The current COVID19 situation has made a huge impact on the world economy, and due to the partial/complete lock on various countries, it is one of the toughest time for all travel businesses. From Airlines to Hotels to Cruise operators, to travel business agencies to inbound/outbound tour operators, every business is disrupted. No need to say why? you know the public health concern spirals and advisory issues are encouraging people (indirectly forcing) not to travel.
Numbers might look scary here, but the IATA body estimates the total loss to the industry in a range of about USD100 bn. The Travel Industry employs 1 in every 10 people when it comes to jobs, generating USD 5tn+ in revenues.
What are the Potential Risks in front of Travel Business Agents?
Going by the current situation, the industry has been at risk due to the imposed travel restrictions; that resulted in the cancellations of travel plans in both business and leisure travel segments. The most important thing to consider here is that it is just the beginning; there is uncertainty looming in the future and we don’t know when it is going to end.
As a major impact of Novel CORONAVirus (COVID19), Travel business agencies are flooded with requests for cancellations, refunds, and rescheduling in case of no refunds. Unfortunately with many of the travel itineraries being nonrefundable in nature and cash flow issues at the supplier’s end, the middle man is facing most of the heat especially where the bookings were done by the Travel Agents on credit.
Both International and Domestic travel restrictions might result in some of the players shutting shop or temporary suspension of the operations. It would be a huge challenge for the medium level player to continue paying salaries on time to the team, especially when no future business is happening.
“We do not know how long this situation will persist and cannot foresee when things will improve,” One of the customers I spoke to, who had plans to invest in the technology big time. However, one of the interesting things which we observed during discussions is that any of the investments done in the past of the digital transformation or process automation are paying off now because it helped them operate with full efficiency during the COVID19 outbreak and during the lockdown.
How Travel Businesses Can Survive and Excel During COVID-19
Based on the discussions with a few customers, below is a guide that you may refer to survive and excel during the tough time of COVID19 and LockDown:
1. Plan Digital Transformation- It’s time to be visionary, plan for the future, what could have worked better in any such situation i.e. Sitting up process, process automation, control on the workflow, online bookings, CRM tools, etc. Invest time and effort in thinking of a plan which could help you survive during any such natural calamity or unforeseen situation.
Though this is a global impact, it might look easier to accept that everything came to stand still but assume a situation if it had been a problem only with your native location (i.e. your customers and international locations open to travel/commute, etc), would you be in a position to survive and manage your business. If not, what setup would have been required?
Just to recall, during the biggest crisis of 2008 (Lehman brothers crisis), the world’s best startups (Uber, Airbnb, slack, pinterest, whatsapp) have been started. Think what change you can bring!!
2. Bring Back your customers. Over a period of past few months/years, if you had situations where you lost customers to OTA/other players, this is a golden time to win them back. Especially if they are stranded and helpless. Convey your message to customers that you are here to support them in this tough time when OTA and Airlines have their handful and are not in a position to help them, offer them a no-obligation helping hand.
3. Connect back : Offer support on booking/cancellations done via OTA platforms, create trust and prospects for future. Make it a public statement among your customers that ‘you are happy to help’; Connect with customers over WhatsApp/Email/SMS and drop a message which shows you understand their situation and willing to help your travel community.
An example could be, ‘Good Day Vivek!! This is a quick message to check with you if you are doing alright during the COVID outbreak and if you need any help with your plans (which are now disrupted); We are here to help.’; Along with a note to guide customers that you may postpone your plan rather than cancelling it.
4. No Panic: Advice your customers not to panic and don’t cancel but postpone; Share and provide information for them to make informed decisions. Help them come out of this fear i.e. Fear of not traveling. Advise them precautions and safety measures.
5. Cross Utilization: Utilize team to do different and high demand work. i.e. If the sales team is idle, they can share a load of customers’ calls and operations. Pacify customers and assure that all their payments will be safe. The sales team is the best judge of customers.
6. Build Inventory/Information/Knowledge – Make your team research, think and accumulate information on the destinations. Create a plan, itineraries for the unexplored destinations. New and exciting destinations which might be revenue puller. Consolidate and curate information better than others. You can make best use of this time and ensure your team also does so. Invest time in understanding your partners/competitors and customers.
7. Identify alternative but complementary Business channels: Adding to the risk mitigation and additional income sources e.g. Ancillary services around travel, Different customer segment, other services. e.g. would it have been better to have a mix of customer types i.e. not on leisure but some adapting Business model change?
E.g. a surprise vacation promotion company – Pack Up + Go opted to offer a new service for those who may be wary of traveling across the country; ‘Staycations’.
8. Keep Travel Aspiration Alive : Life is not coming to an end, this is a phase and like any other calamity, with a side effect, this time shall also pass. Invest time and effort in helping customers keep their travel aspirations alive. Identify non infected zones and figure out a suitable destination for future travel.
e.g. What better time than a lockdown to think of all the places you always wanted to travel! Make a bucket list (if you don’t have one), and start working on your next trip. If you have zeroed in on a country/city, research on the must-see and the hidden gems, places where you want to eat, where you want to shop. Get that itinerary ready. The pleasure of arm-chair travel is unique!
9. Pick up your list of BackLog tasks – Accounts, recoveries, documentation, Strategy, Sales, and Marketing tasks. Which were on hold because of no time in hand. Pick one at a time and close this.
10. Rebuild Strategy (Think as a Team) : Access the entire process of your business i.e. starting from marketing to sales pitch to operations and accounting. Which of the functions needs more time to think and redefine.
What is the weakest among all, you have got good references, good inquiries but price points are high? Why do you lose out? What % of the inquiries convert to business. So as a team, your mission is to learn from your own mistakes, consider and evaluate changes required and plan for implementing. This might include redefining the digital approach.
How can you reach out to customers when no interactions in person are allowed. How do you continue to offer services with the help of technology?
With the current cover outbreak and accepting reality, it is a good time for you to introspect and re-align yourself so that businesses can sustain the tough wave and be more productive in the future.
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