This is the second in a Travel Weekly 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.
JOLIET, Ill. -- Mark Karner, owner of Karner Travel here, says
he is a "self-proclaimed idea guy," and he sometimes "is up until 2
and 3 in the morning trying to think of ways to keep clients coming
back" to his $5 million leisure agency.
He also said it is "hard to gauge what the public wants" in a
group tour program.
So, a couple of years ago, he hatched the Karner Travel Ltd.
Vacation Club to build loyalty and get a better handle on customer
preferences.
Central to this is the club's application form, designed to
collect information to make better use of the fields in the
agency's ClientBase software.
Because Karner is increasing his emphasis on group packages, he
tailored some questions to learn how clients feel about traveling
in groups and what features they prefer with such trips.
There is no cost to join, but Karner said he needed to offer
membership benefits that were immediate and tangible.
For each new member, he offers a Karner Ka$h Certificate, worth
$25 against the customer's next cruise or tour.
Members also pay lower service fees than other clients. Although
the agency can promote hotel deals provided through its Giants
membership to any customer, Karner emphasizes the hotel program as
a benefit to club members.
When members get documents for their first trip, the agency
provides the next Ka$h certificate, which -- based on commissions
earned for the first trip -- ranges in value from $25 to $50 per
booking. That certificate is applicable to the next vacation, valid
for one year.
More than 1,000 have signed up, and the number keeps growing,
Karner said. Club members are a subset of the agency's ClientBase
list of about 5,900 names.
Because the information is quite detailed, Karner said he can
pitch to specific subsets of the club membership, too.
He promotes the club at his Web site at www.karnertravel.com. He said the club tightens bonds
with existing clients and brings in new ones, as well.
As a result, he has updated and enhanced data on old customers
and added new names.
Indeed, he said, he is getting plenty of referrals, not
necessarily to the club, and is growing the agency's total database
by about 100 to 250 names per month.
Karner estimated that 75% of his business comes from repeat
customers, and he believes the repeat rate is higher among club
members.
However, he has not tracked repeat rates or calculated the
portions of coupons that are redeemed.
"I should do that. It's another thing on the agenda," he
said.
Nevertheless, he said, "I know the club is working."
Besides, information on the applications enables the agency to
plan group trips with more confidence and makes them easier to
sell, he said.
Karner also is working hard to collect e-mail addresses from all
clients, a detail missing, not surprisingly, from older files.
Ordinary direct mail is not effective enough, in Karner's
experience, when measured against the cost.
E-mail is much more cost-effective, and he communicates
electronically with customers about every two weeks, he said.
Do you have a high percentage of repeat business? How do you do
it? Write to Nadine Godwin at [email protected].
• • •
CRM road map
Objective
To build customer loyalty and learn what prospective group tour
members want.
Action
Launch a vacation club using an application form designed to gather
the desired information.
Results
A club of about 1,000 members, a growing and cleaner database and
the ability to refine tours for this clientele.