Online, traditional distribution and packaging for tourism businesses

Emma Page, General Manager
Online, traditional distribution and packaging
for tourism businesses

The 5 stages of travel
1. Dreaming
2. Planning
3. Booking
4. Experiencing
5. Sharing
tourismcouncilwa.com.au

Tourism Distribution
Consider your clients:
 Where do they come from?
 What are your markets?
 How do you distribute?
How can I reach potential clients?
1. Directly: You can target visitors directly through advertising,
brochure distribution, website, social media, client referrals etc…
2. Indirectly: Another way to promote your business is through a third
party (indirectly) by using tourism distribution channels such as retail
travel agents, wholesalers and inbound tour operators.

How the system works - traditionally
Tourist
Retail
Travel
Agent
Tour
Wholesaler
Inbound
Tour
Operator
Local
Operator

Why work with the travel
distribution system?

Why work with the travel
distribution system?
 Broaden customer base using a limited marketing budget
 Can you compete with big name organisations like Expedia, APT?
 Keyword searches, customer loyalty programs
 Product included in overseas brochures
 Can you conduct sales calls across Australia and Overseas?
 Familiarisation visits for the retail industry and media
 Undertake advertising campaigns aimed at both consumers and
retail travel agents
 Travel distributors provide market insights and advice
 International visitors rely on advice of local travel experts
 (particularly long haul and emerging markets)
 International visitors have a higher average spend
 International visitors have different travel patterns (i.e. Germans
in summer)

Traditional trade/tourism
distribution channels

Inbound Tour Operators, Wholesalers
and Retail Travel Agents
 Retail Travel Agent – who the customer does business with (VC’s, Concierge
& Tourist desks act as RTA’s)
 ITOs – ground operators or destination management companies
 Wholesalers – link individual tour operators or ITOs with retailers
 Packages – wholesalers achieve lower prices due to volume
 Allotments – allows a wholesaler to sell freely
 Take a commission (10-30%)
 Building relationships key to success
 Their passengers should be treated well, the ITO and Wholesalers are your
friends!

Tourism Distribution
Indirect distribution example:
TOURIST sees
footage of
beautiful
Western
Australia on
the TV and
through his
friends and
decides to find
out more...
Tourist visits
local RETAIL
TRAVEL AGENT,
ends up
booking a
thorough 8
week
adventure
including
accommodatio
n, tours and
activities...
Travel agent
plans
comprehensive
WA itinerary
through the
brochure of a
TOUR
WHOLESALER
and books
itinerary
through
them...
Tour
Wholesaler
contacts an
INBOUND
TOUR
OPERATOR
(ITO) to book
each individual
element of
itinerary...
The Inbound
Tour Operator
contacts
individual
LOCAL TOUR
components
directly..

Visitor Centres (VCs)
Benefits of Visitor Centre
Memberships/Distribution to the….
Customer/Visitor:
 Like a retail Travel Agent
 Free advice – friendly, local people
 Trust local, book local
 Compliant with relevant laws and holds appropriate
insurances

Business:
 Provides local, independent, unbiased and high
quality advice
 Book your product
 Accredited Visitor Centres are promoted to WA
tourists through a marketing campaign soon to
be launched
 TVC – GWN 7, Digital and Print

Value to the region/town:
 Spend more and Stay longer = More jobs in
a region
 Overall Visitor Centres inject $117
million into the State’s economy
annually creating more then 900 jobs

How to work with your Visitor Centre…
 Become a member
 Seek advice
 Inform the VC of min numbers
 Get online
 Work cooperatively

Online
distribution channels

Travel trends and stats for 2016
 ¾ of online travel search will come from mobile.
 73.0% of people will use a mobile device to research a trip.
 63% of millennials said they booked a place to stay online.
 66% of Gen Xers did so too.
 62% of boomers also used online.
 Asia-Pacific will surpass Western Europe and North America to
become the largest digital travel sales market in the world.
 Most digital travel sales in China will come from mobile.
Page # 4

Understanding online distribution
Consumer (Domestic or international)
Distributor (OTAs, website, VC, ITO etc.)
Channel manager (No over bookings)
Online Booking System (E.g. Rezdy, Little Hotelier)
Page # 5

Benefits of online distribution
 24/7 bookings
 Increased exposure
 Minimise workload
 Gather valuable intel
 Good customer service
 Good for SEO
 Save time
 Stay in control
 Personalise
 Marketing
Page # 3

Inventory management
 The way you control how your rooms, seats or tickets are
sold
 In the past done by spreadsheets – time consuming and
confusing
 Now automated through modern online booking system
 No more double bookings!
 Great examples
 Tour – rezdy
 Accommodation – little hotelier
Page # 11

Online Travel Agents (OTA’s)

Other online distribution channels
 Airbnb
 Stayz
 Experience gift retailers
 Group Buying (scoopon)
 Australian Tourism Data Warehouse (ATDW)

Aust Tourism Data Warehouse
What is it:

Aust Tourism Data Warehouse
What are the benefits to operators?
 Massive distribution - ATDW contains over 150 travel websites
including westernaustralia.com and australia.com
 Only supply business information once, this then automatically gets
distributed to multiple partners
 Control what information and images are displayed in their listing

Commissions and pricing
your product

Industry Rates/Commissions
Do you need third party sellers and can you afford their high
commissions?
 Do you achieve 100% occupancy each day of operation?
 Can you generate 100% of your bookings directly?
 Can you afford to market on a national and international level?
Retail Travel Agents, Tour Wholesalers and Inbound Tour Operators can open
up new markets for you in a very cost effective way.
Commission is usually the major source of revenue for retail travel agents,
wholesalers, inbound operators and visitor centres.

How much should I pay?

Where does the commission go?
Inbound Tour
Operator 30%
• Keeps 10%,
gives away
20%
Wholesaler
20%
• Keeps 10%,
gives away
10%
Travel Agent
10%
• Retains 10%

Calculating the correct commission
Commission Levels Gross Selling Rate
(must be consistent)
To calculate nett
rate minus the
relative percentage:
Nett Rate third
parties will buy this
10%
$257
$257 – 10% $231.30
15% $257 – 15% $218.45
20% $257 – 20% $205.60
25% $257 – 25% $192.75
30% $257 – 30% $179.90

Calculating average commission
Supplier
Rate of
commission
Percentage of
business
Formula
Weighted amount
of commission
Direct sales 0% 50% 0 x 0.5 x 100 0%
Visitor Centre 12% 15% 0.12 x 0.15 x 100 1.2%
Expedia 15% 10% 0.15 x 0.1 x 100 1.5%
Booking.com 15% 10% 0.15 x 0.1 x 100 1.5%
Stayz 10% 5% 0.1 x 0.05 x 100 0.5%
Airbnb 3% 5% 0.03 x 0.05 x 100 0.15%
Inbound Tour Operator 30% 5% 0.30 x 0.05 x 100 1.5%
Average commission paid
(this should be factored into your pricing)
6.35%

Pricing your product
Pricing considerations:
 Price parity across all channels is important to avoid damaging trade
relationships
 Work your pricing out to allow for up to 30% commission to be taken off,
this way when you’re paying less than 30% it is a bonus
 Factor in third party payment schedules and ensure you have sufficient
cash flow to allow for invoices to be paid 30 days after travel

Pricing your product
Your prices should factor in the following:
 Your competitors rates
 Amount customers are prepared to pay
 Fixed and variable costs
 Commissions
 Your profit margin (break even point)
 Seasonality
Visit the Tourism Boost webpage for a tool to help you price your product

WORK TOGETHER AND PACKAGE
YOUR PRODUCT

Packaging and/or bundling your product
 Aligning and marketing complementary products together to form
compelling and unique experiences for the consumer.
 A combination of two or more products offered as a single unit of sale to a
visitor
 Can be sourced by partnering with other suppliers or by using a collection
of your own products
 Sum of all components should be cheaper than if purchasing individually
What is tourism packaging/bundling:
Why package/bundle?
 To encourage increased length of stay and spend in a region
 Convenience for the consumer
 Wholesale / travel agent appeal ($$ & ease of booking)

Packaging product
Example packages
Romance Accommodation – dinner for two – river cruise
Cultural Accommodation – sightseeing tour – Indigenous
Family Zoo – minigolf – movie vouchers
Aussie Farm stay – BBQ lunch – day tour
Wine/food Dinner – wine tour – brewery tour – cooking class
Art Theatre show – dinner for two – museum entry
Luxury Luxury chalet – day spa – dinner for two
Adventure Horse riding – white water rafting - caving

When developing your product
ask yourself…..
Market Suitability Does the product suit the markets that I am targeting?
Unique Selling Points Do you have a point of difference from your competitors?
Product Pricing Is the product competitively priced and does it allow for all levels of
commission? Is the product profitable?
Accessibility how do they get there?

Research your markets
Where can you find latest research?
 Tourism Council WA
 Tourism Research Australia
 Tourism Australia
 Tourism Western Australia
 Australian Bureau of Statistics
 Visitor Centre

Ensure you have all the
essential business elements
 A marketing/business strategy
(online and traditional)
 Instantly bookable
 Listed on ATDW
 Accredited
 Member of your Visitor Centre
 Member of ANW
 A GREAT website and Social Media

 Be a Domestic god/goddess. Firstly, its best to have a strong
domestic market foothold before branching to international.
 Domestic tourism accounts for 65 per cent of all tourism in
Australia, although international tourists tend to travel for
longer periods and spend more money.
 Internationally, you are competing against other companies
providing similar products, and also other international
destinations
Domestic first.

Have great Customer Service

Where to now?
 Subscribe to the TCWA and other key newsletter
 Get accredited
 Attend training and access program services visit the TCWA
Website for dates
 Attend events, build personal relationships
 Tourism Selfie for Tourism Works Comp

Online, traditional distribution and packaging for tourism businesses

Recommandé

Recommandé

Contenu connexe

Tendances

Tendances (11)

En vedette

En vedette (6)

Similaire à Online, traditional distribution and packaging for tourism businesses

Similaire à Online, traditional distribution and packaging for tourism businesses (20)

Dernier

Dernier (20)

Online, traditional distribution and packaging for tourism businesses

Notes de l'éditeur