Senior Editor Michelle Baran sat down last week with National Tour Association President Lisa Simon in Las Vegas at the NTA's annual convention to discuss how the organization is reinventing itself by focusing on emerging and niche markets and by becoming a truly global, rather than purely domestic, association.
Q: You're clearly addressing market segmentation aggressively. Why?
A: We're finding that some of the more mainstream, more traditional tour operators are looking for ways to diversify their businesses, mostly because of the economic impact over the last several years.
Q: How are you picking which niche segments you go after, in what order?
A: A few years ago, we recognized diversity, and we started developing strategic partnerships with a lot of organizations that would give us access to more emerging markets and products, like the African Travel Association.
The strategic partnerships we developed initially were for more long-range planning and product development. And what we're saying is, "What are our members doing now?"
This is a result mostly of economic conditions. They're not planning for the future; they're planning for right now. So we have done some research within our own tour operator base to see what [markets] are they in, what are they doing. And the top three were faith-based, adventure and student.
So we're really focusing a lot of our education in those three areas. And of course, with faith-based we've taken an expanded approach to a program there, and we're looking at using that as a pilot in the other two areas.
Q: Why did you choose to focus on a segment like the Hispanic market, vs. looking at African-American travelers?
A: We've been talking about doing something with the African-American market for quite some time, and it is really important. But we don't have a large African-American member base.
Not that we have a large and significant Hispanic base, but we have some members who are very actively involved [in the Hispanic market who] pushed and said this is something we have to do. And we really have to do the same within the African-American community.
Q: Where does membership stand now?
A: I'll be very candid. From 2005, after [the name change to] Crossphere and then some of the economic issues, we lost some members, mostly on the supplier and destination/DMO side. We really didn't see a significant dip in our tour operators, but we didn't see significant growth, either.
This convention was a really positive sign, because [attendance is] up 18%. I know there's a Vegas factor there; location is a huge part of it. But I really think we have turned the ship to a point where people are getting value that they hadn't seen for several years, perhaps.
We got into kind of a rut of doing the same thing we had always been doing. Over the last couple of years, we've been working hard to get out of that rut and really demonstrate that we can provide beneficial programs and bring people together in a way that helps them with their businesses.
It goes back to the international and special-interest markets. Those are the areas that are allowing us to bring new things to the table, and that is what I think is drawing additional attendance and members.
Q: What are members responding to?
A: We removed some of the clutter from our communications, and so we're talking more directly to what is important to them. ... Quite frankly, I think people tuned us out for a while, and it's hard to get people to tune back in. But I think they're tuning back in.
The economy does play such a specific role, because while a lot of people may be hurting financially, whether their budgets are cut or they're cutting back, they also need new business. So associations are a good place for them to find a lot of substantial value in both education and business opportunities.
Q: When did you see the turnaround in terms of membership?
A: Last year we were ... seeing an improved positive attitude and view from our members about NTA and hearing things that were positive in the industry. But it didn't show up and wasn't reflected in our numbers, because then we got hit with the 2008 crash.
In 2007, we actually went up quite a bit because of the China [Inbound] Program. So we added a fair amount of China-America operators. ... Then in 2008 the economy just killed us, [with] DMOs particularly and a lot of suppliers.
This year, we saw actual growth in both membership and the convention attendance, and that's what tells me things are improving, at least in the outlook of our members. Hopefully they're seeing improvement in their numbers, as well.
Q: Regarding the China Inbound Program, the concern all along has been with the quality, safety and security of the product. Have you looked at ways to better ensure that operators on the approved inbound operator list are trustworthy?
A: We recently removed an operator from the program. We were able to do it and were confident about doing it because we had very clear proof that they were selling below market rates. And they were basically forcing certain shopping situations. Because we had pretty clear evidence about that, we were able to remove them from the list.
That was the first time I think I felt that we have the grounds to do this if we have the proof. The problem is when we hear about things, and even about specific companies, nobody ever wants to be official with a complaint or provide any backup. When we look at their websites or their tour materials, they're all attesting to meeting the requirements.
Now there have been some red flags on some others, and we are investigating. ... We continue to be extremely concerned about the safety issues.
For news on tour operations, wholesalers and river cruising, follow Michelle Baran on Twitter @mbtravelweekly.