What travel firms can teach us about scaling up
Luxury travel group Adams & Butler offers a useful case study in appealing to a fresh customer segment
JANUARY is that time of year when people think ahead and start to plan their summer holidays. I saw some advertisements in this newspaper last week and they got me thinking some more about the industry. So I did a little digging and spotted some good learnings in the case study below, particularly about fighting your corner in an evolving online world.
The internet has significantly disrupted the travel industry, as consumers have become experts in booking their own flights, accommodation and activities.
I was invited to speak at an Irish travel industry conference in Spain, on the topic of growing sales in a changing world. When I was researching the industry in advance of the conference, I was struck by the growth enjoyed by some travel agents, despite the changes.
They have fought back, reinventing themselves with tailored packages, and as specialists with great expertise and knowledge.
Consumers might well be able to book transactions themselves online but a travel agent offers significant added value with their advice.
For example, imagine if you were planning a vacation and money was no object, what would be your dream travel experience?
What about an authentic stay in village huts with a north Kenyan tribe — or an intimate dinner with an Irish lord or an English duke? What about a whiskey tasting facilitated by a member of the Jameson family in their own home?
These are just part of the day job for Dublin-based Adams & Butler. There is a global trend emerging where wealthy people are spending more of their money on personalised experiences, not just things. Adams & Butler is a tailored private travel designer capitalising on this.
Having facilitated travel experiences in Ireland for Taylor Swift, US senator Paul Ryan and the Kardashian honeymoon, it’s no surprise that founder Siobhan Byrne Learat and her team enjoy what they do. There is no ambitious dream left unfulfilled by them when it comes to personalised and tailored travel experiences.
RECENT CHALLENGES
While the celebrity business gives Adams & Butler high profile and is, of course, profitable, it also requires hand-holding. Scaling up with such a personalised business has limits, especially given that Siobhan herself is so hands-on. The company has identified a scalable opportunity for growth with business sourced in Ireland.
There is a lot of potential for luxury experiences, starting at the €10-12,000 market segment. Well-off Irish customers also want tailored experiences, albeit at a different price level to the Kardashians!
Price perceptions can be difficult to break through, as Brown Thomas, for example, knows only too well. From my work with Brown Thomas, I know that it does not knowingly charge higher prices for products that are available elsewhere.
For example, a 16cm Le Creuset saucepan is the same price in BT as it is in Ryan’s of Galway.
But because BT also stocks a wide range of high-end goods across all departments in its stores, there is sometimes an undeserved perception that it is more expensive. BT copes with that as it caters very effectively for the high-end customer, alongside the mid-range customer.
How should Adams & Butler position itself appropriately? Can it attract a new mid-market customer segment or will that customer close their minds to the brand? Is this link to the celebrity market an asset or a deterrent?
TIPS ON SCALING UP: 1 LET IT BE KNOWN WHO YOUR CUSTOMERS ARE (IF APPROPRIATE)
Noel Toolan is a marketing guru with lots of experience in travel, tourism and luxury. He believes it is possible for Adams & Butler to achieve its goal, provided it delivers a carefully managed marketing strategy.
That strategy should focus on experiences that are authentic and credible.
The link to the celebrity market is actually a plus for Adams & Butler, in his view, as it gives comfort and reassurance to other customer segments.
Wouldn’t you feel more confident in engaging with it if you knew that it had successfully managed trips for the great and the good, and yet was affordable?
2 BUILD THE PRODUCT SUITE
“Adams & Butler should take care to build and protect the DNA of the brand and consider replicating this through semi-automation,” says Noel. While high-end celebrity travel experiences might always start from a blank sheet of paper, the company may consider building basic highend travel packages that can then be customised accordingly by the consumer themselves.
What about creating standardised packages with a menu of options that can be selected and deselected at will?
The company already claims that due to tailoring, it has never sold the same package twice. This doesn’t have to change. It’s just that more control is given to the consumer to self-select their own options and preferences. In the same way that Apple sells an iPhone as a standard device, each one of us has the control to customise the screen and apps to suit our own tastes and preferences.
3 GET THE MESSAGING RIGHT
This should be possible to present and partly sell online — with less need for hands-on attention by individuals, thereby facilitating scale. Such messages are all about the experience being offered.
Quality video on social media and the company website is critical when conveying the message.
Telephone back-up is also critical. In a recent project with a team at BT Telecom, they told me that their research showed the telephone was still key as a back-up and comfort, even for online customers. This is particularly important for this mid-range market.
THE LAST WORD
The perception that customers have of your brand is their reality. Do you know where customers position you in the competitive mix? Is there a risk that your own intention for your brand is different to their reality?
If you suspect that you have a perception issue, what are you doing about it? If you don’t know, consider doing some research. Alan O’Neill, author of Premium is the New Black is Managing Director of Kara Change Management, specialists in strategy, culture and people development. Go to www.kara.ie