Earlier last week there was a not so eloquently worded comment to one of our columns that indicated that the commenter’s agency’s business was down 30% already this year. To be honest, I am sure he is not alone. To be even more honest, I bet most people are not brave enough to admit that. While that commenter is not alone, neither is the travel industry. Let’s look at retail and see if we can draw some conclusions.
Last week, I was out at the local mall—browsing, not shopping (my business is down as well). After hearing all the news of the “better than expected” January, I could not help but notice the terrific sales. I remember a day when Macy’s would offer 25% off and it was a big sale. But in 2009, those signs are reading 60%, 70% and even 80% off. This is unprecedented in my lifetime and I am afraid that this is the new normal.
Retailers are in a better position that the travel industry because there is a huge chasm for middlemen. Clothing typically retails for hundreds of percents above cost. Many products derive their cost from the label attached to the collar. What’s the difference between a Ralph Lauren Polo shirt and a Hunt Club one from JC Penney? Besides about $70, the only real difference is the label. And again, the travel industry (for the most part) does not have the luxury of designer labels to increase margin.
So what are these stores doing? They are quite simply dangling a carrot in front of the consumer hoping to lure them in. Call it what you will—fishing, trolling, chumming, teasing, or just plain effective marketing. Are you doing it?
Without the label or the extraordinary mark up, we may be down, but we are certainly not out. Every industry poll or survey suggests that our customers want to travel. But, can they afford to travel? Do they feel confident in spending the money to travel? For many, the answer is a resounding “no”. Face it, they are going to sit home and watch Blockbuster movies and grab a large pizza trip with a Papa John’s coupon. See, I have always contended that Blockbuster and Home Depot were our largest competitors! But, people will get the itch and the wherewithal to travel again. It may take some time to rebuild their confidence, but it will come. Does anyone remember 2002? Your job is to make sure that your customers know where to go when that confidence returns.
Go fishing. Just as you need to make yourself relevant to your suppliers, you need to make yourself relevant to your clients. Chum, troll, fish, and tease! Empathize with them—you are likely in the same situation. Scale down your expectations—while they may not be able to take that Regent Seven Seas cruise this year, they may be able to take a shorter one on Royal Caribbean or Carnival. Offer them choices. One element that will be critical to your business is to keep in touch with them from several angles. Pick up the phone for your best clients, make sure you are sending out newsletters by email (use a service like AWeber for best results), mail brochures to those you feel may be interested, and start a blog for your agency. Blogs are a great way to interact with your clients and potential clients. Don’t make it all pitchy and sales related, but keep it informative. Give them a reason to visit you without spending money and you likely will have given them a reason to visit you when they are able to spend money.
Here are some low to no cost ideas:
- Develop and update a blog
- Send them an electronic newsletter at least monthly, focus on info
- Host an open house with coffee and donuts
- Offer to speak at the local Barnes and Noble or Borders
- Send them a special “insiders” report on the industry
- Send them some dreams (brochures) for when they are ready to travel
- Pass along some terrific travel bargains that are targeted to their preferences
- Offer consumer tips. Frauds and scams are proliferating, tell them how to avoid them
It works! Here is a real life example. I specialize in single parent travel. Each year we go to the Caribbean for a week in August and we have 40 to 60 families participate. This year my bookings were way off. Typically, I have 20 bookings under deposit by this time. This year it was six! I called the resort and discovered they were in the same situation. And because I was relevant to their success for the past 8 years, I was able to negotiate a new rate that was 50% lower. So, I sent out an email with the new terrific pricing. Now, the family that was hesitant at $2400 was a serious contender at $1250. I explained that the resort could rescind it at any time and reminded them of our liberal cancellation policy. In two days, I had an additional 19 bookings. Granted, the commission earned will be less, but more than the commission, I have proved my relevancy to both the client and to the supplier. I am looking out for them both as well as myself–everyone wins!
Get out there (I can say that, Royal Caribbean is no longer using it) and fish a little. If you are concerned that your business is down, you are not alone; but you alone are responsible to get it back to acceptable levels. Complaining about it accomplishes nothing. Involve your clients and they will reward you!