This is the final in a four-part series featuring practical advice from the creators of a sales and marketing DVD series for travel agents.
Looking for the leisure travel niche with the greatest profit potential for your agency? Think groups.
Group sales can drive growth in agency revenues much faster than individual travel –– and at significantly higher yields, according to sales and marketing strategist Stuart Cohen.
Group business also will create exponential sales growth for a travel agency, as group members book individually and form splinter groups.
When it comes to making the most money in the least amount of time, it’s hard to top group business, Cohen told Travel Market Report.
Strength in numbers
“Group sales mean faster revenue growth – instead of booking one room, you’re booking 10 or 50. You make more commission, and you step up to the next revenue tier,” said Cohen, who headlines one of a five-part DVD series for travel sellers on ways to improve their business. In Cohen’s DVD, “Group Sales,” he focuses on how agents can grow and serve the group market.
Also, “you’re not selling one by one, so you don’t have to spend the same amount of time making each sale,” added Cohen, who hosts the Stuart Cohen Show, a radio talk show on travel.
Another huge benefit is exponential business growth for agencies that can easily spill over into individual travel sales and additional group bookings.
“Say you move 20 passengers and next year that grows into 24. There may be a splinter group, where two of them go on two trips a year, so you get their business. The group explodes into more individual business.”
Higher profit margins
Group business is especially profitable, as it allows travel sellers to earn more than supplier commissions, Cohen added.
“You can package it up, add in value, and easily mark it up. Why? Because they can’t book it (themselves) and have the same experience.”
Group travel also involves relatively low advertising or marketing costs, he said. “It’s a finely targeted group – a specific universe you are going after.”
‘Supersize’ the package
To maximize profits, Cohen recommended that agents “supersize” packages so they include as many desirable options as possible.
“They may end up buying these on their own when they get there, so you might as well make money by including them – and charge accordingly.”
Even if the package is more expensive than that of a competitor, it won’t be a deterrent, Cohen added.
“If the tour price tag is higher, but the experience is greater, the client will still pay more to book with you. People want the best vacation. If the value is there, they will buy it.”
Where do you find groups?
Where are potential groups to be found? Everywhere you look, according to Cohen.
“It’s a matter of seeing the forest through the trees.”
Cohen advised agents to start with their own inner circles – family and friends – and then move outward.
“You will be shocked to find, if you ask family members or friends, that everyone is part of some organization or club. Or they may be part of a company that does sales incentives. Just within your own circle, there are many potential groups.”
Your best clients
Another source close at hand lies within an agent’s existing database of individual clients. Cohen suggested agents organize and escort a tour for their best clients, something that could even turn into an annual event.
“Tell clients that this is a very special invitation to only my best clients. Join me and my spouse – we’re going to learn and explore and have fun. People love the idea of a special tour. It’s also important that they know you are going, as they have faith in you.”
Hot group niches
Another big source is celebration travel for birthdays, weddings and anniversaries. Despite the fact that celebration groups are usually not large, they are well worth pursuing, Cohen said.
“Celebration vacations are the number one reason people travel as a group. So why not do a whole slew of 20-person celebration groups – that’s as good as one group of 100.
“A lot of agents think a group has to be big, but that’s not so. Your business can flourish with small groups.”
More group markets
Reunions, associations, religious groups, clubs, and educational groups are also prime markets for group travel. Most associations and clubs have websites, so the Internet is a good place to find potential business – as is talking to everyone you know.
Cohen singled out religious or spirituality travel as a particularly big trend.
“That doesn’t always mean a traditional church group, but can be a cruise or tour that combines sightseeing with Bible study,” he said.
“Agents don’t have to create a custom theme group for this, as so many tour operators and cruise lines already offer these themes.”
Good follow-up essential
While group business provides especially good opportunities for repeat and referral business, it doesn’t happen automatically.
The best time to promote a tour for next year is while the group is still on the first one, Cohen advised. “That’s when they’re excited and bonding.”
Afterwards, agents should send beautiful handwritten thank you cards with photos from the trip; email messages are not personal enough, Cohen said.
Nurture groups on Facebook
Facebook also provides a golden opportunity for nurturing group business, he added.
“You can build a Facebook page specifically for your tour group. People can communicate with each other about how excited they are about the trip. They can see all the pictures people have taken of one another.”
If the group has a common interest or hobby, there is a strong chance that people outside the group who share that interest will find the Facebook page and decide to travel with the group.
“Facebook leads to this kind of exponential growth, as it connects people with common interests.”
Stuart Cohen’s DVD, “Group Sales,” is part of the five-DVD Travel Agent Success training series. The series features marketing and sales advice from travel industry thought leaders.
For more expert sales and marketing advice, see Parts 1, 2 and 3: “Want Loyal Customers? Treat Them Like Your Dog,” Oct. 27, 2011; "Why Are Your Sales Slow? Look in the Mirror," Nov. 3, 2011, and “Social Media Is Noisy, So Agents Must Rise Above the Din,” Nov. 10, 2011.