I have now completed my 40th year in travel marketing…much of it within the tour operation side of the business, and for the last 6 years with my own travel marketing company. I’d like to share some points on getting the best results possible from a marketing budget in today’s sometimes confusing marketing world
The Budget Allocation. This is the first step. For most travel companies (and I am referring to travel suppliers to the industry such as tour operators) (Ed Note – the same rule is applicable to travel agencies.) the rule of thumb for determining the amount of the budget has always been 1-3% of projected sales. Thus, for example, if a company projects doing $300,000 in sales, then the budget would range from $3,000-$9,000 which would include advertising, printing, trade activity, etc.
The Marketing Plan. The next step is to create a marketing plan that presents in detail how the marketing money is going to be spent over the designated period of time: usually a year, but sometimes based on selling seasons. In the tour operation business, the marketing budget frequently reflects seasonal trends. For example, a tour operator that sells products to Europe will spend larger amounts of the budget in February, March, and April during a typical year.
The Budget is Dynamic. Clearly, the budget is subject to ongoing revision and reworking based on sales and changes which are inevitable…and frequent. So, view the budget as a roadmap, and one that can be revised and rethought as needed.
The Marketing Elements. Today the world of marketing revolves to a great extent around electronic media which involves advertising directly on travel and other websites, and through exclusive emails and shared newsletters. More recently, networks (also called web suites) have emerged that allow the advertising message to be broadly spread to a substantial number of appropriate websites. As is commonly known, consumer print media is in decline except for some notable niche exceptions. Finally, there is both print and electronic media to be considered and used with the trade. Many of these sources are thriving (one example being TRO).
Test, Test, Test. Today, there are literally hundreds of media sources and more emerge every day. Thus it is extremely important to test, test and test some more. Since the budget is dynamic, testing will allow the advertiser to determine what works well and what doesn’t. For those sources that work well, put more money in and reduce or eliminate those that don’t. One of the great advantages of online is the speed and flexibility that they offer.
Track, Track, Track. It is imperative that response from all advertising be scrupulously tracked and recorded. Put into proper context, you will be able to see the results of every campaign, and then easily be able to compare sources.
Conversion. In order to figure out your return on investment (ROI) you have to know how each individual media buy ultimately performs. The ability to do this varies widely in the travel industry and, for many, is the “weakest” part of the marketing effort. For those that learn how to do this better, the marketing and advertising payoff will be dramatically better.
If you follow the above steps, I think you will find you will get better results for your advertising dollar.
Doran Jacobs is the President of Mighty Marketing, a Manhattan marketing company specializing in the travel industry.