Firestarter. Lets Change The Guest Experience In Tours And Activities

Around one thousand tours and activity operators and supporting technology and service businesses are starting to arrive in Orlando for the #arivalevent. We will all spend the week focused on learning, networking and helping each other improve the experience the millions of guests that we all jointly have the privilege to serve each year.

Over 60 presentations by great people and dozens of fantastic workshops will all help the operators attending to improve their business. Developing relationships old and new will also create immense value for the operators participating and in turn, enhance their future guest's experiences. Travel conferences can be a bit boring; they have not changed much in the last twenty years. However, Arival stands out not just because it is 100% focused on the best part of the travel industry but also because of the willingness of those attending to share knowledge. By everyone being so willing to help each other, we can all collectively improve our guest's experiences and our businesses.

Operators who are first-time attendees, the amount of information and knowledge can be overwhelming. My advice is to focus on no more than three things that you think will have the most significant impact on your business. Make sure you attend the workshops that address them and speak to those who have experience of them and start implementing them when you get home. 

My focus this week is to start conversions on how we, as an industry, can jointly change the guest experience and how it will be delivered digitally in the future.

I want to change the current guest experience industry-wide to give the guests of today and the future the best possible experience in a way that they increasingly expect and also in a way that increases the value to the operators by a significant per cent in revenue and profit terms.

All change great or small starts with conversations, but this change also has societal level trends behind it that we need to embrace.

Sticking your head above the trenches always involves risking getting it shot off so what I am about to outline and hopefully discuss with those that can make it happen will not be without critics I am sure. I am not predicting the future, I am just identifying trends that are already here and there likely impact on our industry.

I want to set a fireball under our current industry thinking of guest experience and the value that operators gain from providing it. As you know, after a fire comes new growth. This new growth could replace what was already there, or if we follow the trends it could be significantly better!

We are in the experience economy across all industrial sectors, and we are lucky enough to have been doing for decades what the rest of industry is now trying to. That is to give guests memorable and shareable experiences. We have been doing it without really thinking about it.

Four fundamental different economic values

1. Commodities
2. Goods
3. Services
4. Experiences

These four sectors have their place in society. The trend that is happening is that services are becoming products and products become commodities. The internet just by its very nature is the facilitator of this, and the speed of transition will increase.

Experiences are where today, extra value can be created both for the guest and the operator. Other industries are trying to climb the ladder to the experience economy. We are and always have been in it, but that does not mean we will still be in it in the future!

Personalisation: Threat Versus Opportunity

The biggest threat to operators today is that of the guest experiences that they deliver will be packaged, marketed and sold digitally in a way that makes them services, then goods and eventually commodities. We cannot allow this to happen; it is not in the guest interest, or the operator's benefit. Operators if you do not personalise your experience it will eventually become a commodity. Example city free walking tours. In the customer's mind the brand has become the product. Free Walking Tours.

Commodities are price and price only. I know as, in a previous life, I used to trade them. Buyers of commodities do not care about the brand or who sells them. The nature of the internet, combined with societal changes, will take our industry down this route unless we create something better for the guest.

How do we stay in the Experience Economy?

I want the industry to think about two things.

1. Personalisation

2. Value Of Time

Personalisation is going to transform our industry; it is a societal level trend that we cannot ignore. All operators if not already, will have to personalise at the booking level and the individual guest level.

One of my own simple rafting tours is not so simple anymore. At the booking level, it has 750 different service attributes that change the booking, so when we have ten groups doing the same basic tour but they are all having a different experience.  

Attributes are things like different transport, accommodation, food, other experiences that bolt onto your tour at the booking level

That is before we get to the individual guest level where were are currently designing what can personalisation to every single guest. Things like

1. Wetsuit thickness
2. Language
3. Risk profile
4. Adventure history
5. Disability
6. Instagram suitability

So what does this all mean? Tours that have hundreds of attributes at the booking or individual level or both will have to be communicated to the customer digitally. The current technology we use to connect retailers with operators does not facilitate this. 

We also have some rather exciting data and content management issues if you scale that up across the industry. The folks at https://about.magpie.travel/ are thinking about this challenge.

Think about it. How much can you personalise a flight? They already do a bit, but it is limited, and 90% of us who travel economy usually get a crap experience. How much can your personalise accommodation? A lot more than you can with a flight, but it is still not hugely different. Now think about how many different experiences we the industry already provide and how many different ways each of those experiences can be personalised at the booking level and the individual level! That is one very very big number, and that level of personalisation is strategic gold with regards business.

Of course, I am not the only one thinking about this. Read what Johannes Reck CEO of the industries most funded company has to say about guest customisation at https://inside.getyourguide.com/blog/2019/10/21/why-reinventing-experiences-will-be-the-future-of-tourism

Guests do not believe or act in terms of markets, but we segment them and place them in markets. I repeat what I have written about before

Those in the industry that will thrive in the future will stop responding to the market as virtually all of us do now. They will thrive by changing how the market works. They will make the competition look like dinosaurs by changing the market from one market to millions of markets on-demand providing personalisation at scale.

The above is a mountain of a challenge, but the opportunity value more than makes up for it. The change required in thinking not just from those of us who provide the guest experience face to face but also from all of the technology service providers and other services like marketing agencies that support the operators will not be an easy one. Still, I believe we do not have a choice.

Those much smarter than me are going to have to design guest digital experience platforms. New levels of technology that delivers personalisation at the individual level. Various routes to doing this via wearables, phones, new platforms for brands or by the internet of things. Read about what Carnival Cruises are doing and then think about how we can build the same for tours and experiences https://venturebeat.com/2019/05/23/carnivals-tiny-ocean-medallion-wearable-brings-tech-luxury-to-cruise-ships/

I now want to discuss something that we can all do something about easily.

The Value Of Time

If guests value experiences more than services, products and commodities, then it is rational to expect them to be willing to pay well for the experiences.

I am personally hugely guilty of not charging enough for what we deliver to the guests. Scots by our very nature are canny, but that can stop us putting a real value on what we do. I believe the whole industry is undervaluing the experiences we are delivering for guests.

As I sit writing this in the muggy heat of the home of one of the most significant experience providers on the planet Disney it has been fun and shocking to have done a short financial exercise.

The driver is that people pay to save time in services, products, and commodities, but in experiences, they pay to spend their time having and experience and they are not focused on saving time. The class the time they spend on experiences as well invested. We are all designers of tours and experiences that are essentially designing how people spend their time

Price per minute of an experience

Going to the movies $0.10

Disney $0.20

My own most popular experience if not amended by attributes or personalisation $0.35

My personal multi-day life-changing experience $0.14 ( This way of thinking is starting to hurt)

So I have designed and delivered totally immersive life-changing niche experiences for people that they will never ever forget and I have charged them $0.14 a minute. Just slightly above going to the movies and well below a volume mass experience like Disney.

Do operators have to ask where do I compare? How valuable is my experience?

Once you calculate where your experience is the question then arises: Is that where you want to be? Do you think you are a better experience than that?

If I am correct, maybe you are not charging enough? I know I am not. How are you going to show the value that is there?

Remember we are in the experience economy and people will pay for investing their time in an experience that rewards them individually and emotionally.

The evolving discussions about yield and revenue management that I believe can make a difference to the value of time https://www.trekksoft.com/en/resources/webinars/revenue-management-complexity I also believe it is secondary to just the simple act of getting our pricing to respect the value of the experience we deliver.

If customers value experiences more than anything else why do we spend so much time talking about discounts? We should be discussing the added value to enhance the experience.

Personalised experiences are not the end of this journey there is a higher level customer relationship to be attended and that is transformational experiences. More on that in a later article.

If you are at #arivalevent this week and want to discuss these ideas and how we can start to make them happen do get in touch. If not at the event but interested in a discussion I am always happy to have a skype or video chat.

As always I hugely appreciate if you have read this and welcome all input even if you bring a fire engine!

Pete