Surviving in Communities Hardest Hit by the Downturn

Amidst reports that sales for summer European tour business are returning and attendance at Disney theme parks is picking up (albeit with discounted admission fees and occupancy at surrounding Orlando hotels hovering around 70%) and Wave Season is strong for cruise lines, many agents reported they’re not feeling part of the so-called recovery. Sometimes their pain has to do with their location.

For example, TMR talked with an agent this week whose business is closing down on December 31 after 25 plus years in the business. It’s a planned and responsible shutdown; any business already booked for after the start of next year goes to a competitor in town, and they split the commission 50/50. Tellingly, given the economic backdrop of their local community, that competitor is downsizing, moving from a storefront to home-based.

So if your community is suffering more than most, what’s your best strategy? TMR recently asked a dozen agents with varied business models if they had any secrets that helped them survive the past two years in the travel business.

Some responded with strategies you’ve already heard about. For example, many indicated they’re diversifying the products they promote — cruise-only agencies are selling more all-inclusive resorts and so forth. And more agencies reported trying to economize through technology, such as e-mail invoices to clients as opposed to snail mail.

Others said there’s no particular strategy that’s helped, “Not one blankety-blank thing,” bluntly responded Richard Ponzio of Ponzio Travel in Pittsburgh.

Ponzio has been selling Europe groups and FITs for 40 years, and he thought he’d seen everything, but the last two years have changed his perspective, as the economy of his client base continues to falter.  He said he’s recognizing, “This is the only business in the world where every supplier says how much they love you and need you but want to pay you nothing.”

What has changed most for him is learning to be as tough as the suppliers he sells for. “For instance, when I negotiate with a hotel, I tell them I want this rate or else they don’t get the business. And I have my suppliers who, when we don’t reach a certain group number, want to increase the cost on us. I can understand that, but I tell them, ‘I’m not paying that.’ They have to be reasonable given this economy; I have to be reasonable. Normally, we’re satisfied at 50-50, because they understand more than ever if they don’t do it, they’re not going to get my customers’ business moving forward,” he said.

And you have to be tough with customers. “I still enjoy this business, and I show that to customers,” he noted. “But when I sit down with clients, the first thing I do is ask for a deposit before we go into any strong details for itineraries. If they say yes, we continue. They have to understand vacations are a business.”

Be Positive

Becky Piper

TMR interviewed another agent in an economically distressed area: Becky Piper of CruiseOne in Strongsville, Ohio. “The big majority of my clients are blue collar or middle management,” she reported. “So the bulk of my client base was hit very hard economically over the past two years.”

Piper has already cut expenses, so how does she keep sales coming in when clients are hurting financially? “The only thing I can tell you is I displayed a high level of enthusiasm about vacations with clients or potential clients,” said Piper. “Last year when things were so dismal, it was kind of like you have to fake it till you make it. Inside I’m dying; it’s crash and burn. But if someone called me during that time, I’m getting them excited. They have no clue about my internal issues.”

This year, her internalization has expanded to other issues. She doesn’t complain to customers about preregistering clients with supplier cruise lines, hassles with luggage tags, e-docs, and so forth.

“Yes, we let the cruise lines know this is taking time and is causing us to actually spend less time on selling cruises,” said Piper. “But to the client, it’s we’re happy to do it for them.” In short, she says, keep them enthused — you’re the one worrying about your job, not them.