Collaborate for Travel Success

While much has been said over the past few years about suppliers going direct to the consumer and no longer being the “true” partners, the late-November announcement by Azamara Club Cruises and Virtuoso underscores the fact that suppliers and agents continue to work very well together.

To me, this agreement demonstrates that suppliers and large travel agency groups can creatively collaborate for their mutual benefit and, on a smaller scale, you can, too! If you’re not familiar with it, in addition to earnings based on overall sales, Virtuoso travel agency members can now earn commissions and/or incentives based essentially on the profitability of that sale to Azamara! Not all sales have the same margins for a supplier, so it’s those “high value” customers who are the most tantalizing.

In Azamara’s case, “high value” customers are presumably those who book a top-end cabin, book further out, spend more on board, buy the longer cruises and so on. Bottom line: when a travel professional sells a high value customer on any supplier’s products, the supplier can afford to pay more commission.

While it’s unlikely that any supplier is going to make the same agreement with an individual agency, here are some thoughts on how you might leverage similar ideas with your suppliers when it comes to cooperative advertising, short-term or targeted incentives, sales support, etc.

Get over it: First, don’t expend time and energy worrying about the issue of suppliers selling direct to the consumer. If suppliers can do so cost effectively, they will. That’s their job and the profitability of their company is their key driver just like the profitability of your agency is your focus. There’s plenty of opportunity for you to do well, so don’t fret over it.

Know your sweet spot: Focus on those sales that are difficult for the supplier to consummate directly and/or cost effectively and are the highest value sales for you and the supplier. What are those sales? Typically, they are longer, more expensive, more complex vacations that involve multiple components (air, cruise, pre- and post-hotels, private car and driver, independent sightseeing, etc.). This is where the customer needs your expertise and it’s also where the supplier may find it more challenging to serve the customer without your help.

Consider the supplier’s perspective: While you may think of them as large corporations with tons of money, travel suppliers are businesses just like yours, albeit on a bigger scale. The money they spend with you in cooperative dollars is an investment on which they will be expecting a return. Within reason, suppliers are willing to invest as long as you have a credible plan to spend it and are willing to commit to a goal. They are particularly interested when your plan will generate sales that they might not gain on their own or increase their percentage of high-value customers.

Commitment is a two-way street: When the supplier is making a dollar or other commitment to you, they are rightfully expecting a commitment from you in return. More than once, I’ve heard travel professionals respond that they would do the “best” they can. That’s not good enough. While you may not be technically guaranteeing sales, it’s reasonable for the supplier to expect to see a goal and a credible plan to achieve it. Exceeding that goal should be your hidden objective but certainly attaining it is critical.

Deepen customer relationships every day: As an industry, we’re in touch with the client during the information gathering, sales and pre-departure phases, but we tend to go dark on the client until they call us again for another trip (we hope). You’ll grow your business dramatically by using various and regular client contact techniques (e.g. email, social media, personal notes, phone calls). Concurrently, you’ll likely be helping your preferred suppliers to access high-value travelers that they might not have reached otherwise.

Collaboration and communication are musts: Work with your supplier partners to help them succeed and you will end up succeeding in the process as well. Keep them apprised of your efforts and successes. If something doesn’t work out as planned, let them know what marketing or other efforts you’re undertaking to compensate for that. As hokey as it may sound, you really can be a team that reaps mutual benefits.

The concept of a supplier working creatively with a retailer to grow the most important and lucrative sales for both has been around for a long time. It’s nice to see it being done on a larger scale, but you, too, have the ability to make it work for your business!

Jack E. Mannix, CTC, is head of his own consulting firm, Jack E. Mannix & Associates. He also serves as chairman of The Travel Institute. This column is adapted from one appearing in the December 2013 issue of Agent@Home magazine.