A travel advisor once asked me how to make money in travel. Here is my answer based on a lifetime in travel and management consulting: I suggest advisors book cruises exclusively.
I have three reasons for this:
First, cruises are a high-ticket sale generating large commissions.
Second, cruise passengers are repeaters. Real results flow from winning these clients and retaining them as they book again and again.
Third, cruise passengers often travel with others, creating even larger sales.
Why chase or service clients booking air or land when focusing on cruises and related sales such as precruise hotel and insurance are so attractive?
Here is a typical commission for a couple on a seven-day Caribbean cruise: $2,500 @ 12% = $300. Add a one-night stay at a hotel prior to departure, insurance, shore excursions and a $25 booking fee, and the total exceeds $400.
What other type of booking can consistently earn more?
1) Promote and sell cruises exclusively. In addition to the usual specialization preparation, have copies of menu and activity sheets from your preferred vendors. Refer to your CLIA training and certification. Clients respect these designations. Talk about ports, not just ships. Ports are as important to clients as the ship you recommend.
2) Promote and sell preferred vendors, and push to reach higher commission levels (10% to 16%) with preferred lines. A 10% commission has a cost of handling of 8%, leaving a 2% profit. A 12% commission has the same 8% cost of handling, rendering a 4% profit. Twice the earnings.
3) Do not discount. Clients seeking discounts will gravitate to whoever offers the biggest discount. They are not real clients, as they will have no loyalty to you. One travel company discovered that clients will pay 11% extra to receive quality service. Rather than discounting, offer a reasonable service and a price guarantee. As far as clients are concerned, the real danger is not paying too much since competition protects your client. The real danger is paying too little and not getting what you hoped for in service or product. If you insist on discounting, join 500 advisors who compete to offer the lowest price on the website Cruise Compete.
4) Start consultations with three questions: Do you have a date in mind? Have you cruised before? Do you have a cruise line or ship in mind? This will speed the discussion and assist in framing your recommendation. If they have not cruised before, ask which hotel chain they prefer. Then begin by suggesting a line and ship at that level of quality. Or consider asking them to complete a brief questionnaire prepared to identify cruise preferences.
5) Once someone has booked a cruise, send them a bon voyage card, a welcome-back card and a hand-signed, four-times-a-year newsletter. This is crucial, since historically, 60% of individuals will go to a different advisor for their second booking. Most go because they feel their advisor treated them with indifference. Don't forget a decent gift during the holidays. A one-year subscription to Conde Nast Traveler for just $10 is an excellent monthly reminder of their value to you.
6) Sell insurance. Offer it at the time of booking, and put the insurance charge on the invoice. Require clients to decline insurance if they do not accept it. As many as 80% will buy insurance if it's properly promoted and presented.
7) Ask if a couple will be cruising with anyone, because 25% will say yes. Ask if they belong to a club that would enjoy cruising together. Pursue clubs that have traveled before, have high meeting attendance or have a newsletter. Look for demonstrations of strong affinity.
8) Book the entire trip rather than just the cruise. Include air, transfers, overnight hotels and shore excursions. Once the cruise is booked, these extras are easy and profitable to sell. Funnel a precruise hotel to a hotel that offers transfers and a special commission for your ongoing support.
9) Promote cruises instead of handling regular airline tickets. It is a better use of your time. Working with the airlines is an aggravation, and there is no compensation for aggravation. Do the airlines meet your standard for customer orientation? Why trust them with your reputation?
10) Consider this: Most people invite 250 people to their wedding. That circle of friends can become your pool of future clients. If you have 100 cruise clients who know 250 people each, you have a pool of 25,000 possible clients who know someone you have helped. Converting former cruise clients into a sales force is your goal. To stimulate referrals, you may wish to provide a cash acknowledgement to clients who refer others. A focus group unanimously endorsed this policy.
11) If you wish to sell inclusive vacations in addition to cruises, tell clients of this capability only after you have handled a cruise for them. This maintains your reputation for being specially focused on cruises. Take your preferred cruise line business development representative to lunch. Share your marketing plan and solicit their recommendations. Ask if they can accompany you to speak to a group cruise prospect. Do your part in supporting your rep.
12) Charge fees. The largest cruise agency in America charges $24.99 per booking.
Bob Burke is a retired management consultant and former cruise travel advisor. He can be reached by email at [email protected]. Comments or questions will receive a same day response.