relationship with YTB, calling it a "card mill."
Lisa Bauer, senior vice president, North American sales for Royal Caribbean, said in a letter to travel agents that Royal Caribbean "has a fundamental concern with the business practices of these companies" and that it is "taking this action in an effort to prevent a growing and troubling trend within the travel industry."
Required standards
IATAN has taken a similar stance because YTB travel agents do not meet its required standards of working a minimum 20 hours a week or earning a minimum of $5,000 in commissions or salary annually.
Mrs. Hayward-Chew said: "Whenever these opportunities come up - whether it's a travel scheme or something else - one has to ask, who wins? Too often, the people who get taken advantage of in situations like this are the people who haven't done their research.
"I've read through the details on the YTB website. The earnings in this scheme aren't for those who sign up. The money is made by the people who sign up other people. It's about making money for a few people at the top of a multi-level organisation.
"In this case, as in so many others, if it seems too easy, too good to be true, then it almost always is."
Mr. Furbert said he did not want to get into the technicalities of YTB, but said: "This is a legitimate business. It trades on the stock exchange."
The website Scam Types.com concluded last July that YTB was not a scam, despite the requirement to buy into the scheme, to recruit new members and also the monthly fee.
But it stated: "The only drawback I can see is that the travel industry is highly competitive so making sales and recruiting members may be extremely hard."
An article that ran in the Chicago Tribune in December found most YTD agents in the U.S. who make money earn their income by selling websites, not travel, and that many agents are out of business after a year.
The article worked out from documents filed with the U.S. Securities and Exchange Commission that the average YTB agent made $82 in commission for 2006.
YTB admits that the vast majority of its income is made from the sale of travel websites to agents at $50 per month than it does from actual sales of travel. In a filing with the SEC on late last year, YTB said: "Fees from hosting websites that we offer to home-based representatives make up over 70 per cent of our revenues. While our business model is based primarily on website hosting our various products and services, we do intend to pursue other sources of revenue to lower this percentage."
YTB went on to state that if there was a "substantial decrease" in the number of websites that it hosts then "our financial condition, results of operation and future growth may be substantially impaired."
YTB added that its business model could be harmed by possible law changes because it walks a fine line as a multi-level marketing business, and it could fall afoul of laws aimed at pyramid schemes.
"We are subject to the risk that...our network marketing programme could be found not to be in compliance with applicable laws or regulations."
Meanwhile, Mr. Furbert said he was offering Bermudians a business opportunity and that YTD is setting up operations in Canada and the Bahamas.
The Chicago Tribune article also quoted a warning about multi-level marketing plans on the U.S. Federal Trade Commission website.
It said: "Plans that pay commissions for recruiting new distributors inevitably collapse when no new distributors can be recruited. And when a plan collapses, most people - except perhaps those at the very top of the pyramid - lose their money."
Reader Comments
Posted: Wednesday, February 20, 2008
Posted by: John Frenaye
RTA Vs TA--I said I agree with the market share. You are indeed moving some market share to YTB but the issue you fail to recognize (yet point out) is that these people are untrained. There is an article on MSNBC about an agent that was not trained that made a HUGE mistake on a group cruise of 73. http://www.msnbc.msn.com/id/23238817/ No, it is not YTB but it could have and likely will be. Collectively, 140,000 RTAs have paid $84 million dollars to YTB this year in website rental fees alone! If their claim of selling $500M in travel is true, they MAY pay out $30 million to the reps. Collectively they lost $54 million dollars. Where did it go? To the top of the pyramid and to the executives at YTB who are NOT being paid via a pyramid scheme. Are you also aware that the executives--not the RTAs--are receiving travel overrides from the suppliers. These can amount to equal the commissions. Any way you slice it it is a bum deal. You seem vocal...care to put up some proof that you are making a living in YTB? How about a half-living? How about earning money that might put you over the poverty line?
Posted: Sunday, February 17, 2008
Posted by: RTA'S VS ta's
MR. John Frenaye. You have a habbit of avoiding the issues. I might spell somethings wrong, I might even write something incorrect, but it's better to say "I is FREE!" Than to say "I have a JOB!!! "( NOW back to the real Issues ) Let me help you. MARKETING 101... If you have 10 reps and each only sell $100 dollars worth of Travel for the year. How much did TRAVEL company Expedia.com. make off of them? The answer! ZERO! So if I have a hundred REPS that only do 100 dollars each HOW MUCH DOES Expedia.com. Make off of them. The answer! ZERO! If I have 100k REPS that sell $100 dollars each for the year. How much does Expedia.com. make? ZERO! Can you say MARKET SHARE!!!DUH!!! THE COMPANY IS GROWING BECAUSE IT HAS MORE REPS DOING JUST A LITTLE BIT EACH. AFTER AWHILE WHEN THEIR FRIENDS AND FAMILY NOW START TO BOOK WITH THEM... THAT LITTLE ADDS UP. NOT Expedia... who is NOW GETTING MARKET SHARE???
Posted: Saturday, February 16, 2008
Posted by: John Frenaye
RTA Vs TA-- your post was so poorly written I did not understand it when I read it. So with your latest post, I did re-read it and unfortunately it is still poorly written and understandable. For someone who claims to be a marketing expert, I would think that you might be able to explain whatever it is you are trying to explain a bit better.
Posted: Friday, February 15, 2008
Posted by: RTA VS ta
Mr. John Frenaye You have not responded to my reply to you. Is it because it made since? or is it that you only look for people the use @#% words.
Posted: Wednesday, February 13, 2008
Posted by: John Frenaye
Tommy-- You have quite the vocabulary. I surmise your mother is impressed. It is funny that you mention Dr. Seligman and his credentials. Yes indeed, this gentleman is one of the shining stars that YTB likes everyone to know about. I listened to his call and his credentials..Harvard Business School, Oxford, designed the anti-terrorism unit for th US Secret Service, and was the Executive Director of the SAG, and also was the VP of several large companies including FOX where he reported directly to Barry Diller. The funny thing was none of that is true. Harvard has no record, nor does Oxford, SAG--nope, Secret Service..nada (I live in DC so I have some inside info there)and it was funny but he claims to have reported to Barry DillAr--one would think he would know how to spell his name. As near as I can tell, this guy was a made up person by two directors with YTB created to just increase the recruiting. I have a full discovery on his mile high credentials here: http://notravelmlms.blogspot.com/2008/01/good-doctor-seligman-exaggerates.html
Posted: Tuesday, February 12, 2008
Posted by: Tommy
I believe that them idiots talking bad about ytb are brain dead. They dont have enough sense to get off thier lazy ass and give it a try. They were no good at anything else and know they wont be good with ytb. So if you get off your broke ass and have a garage sale, maybe you can come up with the $500 it costs to start your own business. Then you may have a chance at the good life. Until then stop flapping at your trap. You only get out of something the amount of effort you put in. Listen to Dr. Bob slegman. He has a stack of crudentials 100 ft. tall. He heard about ytb and dovve in. Harvard business school said it is the best hbb opportunity they have ever seen. So do your research you idiots
Posted: Saturday, February 09, 2008
Posted by: RTA VS ta
MR.John Frenaye let me help you. MARKETING 101... If you have 10 reps and each only sell $100. dollars worth of Travel for the year. How much did TRAVEL company Expedia.com. make off of them? The answer! ZERO! So if I have a hundred REPS that only do 100 dollars each HOW MUCH DOES Expedia.com. Make off of them The answer! ZERO! If I have 100k REPS that sell $100 dollars each for the year. How much does Expedia.com. make? ZERO! Can you say MARKET SHARE!!!DUH!!!THE COMPANY IS GROWING BECAUSE IT HAS MORE REPS DOING JUST A LITTLE BIT EACH. BUT NOW THAT LITTLE ADDS UP!AND THEIR FRIENDS AND FAMILY NOW START TO BOOK WITH THEM... NOT Expedia... who is NOW GETTING MARKET SHARE??? Now my last point is this. If people like you who flunked MKT 101 would sit down and stop writing on forms like this, more people would get in and the numbers that you qouted would be less. Most people who are ignorent read your post and make a bad decision based off of your not understanding of the what the business strategy is. YOUR THE REASON MOST PEOPLE FAIL!! WAKE UP! RTA vs TA--I totally agree about market share. But you are not really providing market share to anyone but YTB with the emphasis on recruiting and not on travel sales. As someone else pointed out 13% of revenue does not indicate that your business is in selling travel.
Posted: Saturday, February 09, 2008
Posted by: RTA vs TA
Mr. New Yorker I thought you were smarter than that..."I have no problem explaining. It's a pyramid scheme because eventually, you run out of people, even if you were able to open this up to the entire world. In order for this to keep working, you have to have an infinite number of investors. No matter how big and successful this thing got, you will eventually run out of people.( WOW!How Has MARY K! QUICK STAR aka AMWAY! and PREPAID LEGAL Survived 30, 40, & 60 years? I guess people are still looking for opportunitys. As for why the Govt hasn't stopped in yet, that's not for me to say. With any crime, you really need someone to make an allegation of being victimized. This is not likely to happen for a long time.( 60 plus years! isnt that long enough for even our GOVERMENT? ) The appearance of credibility is also factored in by having a senior politician promoting it.( DUDE QUIT WHILE YOUR IQ is still above 70. Your at a 70 1/2. ( Google IQ scores )
Posted: Friday, February 01, 2008
Posted by: Susan D.
I still have a problem gentlemen with the way you both are looking at this whole business model. First, Newyorker, you claim that there will come a day when YTB "runs" out of people. Well, curious thing about populations, they are born, grow up, and die, only to have others being born, growing up, and then dying. As long as there are human beings on the planet, there will ALWAYS be people traveling. Secondly, when Southwest Airlines first came on the scene, MANY airlines and others in the industry were "worried" about this new airline and were negative to its possibilities as a major carrier. Well, SW now carries 3 out of 5 passengers in the United States and even though they've had to change their hub many times due to industry game playing by other airlines and those "frightened" by SW's increasing power, they survived and became a well-known PROFITABLE carrier. Hmmm...again, traditional agents, like you Mr. Frenay, are the ones who are feeling threatened by organizations like YTB. Whether you like it or not, travel has begun the shift away from traditional brick-n-mortar agencies to the internet and it has been that way since the early 1990's. You honestly think that organizations like Expedia, Orbitz, Priceline, Hotels.com, and others are going to jump off the internet and strictly deal with agents? These agents, who will continue to pay enormous overhead costs to have a brick-n-mortar agency, will no more see their commissions change than we will. The internet is here to stay my friends and this is truly only the beginning of multiple industries gravitating toward the internet because of the mass exposure and appeal. I'm sorry Mr. Frenaye that your dollars are shrinking by individuals who are choosing to book their own travel and stop paying a middle man to look for the best deals. We, as individuals, are quite capable of finding deals on our own. But I think you are sadly mistaken when you believe that specifically YTB associates are NOT being trained and therefore not deserving of the credentials the industry recognizes - such as IATAN, CLIA, etc. YTB insists that their associates receive training and does not appreciate, nor condone, behavior by associates who try to receive discounts when they have not earned it. I hold a Master's degree and know the value of training and learning. Of course, not all people I'm sure share that view, but I know that YTB also attempts to safeguard the industry integrity by encouraging each individual to obtain training. That is why we are not called "Travel Agents," but rather we are called "Referring Travel Agents." I do refer people to my site and then allow the booking engine to do the work - just like when you use Sabre and other systems to search. Yes, you are more trained, but the funny thing, hmmm, when I have a client who wants some specific travel arrangements that I do not know how to help with in full, I can call the multitude of actual travel agents who work for YTB in their corporate office and get the help I need to complete a package for my client. These individuals at YTB have many, many years of experience in the field, just like you, and know exactly how to help. So, I know, I, for one, have chosen to take multiple classes and been trained by some of the top instructors from Carnival, Holland America, American Destinations, Royal Caribbean, TripTailor, Mill Run Tours; just to name a few. I have studied, taken tests, and earned my CLIA card, so please don't tell me that ALL associates with YTB are untrained, wannabe professionals, who are ONLY interested in selling agencies and not selling travel. The person who shared this business with me made over $20,000 last year by selling travel and sharing the business. Please don't accuse us of being any different than the online giants who spend over $5 million per week in advertising dollars to share their online booking engines with the world in the hopes that some click on their sites and book travel. The difference is that WE don't choose to spend those advertising dollars on advertising that may or may not work - hmmm, sounds like direct selling. WE choose to pay our people those dollars in the form of commmissions for advertising their individual sites to their circles of influence. If everyone does a little, then we have the market share. At the point we were rated by Travel Weekly, we had only been in business for approximately 6 years and yet we were rated 35th in the world for travel agencies and 11th in the world for leisure. What's your rating? I would rather have a piece of that advertising dollar in my pocket as compensation for the work I'VE DONE, as opposed to seeing the CEO of those other big online giants continue to reap higher and higher salaries and bonuses while all of the employees that work at those organizations stay on a fixed salary with only a few measley raises over several years of loyalty and work. Please do not claim to know what you are talking about unless you are involved in something like this and doing the work yourself. YTB has hit a mark that took Wal-Mart 15 years to achieve; Microsoft 10 years. Hmmm...this sounds again more like people who are afraid of YTB's success, like Southwest Airlines, than it does real logic and real information. I will grant you, I'm sure there are those who only sell agencies and do not focus on selling travel, but again, please explain the difference of someone who chooses to sell cars for a living, decides on working for a Chevy dealer, but REFUSES to buy or drive a Chevy. It is NOT a requirement in YTB to own both a travel agency AND sell the agencies. An individual can do one or the other or both - so if the person working for Chevy WANTED to buy and drive a Chevy and then promote the Chevy to their friends and family because they work there, like the make, and could earn a commission for selling to their family and friends, what's the difference? I'm sorry, but your logic doesn't even make sense. Since there will ALWAYS be people traveling, the internet is NOT going away anytime soon, AND travel has shifted more to the internet in the last 10-15 years (thus the 250,000+ brick-n-mortar agencies going out of business because of the internet explosion in travel), it seems to me that only those who have a vested interest in keeping brick-n-mortar agencies alive are going to attack us with a vengeance. There are many, many scams out there who do prey on people and their desire to end their financial struggles, but not ALL businesses in networking are scams and you need to be able to discern that. It is not your responsibility to save the human race by what YOU perceive to be a problematic business model; this is OUR fundamental right as human beings to make that choice. If we get "scammed," then maybe we'll have learned a valuable lesson. It is our job as human beings sharing this planet to help others see the error of a company's ways when in fact that company does NOT have integrity and only has a self-serving purpose. I cannot see where YTB fits this model simply because it follows a network marketing business model - that in and of itself does NOT make a scam. Again, most of business follows this type of model - the difference is in the independent reps versus the status of what you want them to be called - bona fide employees who have to clock in to a building at a certain time. Only those who feel it is THEIR duty or God given right to police ALL business and judge them as scams, unless they are traditional free-standing corporate structures with a typical corporate pyramid layout of Ceo on top making BIG BIG dollars and little guy on the bottom answering the phone, will see this as a scam and feel FEARFUL for the global public that YTB is committing some "crime" and should be stopped. It is not your job to protect me - it is my right as a human being living on planet Earth to make a decision about MY money, MY time, and MY "repuation" or character. Just because it is based on a premise you don't like, you call it a pyramid scheme, but the last time I checked MLM law, to be a pyramid scheme requires that people are paid a hefty commission simply for BRINGING people into a business where no real product has a chance to be sold. Hmmm...selling travel and also selling travel agencies sound like real products to me, so again, I'm not seeing the pyramid you speak of. I have seen true pyramid schemes before, and this is not one of them. Does anyone call Avon, Tupperware, Pampered Chef, Mary Kay Cosmetics pyramid schemes anymore? No, and you know why? Because they've been around long enough to build their reputation as solid organizations truly helping others to find financial freedom however they choose, while DIRECTLY SELLING their products through reps. Hmmmm...YTB sounds the same to me - you both are just skeptical, egotistical, and fearful that the internet will wipe out your ability to continue making a living the old fashioned way and that you will have fallen for believing a "scam". That is Ego talking at its finest instead of opening your eyes to the greatest way to market anything - scientifically known it is the greatest way - word of mouth! See a movie that's great? Tell a friend. Prefer one college class or teacher over another? Tell a friend. Love the new restaurant that just openend, or hotel? Hmmm...tell a friend. Please wake up and realize times are changing and you have to embrace change in order to make progress. Network marketing has been around for thousands of years and is only now beginning to take back some of its integrity through honest companies like YTB and others who truly want middle-class America to regain its hold and provide a financial foundation for those who choose to work it. If it wasn't for FEAR, most of the people in Network marketing businesses would succeed, but they are afraid - too afraid to talk to people, too afraid of what people will think, too afraid of not succeeding and of failing. Fear and rejection contribute to 95% of network marketers failing within their first year. Training, learning, support, patience, growth, and time will all contribute to success, but people spoon-feed people the grandiose numbers of "making big buck" quickly and then don't equip them on how to overcome the fear and rejection which are naturally part of this business. When one has that support, like YTB offers if people take it, they cannot fail if they realize it will take time. So, at least get your figures and facts correct please when you speak - for it really doesn't make what you have to say credible. Your figure of 250k reps is wrong - we currently only have a little over 135k in 7 years, so where you got that 250k is a mystery to me.
Posted: Thursday, January 31, 2008
Posted by: Jerry Marshall
I have been a YTB Rep/RTA for 2 and a half months. I haven't sold any travel stores yet, but I have had people book travel and I am currently helping someone book an all-inclusive vacation to Aruba. Am I a travel agent? No. Am I taking courses offered through YTB and associated vendors? Yes. Do I have to do that? No. An RTA is a REFERRING travel agent. I have a website where people can book their own travel and I REFER them to it and I earn commissions from that. I am not competing against traditional travel agents, I am competing with Expedia.com. If you go on a cruise and you booked it through Expedia.com and you told you friend what a great deal you got by doing that and then they went to Expedia and booked their cruise, would you make a commission from that from Expedia? NO! I am no more a travel agent than anyone else who simply goes to Expedia or Priceline or wherever to book their own travel, but I am taking steps to educate myself to become one (or get as close as I can get without the "traditional training" they go through). Does YTB force me to sell travel stores? No. Can I make money by doing that? Yes. Have I made money from people booking travel on my site? Yes. I don't see a scam here folks. What if Expedia decided to go the same route and stop spending millions of dollars on TV commercials and started recruiting reps to sell online travel stores and provided a commission from each sale to the rep? What would traditional travel agents do then? I agree with some statements that say that the traditionalists are just scared. They see the market shift and are afraid of what they see. I will make my YTB business a success. Do you know why? Because it is MY business. I can work it how I want. I can advertise how I want. If I want to sell travel stores I will. If I want to get people to book their travel on my site I will. YTB provides a way to do this. I don't see any difference in YTB and any other business that sells franchises. Its the same thing.
Posted: Wednesday, January 30, 2008
Posted by: Newyorker
I have no problem explaining. It's a pyramid scheme because eventually, you run out of people, even if you were able to open this up to the entire world. In order for this to keep working, you have to have an infinite number of investors. No matter how big and successful this thing got, you will eventually run out of people. As for why the Govt hasn't stopped in yet, that's not for me to say. With any crime, you really need someone to make an allegation of being victimized. This is not likely to happen for a long time. The appearance of credibility is also factored in by having a senior politician promoting it.
Posted: Wednesday, January 30, 2008
Posted by: John Frenaye
RTA vs TA--I totally agree about market share. But you are not really providing market share to anyone but YTB with the emphasis on recruiting and not on travel sales. As someone else pointed out 13% of revenue does not indicate that your business is in selling travel. I am a traditional agent. You know what my revenue percentage is from commissions and fees--100%. I operate completely on the proceeds from the sale and marketing of TRAVEL! Let's talk numbers. It is clear that the RTAs( travel sellers) are making literally pennies per hour. They claim to have sold $500M in travel this year. At 10% that is $50M in commissions or $373.73 per RTA.$7.18 per week. Let's take a look at the REP side and selling websites. In 2007, nearly 250K reps earned nothing. Granted, they probably did nothing so fair is fair. 45K reps earned an average of $90. Now this is beginning to be cause for alarm. Power Team Leaders (12K) earned an average of $1600 for the year. Any real income does not come until you are at a level 1 director status. 80.92% of the people that sign up do not make any money. That statistic is startling. In terms of a percentage, .003% (yes, that is point 003 percent) of all reps earn in excess of $21K per year. Someone in a previous comment said BDA has a population of 65K. That means that of the ENTIRE population only 195 would earn more than $21K in a year. ANd to earn more than $85K the percentage drops to .0005%--yes three zeros! There are now 34 people in Bermuda that can make that kind of money with YTB. What about the riches that are always hinted at? If you wanted to make $250K or more a year, your chance of doing it drops to .000135% Almost 9 people of your entire population woudl be able to do that! So where is the great deal?
Posted: Wednesday, January 30, 2008
Posted by: My 2 cents
Mr. Newyorker. You seem like an intellegent person. Please define what you belive pyramid scheme is. Also will you be honest and tell me what you do for a living either fulltime & or part time? I read the post here and the PRO seem to have valid points. If it is an illigal pyramid scheme why hasnt the GOV. shut them down? I checked the finacals and with billions done I would think the gov whould know about this right? Lastly someone said In Bermuda, this would quickly run out of steam as there are just 65,000 people here. Are they implying that people their dont know people in other parts of the world that they can talk to and exspand this outside of Bermuda? Please help me understand this so I wont make a mistake in ignorance " 1/27 Cindy Barnett. January 28, 2008 Posted by: RTA vs TA/Posted: Monday, January 28, 2008 Posted by: James Lewis/Posted: Tuesday, January 29, 2008 Posted by: Susan D.
Posted: Wednesday, January 30, 2008
Posted by: Cindy S
YTB is NOT a Get Rich Scheme! Like any other business you need to WORK to make money. I have been in YTB for 1 1/2 years on a part-time basis. In my first 3 months, I sold enough TRAVEL to pay for my original investment and then some. After personally selling 6 online stores, I no longer have the $49.95 monthly fee. I have made money selling individual/Leisure Travel as well as group trips. There is money to be made in the Travel business. When you sell travel, many times you can travel for free with the group. I have saved money, earned money and made money with YTB. Am I a millionaire? NO, but I am very happy with what I have made and most of all I am having FUN doing it! If you are expecting to get rich without working...please do not join YTB!
Posted: Tuesday, January 29, 2008
Posted by: Newyorker
This is a classic pyramid scheme. The pro comments are understandable, being that they are from people who appear to have a vested interest in the continuation of the scheme. I truly believe that they genuinely think it's an honorable business. Like all pyramid schemes, it will come to an abrupt end. People will then fall into two camps. One side will say good riddance. The other side will say that this wonderful business was brought down by scaremongering, or the usual favorite .. a certain section of society doesn't want to see a certain other section get ahead. |
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