There’s no need to discount, says Carrick
A marketing guru who was once the boss of a tour operator whose philosophy was’ stack it high, sell it cheap’ has admitted there is no need for travel companies to sell holidays at knock-down prices.
Richard Carrick, former CEO of MyTravel, told delegates at the AITO conference that his thinking on discounting has changed over the past three years.
“I have come to think that you don’t need to offer a discount,” said Carrick (pictured here).
“Don’t give too much away too often, and if you do make a customer an offer explain why, Don’t let people think you are a company that discounts.”
Far better, said Carrick, to give repeat customers recognition, a personal service, than money off their next holiday.
Carrick, president of the Chartered Institute of Marketing Travel Industry Group, also dismissed the firmly held belief in the travel industry that customer loyalty is key.
He said a study by Harvard Business School proved that companies become more profitable by focusing on disloyal customers than loyal ones. “The most profitable customers are heavy spenders, who spend money across a portfolio of brands, who are not loyal to any one particular product,” he said.
Companies should spend more time working out what customers value and stop doing what they don’t, said Carrick, but he said customer questionnaires were less useful in finding out about what the customer wants than third party reviews.
“I’ve come to the conclusion that questionnaires are largely a waste of time, and you should think carefully about how you are going to use the information before asking customers to fill them out. Most companies don’t know how to use the data they collect.”
His key message was don’t do anything unless you know what your business will get back as a result.
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by Linsey McNeill
Linsey McNeill
Editor Linsey McNeill has been writing about travel for more than three decades. Bylines include The Times, Telegraph, Observer, Guardian and Which? plus the South China Morning Post. She also shares insider tips on thetraveljournalist.co.uk
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