From knowing whether or not to charge fees to understanding the rapidly growing giant that is the multigenerational client, Travel Agent arms you with all the knowledge you need to make sure 2013 is a profitable year.
As we do every year, Travel Agent spoke to some of the industry’s leading agents, operators and other travel professionals to find out how to make more money in 2013 and beyond.
Charging Fees
It’s hard to believe that just a few years ago charging fees was considered taboo. Now, after covering our third annual Young Leaders Conference, which brings together agents and suppliers under the age of 40, it’s apparent that most agents scratching the travel industry service opt to charge fees to clients. And the ones who don’t are strongly considering making a change.
This was a far cry from the post 9/11 days and the post 2009 economic turndown days where fees would have mad a consumer run to the Internet the second the subject was raised.
But after two years filled with natural disasters from ash clouds to hurricanes and political unrest from airport strikes to riots in the streets, consumers are once again craving the human touch of an agent. Subsequently, many clients, especially those who have spent hours being overwhelmed by both legit and bogus travel offerings online, are realizing that the value of an agent far exceeds the nominal fee they are charged when they walk through the door.
“I believe in fees,” says Jill Taylor, an advisor with Jetset World Travel. “The first year that my company started charging fees we made over $100,000 in fees alone. We believe we are charging for our knowledge and our expertise.”
There are, however, still plenty of agents, such as Stacy Small of Elite Travel, who do not charge fees. Small does, however, charge a 10 percent cancellation fee.
“My client base is around 27 and 28 years old. They are Silicon Valley rockstars who know the Internet. If I charged them a fee, they are capable of booking travel on their own,” she says. “My clients spend an average of $30,000 per trip when they book with me, so all I ask is for referrals to their friends.”
Perhaps the biggest issue surrounding fees, especially for new agents, revolves around new clients. Many agents we spoke to who didn’t charge fees reported several incidences where clients would use the information they gained from the agent during the qualifying process and then use that knowledge to book online, bypassing the agent. Agents who don’t want to charge fees full time, but are worried about being burned by such clients should perhaps charge a fee for first-time clients. If the client is legit and books through the agent, then the agent can always waive the fee the next time the client books a trip. Another alternative that we learned from chatting with agents was to require a deposit. The deposit will then be used toward the overall principal of the client’s trip. But if the client decides to go elsewhere, the agent can at least keep the deposit, preventing someone from stealing an agent’s expertise only to book online or with someone else.
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| John Stachnik of Mayflower Tours warns agents not to be too dependent on social media. |
Marketing
For years the Internet has been seen as the “enemy” for the travel professional, but according to Chelle Honiker-Yarbrough of The Travel Institute agents still need to learn how to harness the Internet to make it work in their favor. “We used to just have demographic advertising through mail marketing,” she notes. “Those days are over. Now you as an agent have access to demographic information that’s far beyond what you can expect.” Now there are ways for agents to find, for example, brides that have been engaged less than six months within a 50-mile radius who like Grey’s Anatomy and have been to Puerto Vallarta twice. “You can find those people and advertise to them cheaper than you ever dreamed possible,” says Honiker-Yarbrough.
Agents need to create a plan for each endeavor, and having a niche has been a common theme at the conference so far. “You can target people and find business to do with anyone, anywhere. That’s the beauty of the Internet,” she says.
From a strategy perspective, Honiker-Yarbrough believes that it is important to do two things. The first is to make sure that your points of differentiation are well defined. “You need to know who you are and what you sell,” she explains. The second is that you need to tell people about it. “What’s important now is utilizing online technology to help you do that faster and smarter and more intuitively.”
Social media is still extremely relevant, but it is important to stick to the goal of not getting “sucked into the vortex.”
“Facebook is the most relevant marketing tool on the planet right now,” she stresses. Honiker-Yarbrough, who spoke at the inaugural Luxury Travel Exchange (LTX), asked the audience that sat in on her panel who in the room has a Facebook page, and almost the entire room raised its hands. However, when asked who knows what they are doing on Facebook, the number of raised hands dropped significantly.
“Everyone should use their personal Facebook page to market their business, but they have to do it smartly,” she says. One of the best ways to market on Facebook nowadays is to create a Facebook ad, which allows people to target their sales to a very specific demographic. “Facebook aggregates peoples’ ‘likes’ and keeps it fresh,” she says. This means that if as an agent you want to sell a Jazz Cruise, you can create an ad that targets fans of Harry Connick, Jr., or fans of the New Orleans Jazz Festival. “Facebook ads are repetitious and people are starting to click through to be directed to your page.” To create a Facebook ad visit www.facebook.com/ads.
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| Jana Lavell of MLT Vacations offers tips for selling in 2013. |
Twitter is still another great way to grow business, but it is one that you have to be devoted to. If agents aren’t that into Twitter, it won’t be a loss for their business, but if someone has really embraced the medium, it can be incredibly beneficial. “There are powerful ways to use it. It’s good at asking questions. It’s good at letting you learn. Twitter is instantaneous and it’s excellent for letting your personality show through,” she asserts. If someone on Twitter is complaining about a particular cruise or travel experience, an agent can swoop in and fix it. What better way to gain a client for life than by helping them figure out a sticky situation?
“The most important thing to remember is to think about your objective. Your objective should be a better action—something that will give you ROI. Decide what gameboard you want to play on and then spend your time devoting to it,” she suggests.
While social media continues to be a marketing tool that doesn’t seem to be going anywhere anytime soon, many industry professionals urge agents not to become too dependent on it.
During the recent United States Tour Operators Association (USTOA) Annual Conference & Marketplace, Travel Agent sat in on the USTOA’s State of the Industry panel discussion in which John Stachnik of Mayflower Tours stressed the importance of using it to network with people other than customers and also warned agents not to become “a slave” of it.
“Too many people becoming a slave to social media,” Stachnik says. “There is nothing like getting in room and talking to people one-on-one.”
Besides one-on-one meetings, other suggestions we’ve heard from agents include such “old-school” marketing tactics as direct mail, establishing a relationship with local media and also using other websites besides Facebook and Twitter, such as Yelp.
As far as establishing a good rapport with local media, we suggest contacting local newspapers or industry magazines such as this one, finding out who covers the region the agent sells and setting up some kind of an appointment, whether it’s via e-mail, on the phone or in person.
Writers reporting on destinations crave the expertise from specialists in the area the author is writing about. If you are a Hawaii expert, find out who writes about Hawaii and send that person your background info and a little about what your agency sells. The next time that same author covers a Hawaii story and needs insight from an agent, guess who will be the first person to come to mind.
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| Julie Zadeh of the Hawaii Visitors and Convention Bureau doesn’t think multigenerational travel will slow down any time soon. |
Another effective way of marketing, while also establishing your own credibility, is blogging. During the recent LTX in Las Vegas, Travel Agent sat in on a panel hosted by veteran blogger JoAnna Haugen, who writes for the blog site, Kaleidoscopic Wandering, and also serves as a managing editor for several other blog sites, and learned of some tips when using blogging as marketing tool.
Haugen told the agents in the room that one of the most important activities they should be doing is blogging consistently. She recommends not blogging every day, but perhaps about three times a week.
“There was a time where people used it as a personal diary, as a personal journal, but it’s important that companies and people running companies have blogs,” she recommends. “People are online and they are looking for you and in order to find you they need to find something by which to find you. Your blogs are constantly being crawled by Google and when Google finds new content, it bumps you up in the rankings.”
Other tips she suggested included using the blog platform Wordpress over other blog platforms simply because, “there are a lot of plug-ins in Wordpress that are created to make it easier for people to navigate your sites.”
Haugen also heavily stressed staying on top of Google Analytics because it breaks down exactly how many people are reading your blog, who is reading your blog, etc.
Also, be sure to keep the comments feature on and try to respond to as many as possible. Keep a flowing dialogue going. Then you can always use those comments for a separate, follow-up blog.
“Blogging is a two-way street,” she implies. “Blogging is about two-way communication. Listen to what people have to say. Take advantage of what people have to say. You will be able to reach those audiences you want to reach in order to market your own products and services.”
Other keys to a successful blog, Haugen says, are keeping the content consistent, perhaps organizing an editorial calendar for a few months in advance; don’t push your product too much, but make it available and easy to find; integrate your blog into social media, such as Facebook, Twitter and Pinterest; consider key words and think about what people are searching for as far as SEO (search engine optimization) goes and, above all else, “keep your content readable, relevant and enjoyable.”
Client Trends
Last year, it was all about experiential travel, tours geared toward some intimate cultural experience within the destination clients are visiting.
This year, multigenerational travel has taken the prize for the hottest client trend.
According to Jana Lavell, regional sales manager for MLT Vacations, her company has been doing an enormous amount of multigenerational travel over the last three years or so, a trend that she says really began to blossom once people started traveling again following the 2009 economic downturn.
“I think when people began traveling again, they were kind of looking for a security blanket, they really wanted to travel in packs,” she says. “And that’s how this multigenerational market to Hawaii really grew.”
Julie Zadeh, managing director, travel trade marketing for the Hawaii Visitors and Convention Bureau, told us she believes it’s the sons and daughters of baby boomers who are driving this trend.
“Several years ago the multigenerational market really started to build,” notes Zadeh. “I think it has a lot to do with the fact that baby boomers are now becoming grandparents. And that has really helped our condominium business, which has always been very big here.”
As part of a summit Travel Agent hosted on multigenerational travel at the Trump International Hotel & Tower Chicago earlier this year, we found that 77 percent of multi-gen travelers had been planning, and/or were planning, a vacation around a milestone event like a birthday, a reunion or a wedding. Some driving factors behind multigenerational travel include extended families living geographically farther apart; the fast pace of life in the 21st century means evenings and weekends are no longer untouchable family time; and baby boomers are trading in their briefcases for a roller bag.
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| Anne Morgan-Scully urges agents to make the most of their time. |
“Gen Y customers spend a lot of money on travel,” claims Stacey Orlando. “They didn’t make the bad investments that some of us in this room made. And they are staying longer than the [baby] boomers.”
At LTX, luxury travel advisors and suppliers heard from Peter Yesawich of MMGY Global, who gave a profile of the affluent American traveler and what he or she took from 2012.
The survey that MMGY Global conducted examined those with an annual household income of more than $250,000, or the top 2 percent.
Among the trends discovered, Yesawich explained that 32 percent of this bracket planned to take more leisure trips in 2013 versus 2012. Sixty-one percent would take the same amount of leisure trips, and just 5 percent decided to take fewer trips.
So where are the affluent travelers going? According to the study, 68 percent of people have Western Europe on the brain. The Caribbean and Oceania were tied at 51 percent. Thirty-eight percent of this bracket wishes to see Canada, while Eastern Europe has the interest of 36 percent. Thirty-five percent have their sights set on Asia, and 33 percent are interested in South America.
Domestically, Hawaii’s neighbor islands took the bulk of the interest at 73 percent. Sixty-three percent want to see New York, and 62 percent are interested in Honolulu. Percentages hover in the mid-50s for the Florida Keys; Washington, D.C.; San Francisco; Napa Valley; New Orleans; and Charleston.
Last year was the year of celebratory travel, and that trend seems likely to continue through 2013. Last year, 61 percent of those surveyed took a trip for a milestone birthday. Fifty-six percent traveled for an anniversary. Other celebratory travel included weddings, family reunions, graduations, honeymoons and class reunions.
Multigenerational travel continues to be huge in the market. Twenty-four percent of those surveyed were grandparents, and of those 41 percent traveled with their grandchildren on one or more leisure trips during the past 12 months. The majority of those trips included the parents of the grandchildren.
The affluent traveler is tired of waiting. During the economic downturn, travel took quite a hit, and those that are used to hitting the road are itching to come back. Thirty-five percent of those surveyed took a “last minute” trip during the past 12 months. The average days in advance of arrival was six. This is a great way for travel agents to make a few extra dollars. Sell that last-minute trip. Make your clients realize why now is the time to go. Seizing the day is a concept that will never grow old.
In terms of travel agents, 30 percent of those surveyed plan to use traditional agents in 2013. Sixty-eight percent say that an agent influences their choice of lodging, and 58 percent say that their agent influenced their choice of destination. What you say affects what you sell.
Selling Luxury
As part of our coverage of LTX, Travel Agent sat in on a seminar hosted by Anne Morgan-Scully, president of McCabe World Travel, and learned such insider tips as cutting loose clients who “suck up your time,” learning about clients’ bucket lists and more.
But perhaps the biggest piece of advice Scully shared during her presentation was to engage your client. Do not just be an “order taker,” she advises. Rather, get to know your clients. Learn about what they love to do and learn about their family’s passions as well.
“Say this to them: ‘I am concerned that your time is so important and I’m not sure I can give you what you need unless I get to know you,’ ” Scully says, “Say, ‘I can give you so much more if I know you. When can we get together and talk? Or perhaps I can sit down and talk with your wife. ’ ”
Morgan shared a story about booking a man to London. She learned about the client’s family. She learned that the son loved sail boats and the daughter loved riding horses. She arranged to have the daughter see Winston Churchill’s private horse gardens and set up a sailing trip for the son that took him under the Tower Bridge.
“He is now a client for life,” she claims, “because he had no idea he was able to do any of that.”
Scully also shared a story about a man whose dream was to go to New Zealand and Australia, but didn’t think he could afford it and wanted to wait a few years before he took the trip. She then explained to him that this was the best time to go to take advantage of the economic downturn.
“I told him now is the time,” she says. “This is where you can get a two-for-one cruise, free airfare, etc. When the economy gets stronger, you won’t get this value anymore.”
He wound up buying a 30-day cruise to Australia and New Zealand and got to take his dream vacation.
“If you open the conversation up, you will be surprised,” she says. “He didn’t know he could have that. That’s our knowledge base. That’s what you should be providing to clients.”
According to Scully, advisors, like most people, tend to focus on what they did right. For example, Scully says, you’ll hear people telling you about all the money they won in Las Vegas, but will you ever hear them talk about the time it took or how much money they lost before they won? The same goes with your clients. Do you ever focus on the clients you lost?
“Who did you have in 2011 that booked with you that you didn’t have this year?,” Scully asks. “Did you even know they left you? Who do you have this year that you won’t have next year? How many of you look at those numbers? Hardly any hands went up and I think because that’s not in our DNA. We are business people first and we need to hold our business and development relationships. We need to have a business plan per client. Who are they? I want you to look at who are you losing and who you are not holding onto. Where did they go? I want you to open your mind to new possibilities, a new way of thinking.”
Scully stressed the importance of making sure your client isn’t wasting your time. There is no shame, she says, in cutting off clients that are wasting your time or as she puts it, “sucking the life out of you.”
“You can’t afford people who are sucking up your time,” she says. “Get rid of them because they won’t change, but you can change. You can say, ‘I can’t work with you anymore.’ You have to be a leader in the dance you are having with your clients. It needs to work on both levels.”