This is another in a series of reports by editor-at-large
Nadine Godwin on customer relationship management (CRM). The
reports focus on ways travel firms build lasting, more profitable
relationships with their customers. CRM generally relies heavily on
customer databases that enable managers to customize programs for
clients.
Travel Weekly's technology conference, in Chicago May 20 to
22, carries a companion theme: "Using Technology to Strengthen
Client Relationships."
Learn more about CRM in editor in chief Arnie Weissmann's column.
MILWAUKEE -- It has been 25 years since Funjet Vacations
identified its top-producing agencies (16 at the time) and made
them members of the 500 Club, which indicated each had booked 500
passengers on the operator's products the previous year.
These days, to qualify, an agency's sales for other Mark Travel
companies count toward the 500-passenger tally, but 250 have to be
with Funjet.
Using the club and the data the firm has collected on top
producers over the years, Funjet can focus its special promotional
efforts where it is certain to be most effective, among a very
loyal group of 500 Club agencies, now numbering close to 600,
mostly concentrated in the Midwest and Texas.
Kim Rose, director of sales, said Funjet gets 73% of its
business from 500 Club agencies; for all of Mark Travel, they
deliver 67% of the business.
She said the company believes it gets about 30% to 35% of its
sales because it operates the club.
The relationship with 500 Club agencies is both personal -- very
much one-on-one -- and becoming increasingly high-tech.
Making the high-touch point, Dallas-based Terry Linex, vice
president of Funjet's southern division, said, "These people are
like family, my best friends. ... These are the most important
people in my life."
Today, the club uses technology not available at its founding.
In a recent example, Funjet created a postcard direct-mail campaign
promoting Las Vegas specials.
Participating agencies provided client lists, and Funjet sorted
the lists for previous Las Vegas customers and mailed postcards to
those clients. Each batch of cards carried the name and phone
number of the appropriate agency.
This was November, and the aim was to give a battered travel
industry a boost. Rose said the campaign generated $60,000 in
revenue in 10 days.
One participating agency was Crossroads Travel in Milwaukee, a
$4.4 million leisure business where, eight years ago, air accounted
for 50% or 60% of sales.
Today, air is about 10% of sales because the agency "saw the
handwriting on the wall" even before the first Delta caps in 1995,
according to Steve Marinkovich, who co-owns the agency with his
wife, Mary Louise.
Also, in focusing on tours and cruises, the agency hones in on
Funjet products as a specialty and relies on the Trams ClientBase
database management product to track client travel habits and
preferences to better target promotions.
"You can't do this out of a shoebox," Marinkovich said.
He signed on for the Funjet Vegas postcard promotion last
November. Funjet sorted his data file and sent the postcards to
about 2,000 customers; his agency took the calls, reaping about 50
bookings and $4,000 to $5,000 in additional revenue.
Ordinarily, Marinkovich said, he would expect more return.
However, given the timing, he was happy to get that much,
especially as his investment of time and money was minimal.
Independently, Crossroads uses its database for its own postcard
mailings. Marinkovich creates the cards, "always in a garish color
... [because] I want my mailing to stand out."
His last cards went out last summer, to about 3,000 clients,
promoting Funjet's 2002 products and prices. The agency got about a
10% payoff, meaning 300 bookings, Marinkovich said, and that was
well ahead of the 2002 season.
Funjet Vacations
Objective: To reward productive agencies and
stimulate more business from those same agencies
Action: Creation of 500 Club
Results: Incremental business from agencies of as
much as 50%
Crossroads Travel
Objective: To give business a boost post-Sept. 11
Action: Participating in Funjet-led postcard
mailing to targeted audience
Results: An incremental commission income of
$4,000 to $5,000