By Blake Ng — 4 Mar 2020
With the recent bushfires in Australia, locust plague in Africa, and the spread of the novel coronavirus worldwide, travel bookings are at rock-bottom. We are at an economically challenging time, and some even assert that we are heading into an economic downturn or recession. It’s a very tough time for those in the travel industry; however, panicking won’t do any good at all. Instead, it’s highly-important to focus on the things that can help your tour business survive in this time of extreme crisis.
There’s an old saying that goes, “live to fight another day”. Given this idea, tour operators must generate gradual yet effective steps to survive from this current predicament we are in.
Here are the tips to surviving an economic recession as a tour operator:
One of the worst enemies of any business venture is bad cash flow. During economic downturns or recessions, there is a prime need to minimise any unnecessary cash outflows. Think of any expenses you can cut back without compromising the standards of your company.
As almost all industries in the world have been badly affected by the coronavirus pandemic, companies may take the initiative of allowing their employees to work from home. In that very simple way, you’d contribute to the physical well-being of your employees and at the same time, you can continue with some actions for your business amidst the community quarantine and lockdown. This lessens your employees’ risk of contracting the virus, and at the same time, it reduces some expenses on your end like electric and water bills for your office space. That’s just one example of combining practicality and people-orientedness into one. These should be inseparable.
In times of international travel restriction, customers will start to search locally for hidden gems that they may not have discovered yet. This is because at the end of the day, people need to do things! We get bored, if we can’t do it overseas, we’ll do it locally. Focus your marketing efforts on these customers as casting a wider net could be a wasted investment when travel across borders is limited. Consider print advertisements in the local newspaper, public transport, or even bars. You could even target specific areas with Google or Facebook ads.
With the spread of the novel coronavirus, plenty of people who have bought cruise tickets are debating whether or not they should go, while those who were thinking of buying cruise tickets would not even go near them, even with the current low prices. This is because those people have already committed, they face the sunk cost fallacy. When someone commits early, they are less likely to change their minds. Try offering a discount for online bookings to get that commitment as early as possible.
Collaborate with other local operators in your area. If multiple operators in a particular region or industry work together, it can boost the entire region and the local economy, and could potentially mean more customers. A rising tide lifts all boats as they say! You can even support each other on the Rezdy Marketplace, and streamline processes like invoicing and commissions.
Develop relationships with local resellers. Hotel Concierges, Visitor Centres, and other resellers can often benefit the entire economy by recommending tours and activities to travelers in the area. Make sure they have your details on their desk – you could even discuss rewards for any referrals they send your way.
It may seem counterintuitive, but an economic downturn is actually the best time to be on the lookout for new talent. This is the time when a lot of great people are looking for new jobs. There’ll be plenty of brilliant guides, managers, etc. on the market. If your ship is sinking, bring a shipwright onboard to fix it.
During a recession, it may be tempting to increase your price to increase cash inflows, but don’t do it. Instead, increase the value of your offerings and the quality of your product because no matter what, a happy customer is the best marketing plan. When you go beyond expectations, even just a little, your customers will love you, they will come back to you and they will tell their friends about you. You don’t have to do much to achieve this – a small unexpected gesture makes all the difference. Think of your Uber driver who offered you some bottled water on your last trip, how did you feel?
It’s true, your numbers are probably down during this challenging time. However, it’s worth noting that following the downturn caused by the 1918 Influenza, SARS epidemic in 2003, and the recession in 2008, bookings recovered quite quickly. If you’ve got more time on your hands, prepare yourself for that rise in bookings. Educate yourself. How can you take advantage of that rise later on? How can you improve your products? How can you make your business more efficient?
Don’t know where to start? Why not check out the toolkit section of our blog.
In times of crisis, rely on your friends and family. Create a ‘friends and family’ promo code for use in your local area. Distribute flyers, and email the offer to businesses, family, and friends to drum up awareness. Remember, people are always on the lookout for things to do.
There’s no shame in asking for help, especially during tough times like recessions. Due to recent weather events and the continuous spread of the coronavirus pandemic, many governments are offering economic stimulus to the tourism businesses impacted. If you haven’t already, check with your local government representatives or website to see if your business qualifies for any relief.
If you enjoyed this article – Tips to Surviving an Economic Downturn | Tour Operators’ Guide – then follow the Rezdy blog. There are a lot of marketing tools and resources designed with businesses like yours in mind.
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