Embed Size (px)
Citation preview
Scott MehrtensManaging DirectorLeisure Time Tours | Travel Time South Pacific
TECNZ Board Member
Who am I? And why am I talking to you today?
I run a family-owned tourism operator business that’s been delivering inspirational tours for over 30 years.
We are a full-service Inbound Tour Operator (ITO) and Destination Management Company (DMC) for New Zealand, Australia and Fiji.
We create innovative tailor-made itineraries and provide quality ground arrangements for international wholesalers, agents and their clients.
• Group travel• Special Interest• Independent travel (F.I.T.)
• Small group escorted tours• Incentive travel• Privately guided luxury travel
As an ITO it’s essential we can:
• build exceptional relationships with suppliers throughout the region/country
• provide our overseas travel partners with competitive rates, product information and customised tours
Put simply –We can make your product become part of an internationally-sold tourism package
I’m pleased to be talking to you today about the Travel Distribution Channel and the part we all play in it.
TOURISM EXPORT COUNCIL OF NEW ZEALAND
BOARD OF DIRECTORS 2017 – 2018
NEW ZEALAND TOURISM DISTRIBUTION CHANNELS
What to expect of your ITO and what they will expect of you
WHAT IS ANITO/IBO/DMC?
“An Inbound operator is just a middle man who does nothing
to add value to my business and takes a huge cut for doing
nothing”
AKA:
• Inbound tour operator
• Inbound operator
• Destination management
company
A common misconception…
WHAT IS THE VALUE OF AN ITO?
“Promote and sells your product outside New Zealand
AND
purchases your product in New Zealand”
Reality of what an ITO does…
SO WHAT DO ITOs ACTUALLY DO?
FOR OUR OVERSEAS CLIENTS:
✓ Research and recommend product to suit client specific requirements
✓ Provide product updates
✓ Offer a one-stop-shop to book all NZ product including 24/7 support and one payment
✓ Protect space for brochure programs e.g. allotments
✓ Prepare and distribute a tariff (all info in one place)
✓ Organise client famils (make easier to sell product)
✓ Participate in marketing partnerships with offshore clients to promote New Zealand
✓ Proactively seek new wholesalers to work with who are often not yet selling NZ
✓ Often operate offices overseas to support clients in converting sales/training their staff
✓ ITOs often enter emerging markets before TNZ has the funding to do so:
- teach trade how to sell New Zealand
- introduce your products to new clients
SO WHAT DO ITOs ACTUALLY DO?
FOR NZ SUPPLIER PARTNERS:
✓ Help spread news of your product with our clients and grow your sales
✓ Welcome supplier partner visits to update our staff on your product and changes
✓ Provide business year round through the variety of markets we cover
✓ Provide regular business of many types: FIT, group, series, incentive, special interest
✓ Enable easier payments – don’t have to chase your money down in the back alleys of
Timbuktu (assume any credit risk or deal with foreign currency)
✓ Invest in your product and ours by visiting our clients in-market sometimes 2-3 times
per year to grow the relationships and encourage more NZ brochure space
✓ We can easily invest several hundred hours of time and effort before any bookings are
made that you don’t see
✓ …and ITOs invest thousands of dollars in international travel costs to achieve all bringing
business to NZ and your business
WHAT DO ITOs ASK FOR IN RETURN?
• Wholesale pricing
• Access to inventory
• Rates needed 18 months in advance
• Clear and consistent Terms and Conditions
• Product information with descriptive text and imagery
• Same day turnaround for booking/quote requests
• Vital operational updates (planned power cuts etc.)
• Be proactive in providing solutions to adapt products for different markets
But remember…. commission is only paid when a sale is made
COMMISSION $
DISTRIBUTION MODEL
It is important you understand a commission is a fee you are paying someone else to promote your business. It should be viewed as an investment to generate sales, not as a cost to your business. If you do not wish to pay commission and you want to work with international visitors, the alternative is for you to go direct to each market to generate sales.
WHOLESALE DISTRIBUTION CHANNEL
Pay 25-30%
commission
ITOs ARE DIFFERENT
Different travel type:Global representation or single marketGroup coach tours only
- Series tours- Ad hoc tours- Special interest & incentive
Seat and coach tours (scheduled service)F.I.T. and self drive
Different travel client:General sightseeingPremium or luxuryCruise Business Events and IncentivesSpecial interest or bespoke e.g. golf, foodEducationFamily groups
PREPARING TO WORKWITH AN ITO?Do your homework:
Visit the TECNZ website to check which markets ITOs work in and type of client e.g. group, FIT
Visit the ITO website/brochures - check their itineraries to determine:
- Who are the ITOs customers? Their demographics?
- How long is the itinerary in your area and what do they do?
- How many passengers per group or are they FIT/SIT customers?
Consult RTO regarding ITOs who work in your region
Helpful to visit ITO office or offer ITO staff to familyour product/service/tourism offering
Know their business before you tell them about your business!
ITOs HAVE ADAPTED:
Change from % group to % FIT (self drive)
Upgraded technology and direct connect links with suppliers eg. Site-minder, Tour Connect
Online booking engines and online tariffs
Having to work harder to realise value
More detailed in presentation and itineraries
Diversified product range and itineraries
Retail/promote other ITO product
New niche ITO start ups Education, Golf, Luxury sector
Distribution into the Future
Inbound Tour Operators are reporting record levels of business from all markets, increasing year on year –the wholesale channel is certainly not dead!
Tourism goes through highs and lows – at the moment we are riding the wave
Recognise the Distribution Channel and where each player sits
Pay commission and/or rebates according to the placement of that player in the food chain
Every business wants a good MIX of all types of business, YIELDED to the highest level:
- NEWS FLASH – ITOs want that too!!
- work out your lowest acceptable nett rate and work up the distribution chain from there
- don’t bow to pressure from Online Travel for inventory access
- get your market segment mix right, the price right and work with partners you know and trust
SUMMARY BENEFITS OF WORKING WITH AN ITO
ITOs do your international marketing for you and act as a sales agent on your behalf
Access to new market intelligence, promote at tradeshows and coordinate famils
Provide long lead time wholesale bookings which helps you plan in advance and assists with business efficiency
Volume bookings and repeat business year round
Offer security of working with a New Zealand partner
The Tourism Export Council of New Zealand (TECNZ) is a B2B network.
Your investment in TECNZ will offer many opportunities to stimulate your business and encourage connections between New Zealand tourism buyers and sellers.
If you would like to learn more about TECNZ or would like to become a member, please visit the website: www.tourismexportcouncil.org.nz
Or contact:
Judy ChenChief ExecutiveMobile: 027 66 44 [email protected]
Lisa SinclairTourism ExecutivePh: 04 495 [email protected]
