Can four agencies in the same state pool their resources and pull
in clients by advertising together? Yes, according to Gerry Jung,
co-owner of New Berlin, Wis.-based Vacations Plus, who has been in
charge of the marketing co-op Leisure Escapes Travel group (Let's
Go) for about a year-and-a-half.
Let's Go has run
newspaper, television and radio ads that mention all four of the
Wisconsin agencies: Vacation Plus, Classic Travel in Menomonee
Falls, Elm Grove Travel in Elm Grove and Sunshine Holidays in
Waukesha. "The theory was to find agencies that have the same
shared vision and pool economic resources to be much more
aggressive in advertising and marketing," Jung said.
In order to handle competition between the agencies, the group
has had to keep a careful balance. On the one hand, it was
important to find shops that were focused on selling "the same
types of products to the same kind of customers," so they could all
benefit from the same ads, Jung said.
But it was just as important to find agencies that were
geographically distant enough so they do not compete yet were all
served by the same mass media, including the Milwaukee
Journal/Sentinel, which has statewide distribution. Such a concept
could probably only work in what Jung called "second-tier cities"
such as Milwaukee, St. Louis or Kansas City, Mo., not in larger
markets where the media are more diverse.
In trying to find a balance, in fact, the group has made some
mistakes. After being part of a Milwaukee Journal/Sentinel ad, one
group member realized that the paper that really served his clients
was the Chicago Tribune -- and left the group.
Let's Go works with suppliers to develop ads; Jung usually
writes the copy and has newspaper artists do the layout. Besides
advertising together, Let's Go plans to organize customer focus
groups from all four agencies, asking them what kind of advertising
gets their attention.
Although the group is not a traditional consortium because there
are no official supplier override programs in place, Let's Go is
"looking at expanding the concept" perhaps to something closer to a
full-fledged industry consortium. Stay tuned.
How to form a marketing co-op
If you are intrigued by the above story on Let's Go, the
ad/marketing co-op, and want to develop one of your own, here are
some suggestions from the group's founder, Gerry Jung, owner of
Vacations Plus in New Berlin, Wis.:Jung developed the list of group members through his personal
contacts, approaching agencies that "wanted to do more marketing
but didn't have the resources or time to do a major ad campaign
themselves and were looking for a way to finance it."
Now entry into the group is by invitation only, and those who
were the first members have retained veto power regarding new
members, "which was one way to keep issues of competition down" --
if members felt a prospect was too close to them, they could veto
its membership.Focus on agencies reachable through the same media that sell at
least similar products and are firmly committed to the
concept."The biggest mistake is to have a group that's too large," said
Jung. He thinks the ideal number is "no more than six -- a
manageable amount of members who can communicate with each other
easily."Develop a detailed, full-year marketing plan for the members of
the group that you can present to suppliers when asking them for
co-op ad dollars.Pep talk
taking enough advantage of educational industry events ? Many
agents are not. I've been talking to the heads of various agency
groups who complain that their members have not been attending
conventions because they don't want to spend money and take the
time away from their agencies.
But I disagree.The old adage that you must spend money to make
money has never been truer. I'm writing this column after attending
a three-day conference sponsored by TravelAge West in Las Vegas.
For me, the networking was invaluable. I was on a panel on agent
survival; I networked with my panel members and got three great
marketing ideas that never would have occurred to me otherwise. (I
can't pass them on to you because they involve special arrangements
with some suppliers.)
At the Giants conference in Las Vegas last October, I attended a
seminar where I learned a tip I've been using ever since: If you
have a decent database system, you can immediately contact your
clients who want to take advantage of last-minute deals.
And I'll pass on to you some of what I said at the TravelAge
West show. I've been contacted by many agents who say, "If we start
fees tomorrow, that will be the answer to my problems." Not true!
Fees are only one component of the answer. They can't replace all
your lost revenue, since there's a limit to how much you can charge
You must find other ways to make a profit, such as selling
travel insurance and working with consolidators. Also, when
charging fees, strive for profit (within reason, of course). If you
lose $10, you can charge $11, so you're making something on the
Lucy Hirleman, CTC, MCC, owns Berkshire Travel in
Newfoundland, N.J. Contact Lucy via e-mail at [email protected]; fax: (973) 208-1204.