In this regular column, Adrian Caruso, founder and CEO of TA Fastrack Australia, dishes out advice to travel experts. A former travel agency and hotel owner/operator, Caruso now coaches travel, tourism and hospitality businesses throughout the region.
Do you remember the good old days when airline commissions generated the bulk of your travel agency revenues?
Well times have changed with the agency community now changing its focus to increasingly complex, high-margin products such as cruises and holiday packages. This type of travel holds far more financial opportunity than air ever did back in the seemingly untroubled days of airline commissions and overrides.
This is an area in which travel consultants have a big advantage over online travel agents (OTAs). Travel experts know their clients. They see them at football games, churches and grocery stores, and have personal relationships with them that many online players don’t have.
But OTAs do have one advantage: A single database that aggregates the purchasing and travel history of all their clients. All their automation is in place. They automatically have every client’s e-mail address. They can easily go back and pull up travellers who have booked a trip but who may not have purchased travel insurance, car hire or day tours.
Now that’s what I call the ‘one database benefit’. Being able to look at a single database, analyse its purchasing power, segment that database to see what kind of products will appeal to the various types of customers in that database and design customised campaigns that will appeal to those clients.
Why do travel consultants fail in marketing? The first reason is that they simply don’t communicate with their previous clients. Our research shows that one in five travel consultants make no contact with their clients during the year and a further 45 per cent contact them only once over a 12-month period.
Even travel consultants that market don’t know enough about their customers to sell them a product that would appeal to them. They just market anything to everyone on the database – mass. Your customer database is your most valuable asset for it has no stock. It is not just a list of clients. Which brings me to the second reason why agencies are failing in marketing.
I feel it is at times the fault of the major GDSs and the back and mid-office systems they have been selling agencies for years as a bolt-on. These systems simply do not do enough with the client data that is captured by travel consultants. If they do, they have not shown travel consultants how to extract the information and what to do with it.
You as a travel agency have total ownership over databases because it’s your programme and you choose the suppliers, you choose which clients get what and you are in control. You are just outsourcing.
This is the future of marketing in the travel industry – targeted and niche marketing based on a client’s interests.
But for this to happen travel consultants have to take a good hard look at their existing mid-office system and see if it is giving them all the information they want about their customers, including purchasing history, preferences and interests.
This usually involves having a customer relationship management (CRM) programme within their mid-office system or as a bolt-on. Travel experts must then learn how to use this valuable CRM programme and decide to embark on more targeted marketing to their database of customers on a more frequent basis.
Otherwise others will, and they will profit – not you.