Partnering with Resellers: How to Rethink These Relationships
Updated: July 14, 2017 | Resellers | Share on Facebook Share on Twitter Share on LinkedIn
by Matthew Hoenstine, Principal, Destinations
Resellers have been an important part of the travel industry for over a hundred years and continue to play a vital role in driving visitation for attractions. However, as is customary with technology, it has introduced the opportunity to rethink business relationships.
The origins of travel resellers
In 1841, businessman Thomas Cook organized his first excursion and gave birth to a powerful segment of the travel industry: the reseller market. In the mid-1800s, organizing travel for 500 people to go 12 miles was a daunting task and rightly required an entrepreneur like Cook to enable it. Fast forward 176 years and that same trip now occurs every 15 minutes and is easily accessible to the masses.
The reseller or authorized seller niche was born out of necessity to provide information and coordination to a very fragmented and separated population. It was difficult for Cook’s customers to organize themselves and secure mass transit. The burgeoning road warriors in the U.S. had no idea where they might find a hotel on their road trip from New York City to Washington, D.C.
Today, information is readily accessible. Your attraction is now a mere click away from your potential guests. This significant technological shift has provided the perfect opportunity to rethink how you do business with resellers such as online travel agencies.
To embark on this new frontier, you’ll want to have a complete grasp of what your attraction offers, who you’re already reaching through your own marketing, and how resellers can enhance and complement your overall efforts.
What does your attraction bring to the party?
I recently met with a visitor services manager that was excited about working with resellers to drive visitation to her attraction. My initial guidance was to make sure she understood what her attraction had to offer and who she was already able to attract. Her goal of reaching out to the reseller market is to net out more visitation and more revenue to fund the mission of her organization. Without a clear understanding of her starting point though, she won’t have an effective way to measure the results of her resellers.
My use of the word attraction is purposeful to help reinforce the point that the experiences, venues and encounters we create naturally attract individuals to want to take part in them. While each attraction will do this to a varying degree, it is an innate quality in your offering. As such, you need to have a clear understanding of what “natural attraction” your brand and own sales and marketing efforts achieve.
This can be measured in many ways: direct ticket sales, website visitation, social media following, impressions and conversion of online marketing. You then can compare this to your goals, or the market in general, to determine where there are opportunities for a reseller to complement your efforts.
Your needs are likely a bit complicated. If you are naturally selling out seven days a week, year-round, you’re going to look at expanding or modifying pricing, not adding resellers. Most likely there are periods of time when visitation dips and the typical consumer you target – such as school groups – is not available. In those situations, you may need to fill the gap by targeting a new group of customers.
By wrapping your arms around your current offering and the areas where you need help, you are better positioned with facts and the proper frame of mind for evaluating what the reseller offers.
How does the reseller enhance your offering?
Armed with this keen insight, you’ll want to understand what impact the addition of resellers is to your business. Oftentimes these new partnerships are perceived as zero cost. After all, you’re only paying commission on a ticket sale that you wouldn’t have gotten without the reseller.
However, without appropriate due diligence as outlined above, you may find that the reseller fishes in the same pond you’re already in and simply catches the fish you were going to hook anyway. For example, if you see a 15% shift of consumers that generally buy from you now buying through a reseller who you provide a 20% net rate to, you’ll need to increase visitation by 5% in total just to break even.
What consumer does this reseller reach?
You may find that a specific reseller helps you sell in an international market that you currently have no representation in, or that they are very broad and canvas the world. Additionally, some resellers focus on specific niches like schools or employees of a business. How is this the same or different from the consumers you reach directly?
Where in the planning cycle does the reseller encounter their consumer?
Does this reseller reach their consumer during the initial itinerary planning of a trip and thus would your association with them at that point be better off than where you currently fall? How is this the same or different from when your attraction is typically considered, is this more ideal?
How does this reseller reach their consumer?
Some resellers have very strong brands they’ve built over years that consumers trust and always check with first while others may be constantly seeking out customers via specific marketing efforts.
How does this reseller’s site perform with organic searches?
They may offer a website experience that is tailormade to work well with internet search engines like Google and Yahoo. Does their site help fill a gap that you currently have with yours in respect to organic search?
How does this reseller leverage paid search?
This may be a key driver for how the reseller attracts consumers and may quickly make your direct efforts more difficult if you begin to compete with them for the same searches.
What forms of marketing does this reseller use to attract consumers?
Do they use radio, TV, billboards, brochures, internet banner ads or direct mailing? Are these efforts reaching consumers where your efforts currently cannot? Do you believe their marketing will help generate more awareness of your brand and result in sales directly with your attraction?
Does this reseller gate the availability of all or some of their product offering? If they do, how do they effectively control this?
Some resellers focus on exclusivity that services a specific niche. For example, a membership club might offer their members access to exclusive products. It is important to know if this truly remains exclusive or if the reseller allows transferability of products and, in reality, allows anyone to purchase. Well-meaning exclusive/discounted products in niche channels can quickly undercut other higher-yielding products when not appropriately segmented.
What is the reseller’s brand promise?
Is their brand promise in harmony with your product design and distribution methods or does it conflict? If their promise is the lowest-priced product anywhere and your plan is for a consistent product and price offering throughout all distribution channels, you will be at odds on day one.
How will the reseller promote or feature your product?
Most likely you will not be the only product that the reseller offers so it will be vital to know how it will be featured in their assortment. Are you required to assist with this through coop-marketing efforts, promotional payments or exclusive/promotional products?
What terms does the reseller require for offering your product?
What commission levels do they require? Are there coop-marketing funds you have to provide? And/or do they need to purchase on a credit line?
What considerations should you have mind in when working with resellers?
Establishing a new relationship with a reseller is an exciting time. The idea of improving distribution to a segment you couldn’t reach before holds much promise. However, as with any new relationship, you’ll want to be mindful of a couple potential challenges.
Consumer fraud is the first area of concern. Historically many travel resellers have operated on a voucher system where they provide their consumer with a voucher that is exchanged at your attraction for the actual product (e.g. ticket). These vouchers have transformed from difficult-to-reproduce custom vouchers to easily duplicable email-delivered PDFs. In these situations, I encourage attractions to leverage their ticketing system and interact with the reseller in digital ways to facilitate the distribution of tickets. For example, when the reseller makes a sale, electronically send them the ticket to provide to their consumer or have an order automatically created in your system for the guest to retrieve when they arrive. Not only does this reduce the potential for fraud associated with vouchers but it simplifies your operation as the controls you already have in place for ticket fraud are leveraged.
Guest service is key to ensuring success. Ultimately someone that purchases a ticket for your attraction from a reseller is intending to be your guest. Their purchase is innately tied to your brand. It is critical that your reseller understand that and deliver the level of service that you want associated with your attraction.
Most consumers have only cursory knowledge of how buying, receiving and using tickets works for attractions. As a result, it is important that our resellers make the process as smooth and understandable as possible to the customer. This helps avoid consumer confusion and reduces operational challenges on your end.
If the reseller issues vouchers, is the redemption process understood by the consumer? If the consumer has a question about the purchase, do they have a way to get assistance? Additionally, do you need to consider wayfinding or process changes at your attraction entrance to properly support them?
You’ll want to button-up your processes onsite with all departments vested in your reseller program. Your sales and marketing team manage the exposure and positioning with the reseller. Your finance and ticket fulfillment teams handle the fulfillment and billing of the sales. And your entrance team often is handling all levels of support. Having all key players from your attraction involved from the beginning can help you most effectively manage these relationships and the results of your efforts.
Ensure your relationship with resellers is a win/win/win
Increasing your attractions scope and reach to consumers is critical to driving visitation. And the industry definitely has strong resellers to deliver on that. Haste often comes before diligence in engaging with resellers and sacrifices are made on your part and in the consumer experience. Ensure that you create a win for your consumer, a win for your attraction and a win for the reseller with these key points:
- Leverage data and current results/performance at your attraction to know where you are starting from and what opportunities there are for growing your distribution.
- Seriously consider what the reseller is offering and ensure that it complements your offering and does not offer redundancy.
- Avoid surprises or challenges that arise from this additional distribution opportunity with careful planning with all key players.
Thomas Cook Group