These are good times in retail travel, but when luxury travel seller Jack Ezon contemplates the industry’s future, he still sees two prevailing threats: The difficulty of retaining talented young newcomers and dwindling relevance in the face of advancing technology. Embark, the luxury agency that Ezon launched earlier this year, is his response.
Ezon is former president and partner of Ovation Vacations, where in just six years he oversaw annual sales growth from $3 million to $125 million. He credits the remarkable growth, in large part, to a keen focus on attracting and cultivating talented young industry newcomers.
But retaining those savvy young advisors proved daunting. “The common thing I kept hearing was, ‘I want to invest in my brand, not yours,’” he told Travel Market Report. A related industry problem: The inherently tenuous bonds between agencies and their independent advisors, which gives agencies little incentive to invest in their travel sellers.
Sharing the profits
There had to be a way, Ezon thought, to engage talented advisors by aligning their interests with those of the travel agency. His solution at Embark is to give advisors an equity interest in the firm, much like the shared ownership structure common to law firms and other professional services companies.
“I was inspired to imitate the partnership model where I come in out of college or law school and I have a career track, and I know that if I hit certain hurdles, in seven or eight years, I’ll become a partner. I said, why not for our industry?”
The strategy is not without risks. For Ezon, Embark’s president and managing partner, it means “giving up more to make more.” For Embark’s advisors, it means netting a smaller-than-usual percentage of individual commission earnings upfront – about 40% – in exchange for a share of company profits.
Ezon estimates that Embark’s advisors will earn about 30% more than they would on their own. That’s because advisor partners will profit not only from the firm’s total retail travel sales, but from its equity partnerships with destination management companies, which command higher margins, as well as from Embark’s ancillary business units, including an events division, and eventually other luxury partners.
Even so, persuading travel advisors to buy in likely will be Embark’s biggest hurdle, since it requires “educating people in a whole new way of structuring your business,” Ezon said.
Embark currently has five advisor partners onboard, not including Ezon, and is not seeking to add more at the moment. But Ezon is looking to build a pipeline for future advisor-partners through an alliance with Miami-based Brickell Travel. In January, the two firms will launch an entrepreneurial program for high-potential independent advisors that provides them with support in developing and implementing individual business plans.
Striving for perfection
To face down retail travel’s other big threat – marketplace disruption by technology, particularly fast-advancing artificial intelligence – Ezon aims to stay relevant to his ultra-high-end target market by attaining a standard of service not currently found in retail travel.
He is striving, he said, for an “A++ level of perfection – it’s that ultimate anticipating needs and really understanding your client and understanding how to deliver on that exceptionally.”
To that end, one of the first equity partners Ezon brought on was Master Connection Associates, the company behind Ritz-Carlton’s successful customer service training program. Why a training company? He wants to give Embark’s advisors the tools and ethos to deliver no less a service experience than their clients are accustomed to receiving at top luxury hotels.
“We need to invest more in the people business because we can’t survive on the transaction business,” he said.
Layering on AI
On the technology side, Ezon is looking to bring on an equity partner to provide Embark with a CRM that uses artificial intelligence. (Ezon said he is in conversations with two leaders in AI.) The goal is to allow Embark to “dig deeper into our customer – not just hear what they’re saying, but listen to what they’re saying and not saying.”
The CRM also will be pivotal to shifting from vendor-centric marketing to customized micromarketing that speaks directly to clients’ needs and desires. “We have to be customer-centric in all that we do.”
Expanding beyond travel
Ultimately, Ezon wants to transform Embark from “a travel company that does marketing to a marketing company that sells luxury products to luxury consumers – luxury travel being the core of that.”
“Our job is to create emotional impact throughout their experience – throughout their trip, but also throughout their lives. I think If we do it right, if we want to stay relevant, we will become curators and planners in their leisure lifestyle,” Ezon said. He envisions bringing on a range of luxury lifestyle partners, including, for instance, experts in areas such as home décor or art curation.
At the end of the day, he said, “we will succeed in specializing in our clients, knowing the world and being that tailor, using technology to augment that.”
Next time, in part two of this two-part series: Lessons from Jack Ezon.