Your travel company is as vulnerable as it’s rudest consumer facing staff member.

Despite the hundreds/thousands/tens of thousands/hundreds of thousands/millions you spend on advertising, your company is as vulnerable as the first person I speak with. That $8.00 an hour, or $12.00 an hour, or $6.00 individual is who I talk to when I call up, what I’ll tweet about in good times and in bad, and what will largely determine whether I use your travel agency again. Day to day customer satisfaction is tied to your people, not your brand. That’s a mentality and a practice that we need to embrace.

The same theory applies to the first person I see when I visit your office. Is she nice? Is she happy to see me? Is she juggling 5 phone calls, irritated, stressed and ready to bite my head off? Guess what, now she’s not the only irritated one. My bank spends millions a year on TV advertising but it’s the teller, the branch manager and the person greeting me that gives me the “I’m not just my account number” feel inside (yes I said something nice about my bank..)

I was watching a documentary on Zappos.com the other day and realized more travel companies need to mimic what they do. They can help train your company (for a fee) if you’re interested.

A large part of the happiness Zappos customers feel is directly tied to the happiness of their telephone agents. Agents who are empowered to take care of problems and not run to a manager for every little approval. Their agents don’t follow scripts — that’s too much for my comfort level but if I still ran my agency I would give it a try at least. Agents who want to be there and buy into the culture of “WOWing” the customer.

Customers get upgraded shipping so they are expecting it in 3 to 5 days but they get it in 2 days. We used to do that at my travel agency and people loved it. Nowadays everything is e-ticketed so I may be showing my age a bit.

Don’t quote me directly on this, but Zappos agents don’t have call timers; that’s something I advocated and implemented when I ran a call center. It simply didn’t make economic sense for my company to rush through phone calls so the customers problem wasn’t solved and they are angrier than ever and calling back — to then receive yet another agent looking to get his bonus for staying under 3 minutes on a call.

Is there an opportunity to give your line agents and consumer facing staff more credit and more incentive? To reduce their load so the quality of their work is better? To recognize those staff members that get positive feedback from customers?

When’s the last time you called your key customers and thanked them? When’s the last time you upgraded their shipping or sent them a personalized free gift? When’s the last time you remembered their birthday, their anniversary date or something unique about them that showed you actually cared?

If you don’t have time to do all your customers, then make the time for your key customers at least (the 80/20 rule).

I’m not saying you should implement what Zappos did lock stock and barrel — I argue that some of the things just can’t be done by a smaller company but that’s for another post — but I am recommending to tackle the low hanging fruit.

If you don’t, there are travel companies that will.

BTW, if you’re interested in the Delivering Happiness book, http://goo.gl/phtyk.

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7 Simple Suggestions for Any Online Travel Company

One look at industry wide customer satisfaction numbers for online travel speak for themselves; they’re abysmal.

offer random cash back

Are you nuts? You want me to give money away !@#$!@#??  I know how low your margins are. Relax. Start with the customers booking for the 2nd or 3rd time. If you don’t have a system to track that, your punishment is randomly giving money away. Call customers and ask what their favorite charity is and give the rebate to them. Better yet, give $500 USD (or some %) every month to a different cause.

REMEMBER ME

Make me feel like I’m your only customer. I wrote a whole post on personalization that I think every OTA should start to implement. Make the traveler feel special and you’ll marvel at your higher revenue & conversion rates. Whether it’s “Dear Abrar” and not “Dear Traveler” on e-mails, to calling after my trip to see how things went, to more intricate customizations like answering the phone in my name (based on my Caller ID).

TAKE INCOMING SALES & SERVICE CALLS

Don’t listen to them, answer them. I learned more on those calls than I ever did on the weekly status reports I received. Use the exact same systems and processes your agents do. You’re no longer the CEO or Owner, you’re Joe Travel Agent answering the phone. How many times do you need ‘manager approval’? How many times did you need to ask for help? How many ‘clicks’ on your agency CRM and GDS system did it take you to complete a transaction?

BOOK THE WAY CUSTOMERS DO

Buy using the exact purchasing flow your customers do. Goes for online or offline purchases. I made the mistake of buying through ‘internal’ channels for my own trips. I would email or call one of our agents, put multiple reservations on hold, they’d call ticketing when I was ready and I was done a few minutes later. In case you’ve forgotten, the rapid pricing, rapid ticketing and personalized updates is exactly what your customers want too.

Watch Non-Techie Non-Travel People

Look over their shoulders while buying online or listen while they’re on the phone. Avoid ‘helping’ and ‘explaining’ while this happens. Observe where they stumble, where they needed more information, where they didn’t understand something, if they understood your agents, if the agents actually solved the problem or not. Much to be learned.

CONTACT CUSTOMER SERVICE THE WAY CUSTOMERS DO

You thought buying as a customer was eye opening? Try doing a ticket change/cancellation with those ‘rules’ you setup for agents. Even if you know changes are not allowed, call anyway. See what your agents say. Speak to a manager. If you work at a big enough company or an offshore call center, chances are they don’t know you’re the CEO of the company so don’t worry about changing your name, etc.

call customers and talk to them

Here’s an idea, call your customers. Shoot the breeze. Get to know them. Tell them you’re the CEO and their booking has been ticketed and you wanted to say thank you. You’ll be AMAZED at their reactions. One, that management called (bigger the agency the more effective!). Two, that somebody called at all. Isn’t that sad?

I know you don’t have time to call everybody but you can call somebody. Now that the customer is in a good mood, ask them a few questions like “why did they book” and “who else did they consider” and “how much cheaper/higher your OTA was?”.

Does this work? YES.

I know, I did it. It took me a few years to figure it out but I did.

Good luck!

Customer Service as Ancillary Revenue

TICSS Customer Service Measurement Model

Image via Wikipedia

I’m suggesting a shift from thinking of customer service as a revenue source — which by definition makes it a form of Ancillary Revenue — rather than a sunk cost.

Don’t you already feel a little bit better about customer service having framed it as a revenue source?? Let’s start with an example.

When I call an online travel agency and they go out of their way to fix a problem, that creates goodwill, which has a value.

The revenue from my next 5 purchases directly related to your customer service efforts is additional revenue.

The cost of acquiring me as a customer is now amortized over multiple transactions and not just one purchase (the one with the problem which never got fixed which led me to never buy from you again).

The revenue generated from telling my friends generates additional revenue (at a low or no incremental cost). How many seconds does it take me to Tweet or worse yet FB post my experience (which you’ll never get to see and therefore can’t fix nor will it show up on any agency report).

Increase in market cap and differentiation. A little bit of customer service goes such a long way; travelers are yearning for the littlest morsel of help. Somebody at that massive online travel agency cares — there’s actually a human on the other side of this phone call.

Take the First Step.

Start with a clear intention of tracking the costs and revenue for a given set of customer(s). Intention is everything!

Start with one product and one set of customers and go from there. .

Use accurate ‘averages’ if you can’t get specific numbers. Limit your pilot to high margin products if that makes it easier internally champion.

Work with your colleagues in marketing, sales and finance.

Track the values on an Excel file if need be.

Apply it to historical data if you have all the data sets.


Why Isn’t This Done

First, Short Term Thinking. As executives and managers, we’re knee deep in the here and now that we don’t have time to think longer term.

Second, It’s not easy. The gravity and scope of what I’m advocating hasn’t escaped me. It’s a nightmare even tracking the costs and assigning a value to them. You don’t have to tell me, I’ve done this, I know.

Third, and I’m no accountant,  but my agency operations background tells me there is no universal report that shows the numbers side by side. Nothing that shows the actual costs for the customer service (say $5.00 in agent salary, $0.25 in phone call..) alongside the newly generated (or projected) revenue coming from the incremental revenue,  goodwill and lower customer amortization costs.

It’ll be worth it in the end.

Travel Startup Founders from Outside the Industry

Baggage claim area in Terminal 1 of McCarran I...

Image via Wikipedia

As an investor in travel companies — from private beta travel startups to larger VC & travel growth equity deals — I am fortunate to talk to travel companies of all sizes from all corners of the world.

One common theme are travel startup co-founders who do not come from the travel industry who reach an invisible ceiling when dealing with travel suppliers, reservation systems and members of the trade.

Foremost, If you find yourself in this situation, don’t feel bad. You’re not alone. That’s just the way it is. It won’t change anytime soon.  Heck, I wouldn’t have a job if it was that easy! Took me 12 years in travel (on the agency and travel technology side) to get a feeling for how things truly work and even now I learn new things by virtue of the seasoned executives I work with.

Secondly, there is nothing wrong with this situation. It’s what you do about it that I have an issue with.

How to Fix The Problem

  • Going It Alone: The Worst Thing To Do. There are outliers who do it alone but they are so few and far between that they’re not worth mentioning. The majority (in my experience circa 95% of) shouldn’t. The ones I’ve seen — and I can’t name them or I would — are because they are so different that traditional travel suppliers are willing to give it a shot  and these companies almost always have a very strong ‘IN’. While the founders may not be from the industry, they engaged somebody with some industry gray hair on their behalf. Rarely is it a ‘cold call’ into a supplier. Somebody new to the travel game going at it alone doesn’t have a chance past some fluke wins and never enough to have a sustainable business model. Ask for help, it’s natural
  • Get Good Advisors from the Travel Industry. Former travel executives, former travel company operators, somebody who has already done what you’re trying to do; who can advise you with your strategy and business development.  Somebody hands on through till the deal is completed. Not just an introduction and you’re on your own.  I’m biased but ask any travel startup whether I’m right. It would be one thing if “Going At It Alone” was only 2 or 3 times harder but my experience show it’s considerably longer. 7 to 10 times harder. That’s a lot of time and money to spend hitting your head against the wall — assuming you have the time and money to spare — which no travel startup ever does. All the while other travel startups are popping up every week.
  • Mashup with other travel startups/Web 2.0 Company API’s. Don’t have your own reservation system to pull flights from, what about using the Kayak API. What about a travel affiliate program in lieu of your own relationships. You won’t make alot of $ but you’ll have something to show your clients. Unfortunately this strategy won’t work because you’re selling what’s already out there. If you’re selling the same fares as everybody else, do you expect alot of transactions? You’re just keeping up appearances to avoid gaping holes on your site.  You’ll almost always need deep integration deployments which most affiliates programs don’t offer. It’s a viable interim solution. Travel startups use API mashups because they’re  (a) not concentrating on revenue or (b) as a stop gap measure until professional industrial grade travel technology (booking engines, GDS links, etc..) are available. You’ll need a proper travel technology platform if you intend on building a sustainable business.
  • Use Free or Open Source Data. You can get valuable content from Wikipedia.org to WikiTravel to a variety of places for free or for a low cost. Many travel startups already do if you take a deeper look. They have a core set of unique features complemented by 3rd party API’s (Google, Kayak, IAN, etc..). Panaramio is a good example. There are some good services out there I would use as an interim solution.
  • Do a Round to Hire A Travel Executive. This is a tough proposition. Most investors ‘don’t get’ travel investments. Be prepared for a lot of hand holding, a lot of ‘educating’, a reduced valuation and little in terms of productive post-investment relationships. While an investor “who knows somebody at Expedia” is better than nothing, knowing the contact is 1 thing — actually talking the talk in a way a travel supplier will understand is something only a travel industry executive can do best. Is that investor going to be with you every step of the way for the next 4-6 months it takes to close a deal? It can be done  — don’t get me wrong — but when you’re at a travel startup you don’t have the time to ‘experiment’ and no investor is going to put up with ‘trial by error’ on their dime.  Many a founder has realized money isn’t enough. You need domain expertise. At an angel investment level I think “non-travel” investors should be avoided unless they’re fine with putting in the money and hiring “travel experts” to formally guide the company. Being a “travel investor”, I am biased, but ask any travel startup founder and I suspect they’ll agree with me. If you have to get angel money, augment that with some travel executives and ensure everybody knows their place. The angel investors are the funds and the executives bring the travel industry knowledge.
  • Know What You’re Good At and What You Not. Or find somebody you trust to guide you. I had a meeting a few weeks ago with somebody in the tourism business who wanted to advise our experts on SEO and Online Marketing Initiatives yet prior to the meeting simply outsourced his website to somebody else and wasn’t using the Internet to sell his inventory now. It was purely a content site. My response was, what competency do you have with SEO/Online Marketing? This wasn’t a “I like to listen in so I can learn” call — which I encourage — this was a “I have some serious notions in mind” call yet I’ve never done this before all while I want to work with a team that’s done this for the past 5+ years with people who’ve done online travel marketing for the past 10 years. I gave him the benefit of the doubt and heard a few suggestions only to end the engagement 3 hours later. Its critically important to set the boundaries (ie: the vision is spearheaded by the founders, the travel related decisions are joint but favor the travel executive..) between what the (non travel) founders know and do and what the travel executives will do.
  • One Supplier Is Never Enough. Just because you have 1 vendors inventory — say a hotel vendor — doesn’t
    Image representing Expedia as depicted in Crun...

    Image via CrunchBase

    mean you have all the inventory to sell. Said another way, getting Hotels.com or CCRA isn’t the end all of all. They are both fine companies but the more inventory you can get, the better. They may be enough for certain use cases but without knowing the strengths/weaknesses of all the discount discount hotel inventory, how do you know you’re okay? Particularly if you have a broad client base. If you have a niche — say Las Vegas Hotels — and you do a deal with the largest Las Vegas Discount Hotel Provider — you’re golden. Most travel startups don’t follow such a narrow niche.

  • Inventory is critical to any travel startup. You don’t need 1 set of inventory, you need them ALL. Do you even know how many pools of discount inventory are out there — multiply that for every travel product you sell. Let alone getting ‘approved’ at the highest purchasing levels to actually compete with established players. The introductory “you’re a small agency” commissions and price breaks isn’t going to cut it. You need the volume purchasing discounts and its unlikely you’ll get that without millions of dollars of existing volume and a track record even if you negotiate well and are funded. Once you get your account setup — assuming it happens at all and it always takes more time than you could ever imagine — you still have to get the inventory from their system into yours. A Javascript embed isn’t going to cut it. Do you have a team of developers that have nothing else to do? And you need to repeat this for every vendor you plan on adding. If there are 12 pools of discount hotel inventory, that’s 12 integrations, 12 relationships, months for each relationship and that’s assuming you actually get approved. Oh by the way, all of the API’s change all the time so you’ll need to keep up. Did I mention there are discrepancies between what a reservation system says it does and what it can actually do via the API. There are times — shockingly — where the marketing team suggests features the technical team hasn’t implemented yet. As a new client — will you be in on the beta group to figure this out early? I can list dozens of situations any one of whom would bog a travel startup down.
  • Travel Developers, Not Just Any Software Developer. Depending on the use case, you may have no choice but in hiring software developers versed in travel technology. Simply hiring very good programmers isn’t enough. There is a steep learning curve when it comes to travel supplier integrations and the nuances of travel trade that cannot be taught on the fly. Who’s going to teach them at a travel startup without travel founders? I’ve seen this happen time and again. The project does get done but multiples longer and costlier than intended. Which to a founder translates to stress and investors screaming at you for missing deadlines. There’s enough that can go wrong with any software development package — which are sometimes rushed, poorly planned and underfunded — coupled with offshore development headaches that by the time you throw in the travel trade learning curve, the founder is really dealing with a low to single digit success rate for an on time deployment.

You can see why travel startups have a low hit rate when it comes to penetrating the industry. They’re fishes out of water. Rest assured there is help out there.

Give Me Your Feedback

Do you work at a travel startup? What are your experiences? Have some ‘horror stories’ to share? If you find this post valuable, please comment and Retweet!

When Airlines Should & Shouldn’t Charge For Something

Spirit Airlines Airbus 319-132 N506NK

Image via Wikipedia

Here’s a thought, if more than 75% of passengers purchase an ancillary revenue item, it should be included in the ticket price.

If 75% or more of people on a flight buy a meal — meals should be included in the ticket price.

Airlines should have a threshold in lieu of what seems to be a “what can we charge for” and “how much will we get away with” mentality.

Not all ancillary sources are bad. There are the “good” kind of ancillary revenue like day of departure upgrades and premium seating — which airlines need to focus on — and the “bad” kind like baggage fees, food, etc.

Airlines should get creative on “good” ancillary revenue — ie: up selling and cross selling.

In the mean time, ancillary fees are going up up and up!

There are fees yet to be introduced held up purely because the reservation systems the airlines haven’t been able to keep up with the ways airlines intend on charging passengers. The fees we already pay are going up.

JetBlue‘s executive vice president and CFO, Ed Barnes, told analysts earlier this month that the airline has lost some potential ancillary revenue during the past quarter by waiving certain fees in this year’s transition to Sabre.” – Travel Weekly

Why is ancillary revenue growing? It works!

Ancillary revenue is a significant opportunity for Continental,” he said. “And United has done a very good job. There are many issues related to rolling out our ancillary revenue products. There are IT issues, there are global distribution system issues, there are timing issues in terms of where it is in the chain of purchase, whether it’s a prepurchase or day of departure or post-purchase.” According to Travel Weekly,

When Will All This Stop?

Not anytime soon barring an airline charging for something we really won’t stand for (ie: bathrooms, to charge for sitting down on the plane versus standing up..).

Who’s Bucking the Trend?

Southwest Airlines which maintains no baggage fees.

TravelWeekly.com 2010 Consumer Highlights

Highlights from the  Travel Weekly 2010 Consumer Survey (click link for complete survey)

18-31 year olds like using Travel Agents

Who knew! The 18 to 31 year olds represent 14% of the population yet represent a significantly higher percentage of the leisure travelers who use traditional agents. This is attributed to, among a variety of reasons, to that generation wanting to be coddled and online information overload.

Information overload

Frugality is the new norm.

Travelers are 36% more likely to use coupons, 35% more likely to wait for sales, 26% more likely to buy online.

The Only Green People Want To See Are Lower Fares

Of the total surveyed, 84% said no or are unsure about paying a higher fare to use a travel supplier that demonstrates environment responsibility.

Lists 4 different “tribes” of leisure travelers.

Sensationals make up 28% of all leisure travelers and are the youngest of the four segments (mean age of 40). They tend to be professional singles and couples with a preference for action/the club life. They also favor adventure and outdoor vacations, clothing-optional/spa destinations and travel primarily to play. They are particularly receptive to travel deals discovered through flash emails.

Families represent 23% of all leisure travelers. They are family-vacation-oriented, represent the second-youngest segment by age (mean of 42), reside in dual-income households with children under 18 and are package-travel-oriented. Their preferences include theme parks, predictable experiences, cruises and beach vacations. They are safety-conscious and are smart comparison shoppers.

Touristers represent 23% of all leisure travelers. They are happily married and the second-oldest group (mean of 47), entrepreneurial/driven to succeed and favor “no-mistake” travel. They view travel as an opportunity to learn. They take the most trips and spend the highest amount per trip. Their travel preferences index highly on family visits and high-end global destinations.

Extraordinaires make up 26% of all travelers and are the oldest tribe (mean of 52).

More than one-third (36%) are grandparents. They tend to be wealthy empty-nesters seeking urban cultural experiences with a particular interest in museums and the theater. City, European and other foreign destinations index highly in terms of their preferences. They have a penchant for boutique hotels and resorts.

15 Enhancements for your next Medical Tourism Conference

Picture by ThinkPanama
 

How to make medical tourism conferences more effective for presenters and attendees.


 

Questions You Need To Answer

Why medical tourism as a whole, why your country in particular, why this specific city and how is it overwhelmingly better than onshore services? Once I’ve convinced then tell me how I can sell these services including who typical customers are and their respective sales tactics.
 

Local Representation

Ensure native speakers read over all the presentations, review all the content (online and offline) and listen to the presenters. This ensures the format, look & feel (language, colors, navigation..) of the presentation follow local norms. This also minimizes cultural faux pas and ensures “happiness” and “co-operation” means “a high satisfaction rate” and “partnership opportunities”. Native speakers must be fluent in the local culture, language and preferably  been born or spent at least 5 years in the country you’re presenting in.
 

FAMiliarization Trip

A hosted familiarization trip is critical to generate sales. Travel companies will not promote your destination until they’ve visited the country and facilities they intend on offering their clients. It is too much of a leap of faith particularly for such a sensitive travel product. Imagine a customer hearing “I have / the owner of the travel agency have personally visited Busan Korea and toured multiple facilities. Let me tell how professional they are and how they’ve exceeded all my expectations. I thought it would be like ____ but I was pleasantly surprised to learn ________” – let me show you some of the video & pictures we brought back”. Priceless!
 

Content

Have ample content in multiple modes available including  audio, video, brochures, packets, white papers, promotional materials (bags/pens/notepads..), case studies, testimonials, etc. Answer all the questions patients and travel trade will or could potentially ask from the time the person leaves until they return from the treatment.
 

Local Testimonials

If you already have Americans, Russian and Europeans clients, have your testimonials reflect customers from these areas. Too many testimonials are from the destination and not the local country.
 

Non-Native Presenters

Its better to pick speakers who are bilingual or speak the local language with an understandable accent. All others should use a translator.
 

Suggested Topic Flow

Medical tourism conference attendees want to know about the country as a whole, then the city in  and then information on specific providers. Make sure the MC for the event is a local and ensure strict organization and flow from one topic to another.
 

Address Common Mis-perceptions About Your Country

Attendees already know or will soon know what the consensus is about your country. Is crime a problem in your country? Address it, don’t avoid the subject – Deal with it. Is crime a misconception? Provide reputable facts from multiple credible sources to prove your point including sources from the country you’re presenting in. Let’s use South Africa as an example. Depending on where you go, crime can be an issue. South Africa Medical Tourism needs to address this while they have the attendees attention rather than bringing up the subject after the conference.
 

English as a Foreign Language

If your medical tourism destination is non-English speaking or perceived to be, address this from the time the patient arrives until they leave the country. Will they have bilingual staff available and if so what are their backgrounds (ideally they will have studied in the local country). Is the hospital staff bilingual? Do you deal with international clients now and if so how many from the country you’re presenting in? Language barriers are critical to address in no-uncertain terms.
 

Present at Multiple Conferences

Host sessions or speakers at more mainstream travel trade conferences (TheTradeShow, WTM..) in addition to medical tourism specific conferences. To build a long term relationship – which is in the best interest of the medical tourism destination and local travel agencies – you must be seen as an authority and seeing a destination in more than one conference is a big part of that.
 

Explain “How”, not just “Why”

Conferences answer ‘why’ a destination should be considered for medical tourism but don’t offer concrete examples of how a travel agency or a tour company can take advantage of medical or health tourism services. Make it as easy as possible for the travel agency/tour company to sell your medical tourism services and answer all the questions they and the patient would have beforehand. “We offer pre-packaged tours and build your own tour services” but individual add-ons are also available both of which pay 20% commission. Here are a list of vendors who already sell these services and here are tools to help you design your own travel products. How will the travel agency earn revenue and what steps are required for a typical sale? How does an agent book a sale and how is payment confirmed? What guarantees are there? Make it as ‘turn-key’ as possible for sellers.
 

Speak to the Audience

Ensure the content is tailored to who you’re speaking to. You cannot have a one size fits all presentation. How you speak to the travel trade is different to the way you approach patients.
 

Listen

The conference is an excellent opportunity for foreign providers to interact with (local) potential customers and partners. Use this time to understand our motivations and pain points and incorporate what you’ve learned during or after the conference.
 

Start and End On Time

A few minutes here and there is understandable but any longer is unacceptable.
 

Food

This isn’t a requirement but it can be assumed that attendees to a Korea Medical Tourism conference will expect Korean food during the conference.
 

If you are a Tourism Ministry or Government Official in need of assistance, contact me.