Dealing with the Challenges of High Prices.
January 2008
There is little doubt that the tourism industry is facing some interesting and challenging times. Its transportation component has to deal with not only the higher cost of fuel, both in the form of gasoline and jet plane fuel, but also the fact that antiquated air systems combined with a major decline in customer service have made millions of travelers understand that travel has become hard work. To add to the industry’s challenges are the continual terrorism threats and health challenges that seem to crop up on an almost daily basis. Lastly, just in case the traveler may have not noticed the poor air quality on many airplanes, high hotel, restaurant prices, currency fluctuations, non-stop television programs dedicated to tourism crimes, and seemingly endless fuel price increases, there are now a number of media programs dedicated to the issue of why travel is getting increasingly less pleasant, harder and more costly. This month’s Tourism Tidbits provides you with a few ideas as to how to identify in a time of high travel costs your most pressing tourism challenges and some ideas as to what to do about them.
- Know your product. It is always amazing how many people in the tourism and travel business are not sure of what they are selling. Are you selling basic transportation or the travel experience? Is your hotel dedicated to providing a nights rest or does it act as a places in which you can leave your troubles behind? Take the time to assess what you have and what you need to offer. If your clientele is basically business-travelers are you devaluing your product by charging for something as simple as a wireless connection or for local telephone calls? If your product is romance, have you checked the quality of your lighting, the ambiance of your entrance way and the colors of your rooms. If you seek the ‘young family market” is your attraction or hotel family-friendly or is this merely a slogan based on nothing?
- Know what people do not like about your tourism business. It is always amazing how rarely people in the tourism business forget to ask what bothers their clients. It takes very little to destroy a tourism industry. If you are a tourism office or CVB how often do you work with your community’s public services such as police and rescue squads? If you are an attraction have you considered that the “tourism family” of today may be composed of grandparents and grandchildren rather than parents and children? If you are a hotel, what services are you lacking and are you charging for something that can be absorbed in the price and then given for free. For example, many business travelers are only permitted two meals a day and thus seek out hotels that offer free breakfasts, even if the room’s price is slightly higher.
- Do not forget that most people have a choice as to if they are going to travel or not. All to often tourism and travel employees act as if they are doing the public a favor in providing customer service. Make sure that your employees understand that most people do not need to travel and when they travel they have multiple destination options and choices. All too often all of us need to remember that tourism is a voluntary experience and when the public chooses another experience, then jobs will soon disappear.
- Show your appreciation. All too often tourism businesses act as if they are doing the customers a favor. This is the time to develop creative ways to show appreciation. For example, locales may want to develop “welcome passports” to be used at restaurants and hotels where visitors are provided with a free “extra” as a way of showing appreciation. Follow-up letters may also be sent in which the local tourism industry thanks people for visiting. The letters can even be e-letters and used as a way to encourage visitors to return for another visit.
- Remember that people love freebees even if they have to pay for them. In periods of tight markets think through how you can combine basic costs into the cost of an admission ticket or night’s stay. If hospitality is based on the idea of being taken care of and pampered than charging for extras may be a poor strategy during periods of economic downturns. An example of this short sightedness is some airlines that have turned themselves into nothing more than buses in the sky.
- Be creative and flexible when facing a crisis. The tourism industry has no control over the cost of fuel, but it does have control over how it faces this cost. For example, consider expanding your market by finding more visitors closer to home. This temporary solution may help not only the local hotel industry, but also permit retailers to weather the storm by adding to the community’s economy as tourism revenues from outside of the local region begin to fall. In areas where there are geographic limitations, such as many island destinations, develop creative pricing, along with creative airport hospitality. Get travelers to forget the woes of travel as soon as they deplane by the use of creativity at entry points, at customs stations or at passport control. Also do not forget that the last impression is often the lasting impression, so consider being creative when people leave a destination. For example hotels can give a restaurant coupon to departing guests, passport controls can hand out a come back soon brochure or gas stations can offer a free cup of coffee-for-the-road. The cost of the item is a lot less important than the memory and positive word of mouth advertising that it will create.
- Think of your tourism industry as an integrated whole rather than as a series of independent components. Additional travel costs mean that visitors will be seeking ways to economize. Visitors do not see their tourism experience separately as hotels, restaurants, transportation and attractions, but rather as a unified experience. The tourism industry now needs to do the same. Each of tourism’s components needs to be working with the other sectors of the industry to find ways to increase the quality of the tourism experience despite higher prices. If visitors do not see the total experience as worthwhile, then all of the tourism industry’s components will suffer.
