After all the criticism, controversy and litigation surrounding the company and its multi-level marketing travel model, it seems amazing that YTB International is still around. But while smaller and financially struggling, the company still expects about 5,000 people to attend its annual national convention in St. Louis later this month. An estimated 8,000 people attended last year’s gathering.
The Illinois-based marketer of travel agent websites, now led by CEO and President Robert Van Patten, has restructured its management team and trimmed overhead and expenses in response to continuing losses.
YTB lost $423,000 for its first quarter ended March 31, compared with a loss of $1.9 million a year earlier. Total revenue for the quarter ended March 31 was $9.3 million, less than half of the $21.4 million reported in the prior-year period.
J. Scott Tomer became the company’s chairman last fall after his father, founder J. Lloyd “Coach” Tomer, resigned.
YTB has suffered from cutbacks in travel and commissions during the recession. It has also spent a great deal of time defending itself against charges it operates as a pyramid scheme.
In May 2009, YTB International Inc. agreed to pay $1 million and to stop charging so-called agents for its travel websites in order to settle a deceptive marketing lawsuit filed by the California attorney general. The company also faces another lawsuit from Illinois Attorney General Lisa Madigan, who alleges that YTB violated state laws regarding unfair competition and advertising.
YTB has attempted to penetrate the Canadian market, with little apparent success. The YTB Canada – Toronto Group Facebook page reports just 53 members, and its most recent ‘News’ posting is the press release announcing the launch of YTB Canada on February 16, 2008. The Facebook page also lists YTB’s ‘mission’ as ‘To be the largest travel agency by the end of 2009.’
The YTB International convention is scheduled for Aug. 17-21 at St. Louis’s America’s Center and the Renaissance Grand Hotel.
