The Travel Agency of Tomorrow

This week I spent time with the industry's top luxury travel agencies at Virtuoso TravelWeek in Las Vegas. Based on these interactions and the increased demand for travel agents, I've been giving some thought to what the travel agency of tomorrow may look like.

Years ago, the local travel agency was a brick-and-mortar office on Main Street with sunny and exotic destination posters adorning the walls.

As the age of online travel grew and travelers adopted a D-I-Y approach, travel agencies disappeared from Main Street in search of lower costs in high-rise buildings or work-from-home arrangements. What will the travel agency of tomorrow look like?

Instead of being simply a transactional office, retail travel agencies will return to Main Street as experiential spaces for luxury consumers.

Given the growing demand for curated travel experiences, I believe the travel agency of tomorrow will look much like the agency of yesteryear. Instead of being simply a transactional office, retail travel agencies will return to Main Street as experiential spaces for luxury consumers. Gone are the destination posters of yesteryear in favor of a refined, relaxed environment to enjoy coffee or wine with friends. Curated presentations Рsome travel related, some not Рhosted at the agency become "nights out" for like-minded neighbors who view the agency as expert not just in travel, but in luxury experiences. The travel agency becomes a familiar hang-out for locals to learn, share stories, and laugh together.  In short, the travel agency of tomorrow is an experiential hybrid: part wine bar, part concierge lounge, and part expert showcase.

For travel agency owners, the upside to this new agency format may include new revenue streams such as wine sales and event space rental… not to mention increased foot traffic and travel sales. Besides, what goes better with travel stories than a great glass of wine?

Bill Marriott's Twelve Rules of Success

I mentioned on Twitter that I keep a copy of Mr. Bill Marriott's TWELVE RULES OF SUCCESS in my office. I think it is outstanding advice from one of our industry's most successful leaders.

 

1. Continually challenge your team to do better.

2. Take good care of your employees, and they'll take good care of your customers, and the customers will come back.

3. Celebrate your people's success, not your own.

4. Know what your're good at and mine those competencies for all your're worth.

5. Do it and do it now. Err on the side of taking action.

6. Communicate. Listen to your customers, associates, and competitors.

7. See and be seen. Get out of you office, walk around, make yourself visible and accessible.

8. Success is in the details.

9. It's more important to hire people with the right qualities than with specific experience.

10. Customer needs may vary, but their bias for quality never does.

11. Eliminate the cause of a mistake. Don't just clean it up.

12. View every problem as an opportunity to grow.

Student Fulfills Dream at The Ritz-Carlton, Amelia Island

What an exceptional story of genuine care from the Ladies & Gentlemen of The Ritz-Carlton, Amelia Island.

A student in my special education class recently shared his dream of working as a massage therapist at the Ritz-Carlton on SBSK.

A day later the The Ritz-Carlton, Amelia Island invited my friend to join them for a full day of work and learning as a massage therapist.

A student in my special education class recently shared his dream of working as a massage therapist at the Ritz-Carlton…

Posted by Special Books by Special Kids on Monday, January 11, 2016

TripAdvisor insights on Hotel Guest Engagement

TripAdvisor has compiled a study of guest engagement and found several key factors that drive hotel guest engagement on the review site.

Among the key findings, management responses to TripAdvisor reviews can drive bookings on the site by more than 20% Click to Tweet. Specifically, hotels that responded to guest reviews were 21% more likely to receive a booking via TripAdvisor than hotels that did not respond to reviews. And properties that respond to over 50 percent of their reviews further increase their likelihood of receiving a booking inquiry by 24 percent over those that did not respond.

In addition to creating guest engagement, management responses to reviews seems to have a "halo" effect of higher review ratings. Hotels that regularly responded to reviews from guests have consistently higher reviews as well. From the study:

0% response rate = 3.81 average review rating
5%-40% response rate = 4.04 average review rating
40% – 65% = 4.05 average review rating
65%+ response rate = 4.15 average review rating.

Additionally, hotels with photo displayed on the TripAdvisor site saw a 138 percent increase in guest engagement vs. properties without photos. And for those hotels with more than 1000 photos, the guest engagement factor is a 203 percent increase over those with no photos.

As past studies have shown, the impact of guest reviews on both hotel ADR and RevPAR are significant, so any increase in reviews represents a very meaningful impact for hoteliers and management companies.

In a release, TripAdvisor for Business President Marc Charron tied guest engagement directly to management/owner engagement on the website. "Looking at the results of this study, a clear theme emerges: the more engaged the business owner, the more interested the traveler," said Marc Charron, President, TripAdvisor for Business. "It’s no secret that traveler want to see pictures and read reviews of a property before making their booking decision. What’s really key is the upward trend in average review ratings, traveler engagement levels and booking inquiries on the site, the more frequently a hotel owner responds to reviews. Taking part in the conversation and demonstrating that the owner cares about feedback has a very real and measurable effect on converting a traveler from a casual browser into a potential guest."

How to Structure a Contract for a Hotel Group Buyout

Last month I participated in a LinkedIn group discussion with a meeting planner who was seeking advice on how to structure a contract for a hotel group buyout. Like any hospitality contract question, there isn't a "default" answer for group buyouts. The most important element for both meeting planners and hoteliers is to approach the event as a partnership, with a mutually beneficial contract and good pre-event communication.

Based on the strong feedback I have received from my answer, I've taken the liberty of sharing the question and my response in context on how to structure a hotel contract for a group venue buyout.

Group Meeting Planner:
Hi! I am in the process of negotiating a contract for a "virtual" venue buy out for a staff retreat. I say "virtual" because we'll take 100% of sleeping rooms and all meeting space for our program but the outlets (restaurant, marina, etc) will remain open and available to outside guests.

Any tips/advice/clauses that I should include? I obviously want to protect the sleeping rooms, meeting space and full use of the resort for our use. However I also don't want to get stuck with unused rooms/space if for some unforeseen reason our group size is reduced.

Thanks!

My Response:
In my experience, a buyout is very much a partnership arrangement with your venue and no two events are exactly alike.

In your specific example, you are looking to ensure full exclusivity – rooms, space, facilities – and mitigate all of your risk at the same time. I see these as competing priorities and it may be necessary for you to evaluate the importance of each.

It may also be beneficial to understand that the venue is taking on risk as well. In allocating the totality of their facility to you, they "risk" the opportunity to sell to other groups/guests at a higher rate. They also "risk" lost revenues if your group size is reduced.

If exclusivity is most important to your group, it is absolutely reasonable to expect that the venue will ask you to fully guarantee all of your rooms and your banquet minimum, both with no attrition allowance. This should ensure full use of the facilities without interruption from other guests and ensure the expected revenues to the venue. (WIN-WIN)

If it is more important to mitigate risk from reduced group size, then I suggest working with the venue to establish a reasonable attrition allowance that permits the hotel to resell your unused rooms/space. The venue will mitigate its risk through resell and there would likely be other guests in the facility, but you will not be "stuck" if your attendance falls. (WIN-WIN)

A third alternative may be a bit of a blend. If the event takes place further out, perhaps the two parties would mutually review the anticipated usage and make adjustments to the room block/space hold based on reasonable assumptions. If the group is reasonably expected to be smaller, you could return some of the rooms/space without liability and allow the hotel to resell them. However, if your numbers are on target, you could ensure your full exclusivity. (WIN-WIN)

Again, the most important component of a buyout is partnership. Be confident that you have selected a true partner and you will ensure your mutual success.

Five Fresh Hospitality Reads for the Week

This week, as many begin to focus on budget planning and creating strategic plans, I'm reading more about how the hospitality industry continues to evolve in the social media era. Here are five fresh hospitality reads:

The Future of Travel: Eight Things You Need to Know | Marketing Magazine
Great piece on the critical importance of innovation in the hospitality industry.

STUDY: 44% of Luxury Guests Choose Hotels through Word of Mouth
You know it. I know it. And yet… it continues to be overlooked. For all that you are doing through sales, marketing and PR, the most critical component of hospitality remains guest service.

How Luxury Hotels Mine Social Data in the name of Comfort
Great reminder that (a) there is so much information available online about each of us and (b) some hoteliers are using that public data about their guests. I think there's a lesson in this piece about the importance of balancing hospitality/privacy.

Airlines testing new ways to Board Planes
All aboard (faster!) Also… 100 times YES!

How TripAdvisor wants to own the Travel Cycle
TripAdvisor has evolved from a review site to an efficient booking engine. Now the TripAdvisor teams wants to be the provider of choice for local area information and concierge service. I will be interested to see if crowdsourced hospitality data can ever truly scale.

Another clear indicator of how important it is to know your audience and to continue to refine your message to each guest.

For more hospitality trendspotting, follow me on Twitter.

Three Luxury Hospitality Reads for the Week

Here are three short, compelling reads regarding luxury sales and marketing in the hospitality segment. I found each of these very poignant for guest service and hotel sales in our industry:

 

Twenty percent of Virtuoso's customers drive 71% percent of sales
This statistic speaks to the old adage of how important it is to take care of your best customers, especially in the luxury hospitality segment.

Biggest risk to luxury brand dilution? Partner Offers
A new study finds that luxury brand cross-marketing is a dangerous tightrope, bringing in new customers when done well but risking market share for both brands when poorly executed.

Four Seasons Hotels are active on 393 social media channels
Is there an effective limit to the "be where your customers are" mantra that has driven CMO and social marketing? Also, is there a limit to the effectiveness of "be where your customers are" in the luxury segment?

 

Interested in seeing more about luxury hospitality sales and marketing? Follow me on Twitter

Want to Connect with more Customers? Stop being a Morning Person!

I can't believe how many emails I receive every weekday morning that ask this key question:

"Do you want to connect with more customers?"

And the answer, of course, is "Well, yeah! Don't we all?!"

A study by GetResponse.com suggests that the timestamp on emails might be as important as your message.

GetResonse analyzed more than 21 million customer emails and found that while almost 50% of all emails arrived in customers inboxes before noon, customers opened a much higher percentage of mails sent between noon and 6pm.

Additionally, the study found that 23.63% of emails are opened within one hour of when they are received. The number falls by half in the second hour and more than 90% after five hours. Clearly getting your email into your customers hands during the business day is key.

So, does this mean I have to stop being a morning person? Well, maybe not. But, if you are connecting to customers via email, you may have increased success if you time your message for receipt between 12 noon and 6pm.

Though highly, highly unscientific, my own study finds that the best time to send a handwritten card is… ALWAYS Click to Tweet.

The One Problem that Costs Hotels the Most Customers

If you consider the number of problems that can befall hotel customers during a stay, it can be a bit overwhelming.

Angry Hotel CustomersBroken remote controls. Plumbing problems. Noise from adjoining guestrooms. Incorrect orders from room service. Room key issues. HVAC issues. Kids running in the halls. Not enough chairs at the pool. Slow service in restaurants. Incorrect room type at check-in.

And the list goes on and on.

Studies show that product problems account for nearly sixty percent of all guest complaints.

But there is one problem – over and above all others – that causes not only dissatisfaction, but a complete break in a hotel customer's trust.

What could negatively impact hotel customer loyalty so greatly? According to data-analysis firm Market Metrix, staff-related problems in hotels can lead to a whopping 26.2% drop in guest loyalty Click to Tweet.

Service problems, on the other hand, make up a much smaller portion of reported problems, but have a much more dramatic impact on guest loyalty. Just look at staff-related problems in the table below. They are only 4.7% of reported problems. But staff problems punch way above their weight causing loyalty to plummet by over 26 points when they do occur.

On the other hand, the nearly 60% of hotel customer complaints COMBINED only account for a 12% drop in hotel customer loyalty.

This study begs the question: With such a large number of guest product complaints, how much time is your hotel spending to fix staff problems?

Television remotes can be replaced, but a disengaged hotel customer may be lost forever.