We asked leading suppliers and agents how they were coping with the economic recession. Here is their advice for the new year...
Taking Advantage of the Downturn
While an economic downturn is never good for business, it can provide agents and suppliers with time to reevaluate their strategies. Ignacio Maza, executive vice president of Signature Travel Network, sees the recession as a time to operate smarter. “Look at every single department, every single process, and figure out how to make it as efficient as possible,” he suggests. “Renegotiate with landlords, contractors and outside vendors for the best terms possible for the next 12 to 18 months. Explore new revenue-generating opportunities that will make a positive difference in your business. Pursue partnerships and alliances that can bring in new sales.”
Another tip from Maza: “Reach out to your customers, remind them of the value and the expertise you bring, and convey a message that the travel values offered today are unprecedented. Communicate with your staff to ensure everyone is contributing 110 percent, especially now.”
Michael Schrobat of Culinary Expeditions Tour Company notes that the current recession has given his company “a much-needed time to organize, plan our 2009 goals and take a hard look at our business model. We have made some changes, cut some expenses that we missed, like changing our banking, credit-card processor and reducing unneeded costs associated with websites, extra domain names, phone lines—looking at cost cutting we should have done long ago. We are also meeting with our local hotels, doing site inspections, ship inspections, when available, and attending our convention bureau activities to increase our visibility.”
Julia Aliseo, a travel agent at Cruise Planners, is taking a proactive approach to this downtime. “I am not waiting for clients to call,” she says. “I am utilizing my client profiles and making calls with many of the fabulous offers out there today that will help them to look forward to a vacation next year, asking for a deposit now with final payment due in the future, with time to budget.”
“I am concentrating on keeping in touch with past clients and keeping the relationship on track,” says Sherry Laskin-Kennedy, owner of The Vacation Shoppe. “The holiday season is a really great time to have a reason to call your clients. Send greeting cards, birthday cards or anniversary cards.”
David Speakman, chairman, Travel Counsellors
In a similar vein, host agency Travel Counsellors’ Chairman David Speakman encourages his agents to relate to their customers. “Create a social contract with the customer, not just a transaction,” Speakman says. “You create an emotional attachment with the customer, and that is the advantage.”
Greg DeClemente, general manager and COO of Courtyard Travel, is finding it’s a good time to add on new travel advisors. “The downturn has presented an opportunity for us, as it pertains to independent agents,” he says. “Many are contemplating a move to a more stable and dynamic environment. Keeping this strategy in mind, we’ve welcomed four new independent contractors to our company, each with a unique book of business.”
Laskin-Kennedy says that a slow time is “fabulous for finishing all the educational programs started earlier in the year.” She suggests that agents “complete a CLIA level online,” or focus on any of the “in-depth programs that take time and effort to complete.”
John Burgess, manager of the leisure travel division at Preferred Travel of Naples Inc., suggests that agents use their free time to go on fam trips, so they can relay that enthusiasm to clients.
Along these lines, Marc Kazlauskas, president of tour operator Insight Vacations, says that his company is taking advantage of agents’ appetite for training and education. “We have our sales managers blitzing targeted areas and using the time to train on Insight and how to sell escorted tours in general.” He’s also educating his own staff. “We currently have a different tourist board coming in twice a week to train our reservations staff, and sales and technology training for our sales managers and execs.”
Similarly, DeClemente says that Courtyard is “inviting more suppliers to host training sessions in our office and encouraging our independent agents to take advantage of fam trips being offered by preferred suppliers.”
Cruise Planners’ Aliseo is taking various cruise line courses and familiarizing herself with new products. “I also take time to research and visit different resort websites for special offers,” she says.
New York-based Tour de Forks is learning about up-and-coming destinations, vice president Lisa Goldman says. “Our president is just back from Turkey and our vice president of business development traveled to Argentina in November. Both are destinations where the U.S. dollar is stronger and will have more appeal in this current economic climate.”
“A downturn may, in fact, be the most opportune time to enhance one’s skills,” notes Guy Young, president of Uniworld River Cruises. “Managers and employees are often so stretched during growth years that it is difficult to allocate time for education and self-improvement. At Uniworld, we have a tuition reimbursement program, and this may be the best time for our employees to take advantage of this opportunity.”
Sherry Laskin Kennedy of The Vacation Shoppe with "Lobster Dave" at Fisherman's Point in Ocho Rios
Pull Ahead Now
While many companies are going into hibernation during these tough times, the smart businesses are using the time to gain a competitive edge. “I’m using this downtime to keep ahead of the pack,” says Laskin-Kennedy. “Many of the educational programs offer travel benefits and fams once completed. Experiencing the product or destination is the best way to impress your clients and to gain their confidence…You have to be the most knowledgeable and experienced travel agent that they could find.”
Adds Insight Vacations’ Kazlauskas, “We have a full staff of 12 sales managers on the road making a minimum of six to eight calls per day, visiting agents and doing everything they can to help agents drive business—this while many of our competitors are encouraging their sales staff to cut back on travel.”
“In a downturn, we obviously have to focus on becoming more efficient and cutting out operational slack that might have built up during growth years,” says Uniworld’s Young. “But as we see some of our competitors take a very short-term approach to the downturn, with significant layoffs and price discounting, we are trying to be more strategic and are focusing on the long-term success of the company. We continue to invest in our product and we continue to engage in marketing opportunities with our trade partners.” Recently, he adds, “we agreed to a financial investment with one of our retail travel agency partners to support their development of a long-term e-commerce strategy, and we don’t expect to see results from this initiative for a couple of years.”
With tighter budgets, marketing becomes a greater challenge for agents and suppliers. But, as Laskin-Kennedy points out, “Now is not the time to conserve your marketing dollars. This is the time to negotiate with your local advertisers or join forces with another venue (restaurant, wine store, health club, etc.) and get your name out there,” she says. “People are still looking to travel; they just want to think that they are getting a bargain deal—not necessarily the best value. Invest the most dollars you have available into advertising now, before the storefront down the street beats you to it. This is the most important time to stay current and in your clients’ face.”
“Repeat business is available to all agents,” notes Aliseo. “All you need to do is ask for the business. Besides calling my clients, I use our weekly e-mail flyers that are sent to clients in my database and ask that they share these promotional offers with family and friends, even if they are not ready to plan a vacation.”
Likewise, Annette Gordon of Rubinsohn Travel keeps in touch with past clients to let them know about specific destinations. In doing so, she says, “I am letting them know our agency is active and watching all promotions that may be of interest to them.”
Billy B. Martin, co-owner, Let's Travel Together
“We’re going to target across the board instead of just the luxury client,” says Billy B. Martin of Let’s Travel Together. Martin will also prepare an electronic marketing blast of 1,200 e-mails by gathering up e-mails from up to three years ago as a way to reapproach clients he may have lost touch with.
Signature’s Maza suggests that agents change the “voice” of their marketing to be mindful of the current situation, yet persistent in the message that travel is a key priority for living well. “Convey the message that travel delivers experiences, memories and joys that no material thing can deliver,” he suggests.
Michael Rotondo, director of travel for AAA Travel New York, recommends sticking with tried-and-true during a downturn. “This is not the year for us to try new destinations or vendors,” he says. “We will stick with what we know best and what our members want.”
From the supplier perspective, Kazlauskas says, “We continue to keep spending on smart marketing and sales staff—we stay in the agent’s face and help them drive business in the door.”
At Culinary Expeditions, Schrobat says, “Remember to market yourself, not the products you’re representing—clients want security, advice, wisdom with solid guidance, and only you can do this!”
Brooke Castor of Down Under Answers
Tour operator Down Under Answers decided to expand its offerings, adding Dubai to the list. “We’re offering Dubai for the first time as the way to capture a new audience,” says Brooke Castor, national accounts manager. The company is also using the downturn to reach out to travel agents. “We’re doing this through our webinar series, but we’re also traveling for in-house visits with agencies,” Castor says.
Connie Walsh, vice president of business development at Tour de Forks, says her company is working to educate agents about developing culinary travel as a niche. “We have recently collaborated with The Travel Institute by doing a webinar for their members, and we participated on a panel on culinary tourism at their conference. Many agents today realize that they need to develop a niche, and culinary tourism is one of today’s hottest travel trends. There are a lot of deals out there, but we don’t want to get caught up in that. We want to continue to focus on the value and the experience.”
For Trafalgar Tours’ President Paul Wiseman, marketing is about focusing on two key variables: “Working with our key travel agency partners who are looking for powerful, mutually beneficial relationships, and return on investment. This takes two forms—immediate and long-term opportunity.”
“In a tough year,” says Uniworld’s Young, “it is imperative that we are in constant contact with our trade partners. We need to be in front of our travel agents, communicating the value of river cruising, which, as an all-inclusive product, is a very relevant option in today’s tough economic climate.”
How to Stand Out
In a difficult environment, it’s more important than ever to make sure your message is getting through. “Repeat and referral business will get you through to customers who have stacks and stacks of travel agency postcards piling up at their home and in their online mailbox,” says Laskin-Kennedy. “Ask for the business. Give a referral reward to past clients either in the form of cash now, or dollars off their next vacation.”
She acknowledges that it isn’t easy to grab clients’ attention these days, but the effort can pay off. “I’m investing in print ads right now that are eye-catching,” she says. “My ads focus on a particularly unique cruise or tour that is priced for these tough economic times. Then, once they call me and want to book, I can try to upsell them to a better cabin, a pre/post-cruise or tour stay, or even a better travel insurance program.”
Many agents opt for the personal touch in reaching out to clients. “A personal note is added to our offers,” says Aliseo, while DeClemente notes that “with our base of upscale leisure business, our contact with clients must be frequent and personal, by phone, handwritten notes or face-to-face visits. Our message is that there are a ton of deals out there, and the only one who can cut through the clutter is us.”
John Issa, executive chairman, SuperClubs
“Consumers today are extremely savvy,” says Trafalgar’s Wiseman. “If a supplier is cutting prices, they are hurting themselves because clients will then wait to see when they will get the best price.” Wiseman suggests instead that a supplier should explain its value and quality proposition from the outset.
“There are many offers out there, but the key to achieving a true value vacation is no hidden costs,” concurs John Issa, chairman and founder of SuperClubs. “The one-price-buys-all model is a smart, value-driven choice that offers a distinct advantage: It eliminates most, if not all of the financial risk and surprise from a vacation.”
To stand out amidst the clutter of e-mail deals available, Burgess from Preferred Travel says, “Keep it short and to the point and use the best graphics and photos you can find. People respond well to great visuals, and will read and retain a well-written, concise piece.”
Keeping Morale Up
With all the negative news, keeping a positive outlook within your company is crucial. Courtyard Travel’s DeClemente says his team remains upbeat with humor, one-on-one sitdowns and staff meetings, keeping all employees in the loop.
“Management must maintain a positive and upbeat manner,” he says. “Otherwise, employees reflect what they see and hear right to our clients—and that’s a big no-no.”
Marianne Braly of Now Voyager Travel likens an agency’s owner to the captain of a ship, responsible for setting an example for the crew. “This is merely another ‘bump’ in the road,” she says of the downturn.
Aliseo gives her associate agents ideas that they can use to attract new business and make sure they utilize the opportunities that are out there. “I advise my agents to write their goals,” she says, “as this can be the morale booster one needs to stay excited about their future in this business. If you do not have a written plan, the future of any business is in jeopardy.”
Staff communication is key during these times, emphasized all the travel agents and suppliers with whom we spoke.
“Sharing strategic information, including how the company plans to weather a downturn in business, creates a much better sense of ‘ownership’ and commitment from employees at all levels of the organization,” says Uniworld’s Young. “You also have to be honest with employees. Do not deliver false optimism and never give promises that you can’t deliver on.”
It is equally important to remember that clients still want to travel. “Despite the problems at home—or maybe because of the problems—people want to find some escape,” says SuperClubs’ Issa.
Gordon of Rubinsohn Travel agrees, noting that the industry survived the 1987 recession, too. “People still want to travel,” she says. “Many do not consider travel to be a luxury. It is their lifestyle and they do not wish to alter that one bit.”
—Michael Browne, George Dooley, David Eisen, Mackenzie Allison, Joe Pike, Roberta Roberti, Mark Rogers, Ruthanne Terrero and Jena Tesse Fox