Three Strategic Planning Tips For Travel Companies and Travel Affiliate Marketers

As the travel industry meanders through the dog days of summer, many strategists in travel companies far and wide are already beginning to think about the strategic planning season that lies just ahead, and ponder about the profound differences this year’s process is likely to entail compared to years past.

Faced with arguably the most uncertain and volatile economy since the Great Depression, many corporate executives and strategists now realize that the ‘game’ is on the line, and that there will be real ‘winners’ and ‘losers’ – not just in terms of market share, customer ownership or profits / losses, but rather the near-term survivability of their firms. One doesn’t have to look far to find travel companies being run by their management teams more like corporate turnarounds rather than on a ‘business as usual’ basis – British Airways, American Express, Hertz, RCCL and Travelport are just five of dozens of similar examples.

The business landscape facing the travel industry today is one that has undergone a radical and wrenching change from that of just 18 months ago. Most of the ‘winning strategies’ that worked then don’t work now. More importantly, tomorrow’s competitive environment will also most assuredly be different from that of today, and that future environment will bring with it huge upside rewards for those who are properly prepared, while also peppered with huge downside risks and certain catastrophe for those that are not.

Even in such profoundly uncertain times, strategic planning doesn’t have to be a ‘hit or miss’ proposition for travel companies. Single-point strategic forecasts based on trend analysis, or strategy formulation based on past / current linear trend-extrapolation that produces base, upside, and downside cases, among other methodologies, simply do not work when the travel industry – and the world’s economic order – is in the throes of radical (and likely permanent) restructuring. While such traditional, ‘tried and true’ strategy formulation methodologies fail in times like these, there is another strategy tool that actually helps large and small companies alike develop a clear map to help navigate uncharted waters – scenario strategy planning.

What scenario strategy planning is – and isn’t

At its essence, scenario strategy planning is about identifying and understanding the forces that are sculpting the world around you; qualitatively and quantitatively assessing the potential inter-play among these forces in a structured manner; delineating from these forces several probable and highly plausible ‘future completive worlds’; and – here’s the most important element – unlike the aforementioned single-point or ‘case’ related strategic plans, scenario planning enables the design of a fluid, ‘multi-dimensional’ strategy that effectively enables companies to better manage their core business irrespective of the future competitive landscape that may evolve.

In the force identification phase of this process, some forces are determined as certain and others classified as uncertain; it’s the interplay of the uncertain forces that drive differences in the future scenarios. Altering the combination of those forces renders different future scenarios, which while one may be more or less probable than the others, each is qualitatively different.

Each future scenario paints a picture of a distinct, but plausible, business environment 3-5 years into the future, and each is written in such a way that the scenario has ‘decision-making utility’ – i.e., the future world described provides enough detail and specification so that alternative strategic courses of action can be effectively tested.

Generally, most scenario strategy planning methodologies suggest that strategists craft 3-4 future scenarios, as fleshing-out 5 or more scenarios results in a very laborious process, with derived value decreasing as the number of scenarios goes up. Together, the 3-4 scenarios span the realm of plausible future competitive worlds.

In a nut shell, travel companies and travel affiliate marketers will derive three major benefits by incorporating scenario planning into their annual strategic planning process:

Understand how the travel industry’s competitive landscape may evolve and what impact and implications this future may hold for your business
Recognize the real possibilities and significant impact of discontinuous industry change driven by exogenous or endogenous forces and events
Crystallize steps management should take to successfully prepare for these potential future worlds

While the fundamental precepts of scenario planning are relatively standard, there are several approaches to scenario strategy planning, and each has strong and weak points. Here are three planning tips that travel suppliers and travel affiliates should consider incorporating in their scenario strategy planning process regardless of the methodology they decide to use.

Tip Number1: Look beyond the past…and today’s crises

Given the depth and scope of the economic, societal and political change now under way, it is easy for travel companies to be overwhelmed by the intensity of the current situation. Focusing on just the current reality can be devastating, as it sets-up the possibility for a company to be blindsided by other forces or dynamics that lie outside its traditional competitive landscape.

Think about this point from the following perspective: If management at the world’s airlines were looking closely at what was going on in the credit markets between 2003 – 2007, perhaps many would have noticed that the plethora of M&A, privatization and other financial transactions were being fueled by the enormous leverage investment banks, private equity firms, hedge funds and others were piling-up on their balance sheets. They would also presumably have realized that maintaining leverage of that scale was fundamentally not sustainable long-term in any industry, not just the financial sector.

For airlines dependent on premium traffic, a fall-off from those heady times in the financial markets would translate into a meaningful drop in the number of premium travelers the airline would carry, and that in turn, would have a rather detrimental (if not very devastating) effect on yields. This is what happened beginning in mid-2008 – but in spades – and as a result, today many of the world’s largest airlines are reeling, and in some cases, a step or two away from insolvency.

Tip Number 2: Refrain from parochial thinking

Parochial thinking (i.e., believing that because of one’s sheer size, market clout or abilities, an enterprise can singularly drive and determine its or its industry’s future) is where many companies go wrong in their strategy formulation and ultimately fail in the marketplace – Pan Am, US Steel, the US automobile manufacturing industry (and indeed many of the ‘too big to fail’ companies) are good examples of the calamitous results engendered as a result of parochial thinking.

So, when developing end-state scenarios, strategists in travel companies should assure that each future competitive world that is constructed has been done so independent of the firm’s actions or control; this forces organization to not only recognize the possibilities of exogenous discontinuous change occurring, but more importantly, it also helps to guard them from sharing the same fate that befell the formerly iconic brands mentioned in the previous paragraph.

Even if your travel company has Google-like market share or power, failing to heed this scenario strategy planning axiom can quickly lead to market share losses or competitive erosion as other, less hubristic companies and players out-flank you.

Tip Number 3: Intensify monitoring and refinement

The effectiveness of any strategy depends on the organization’s ability to implement it and make adjustments nimbly and methodically when needed. This is even truer for scenario strategy, as by definition, scenario strategies are not static plans; they require continuous refinement and recalibration based on what’s happening in the market and the world at large.

In addition to formulating a core multi-dimensional strategy, scenario planning also calls for developing ‘hedge strategies, i.e., strategies that are developed to enable the company to rapidly adjust its strategy should an alternative future scenario occur. Some of the hedge stratagems address less probable, but nonetheless plausible, scenarios which are triggered by a sudden and disruptive industry event. Hedge strategies are typically ‘put on the shelf’, to be used only if one of the less probable scenarios evolves.

Knowing when to turn to hedge strategies requires that the travel company or travel affiliate marketer closely monitor and measure the competitive playing field. Only by diligently and relentlessly monitoring the performance of suppliers, customers, and competitors, as well as understanding the subtle shifts in the company’s other key market indicators, can any company succeed in making ongoing, real-time adjustments in their strategy, compete effectively in the marketplace and avoid being subsumed or eviscerated by disruptive change.

As we’ve all witnessed during the last year, even the most entrenched incumbents in an industry can plunge into a financial abyss literally over night because of a sudden but drastic discontinuity in the competitive playing field – hello Bear Stearns, Lehman Brothers and AIG. It’s fair to say that, given their size, resources and clout, none of these firms foresaw a world where they were not in some appreciable control of their destiny, and none had hedge strategies in place should an event of enormous discontinuous change befall them. Drawing parallels from the devastation wrought on these and other firms in the financial markets as a result of discontinuous change is reason enough why hedge strategies should be a critical element of any travel affiliate’s or travel supplier’s strategic plan.

Moving Forward

In closing, while the travel and tourism industry’s long-term prospects remain promising, all of the various players in the industry’s value chain will be challenged in the short-term. Scenario-based strategy development helps company executives better understand what the future may hold for their business and anticipate many of the required changes to their value-added focus. Incorporating these three strategic planning tips outlined above will help assure that your company’s ‘multi-dimensional strategy’ is robust enough to successfully navigate a profitable path to the future when the recovery finally arrives.

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Important Things to Keep in Mind When Choosing a Travel Company

Life seems to be very busy these days, citizens can barely take some time to relax or travel to some beautiful places in the world like Europe, Australia, America or Hawaii to name a few. However there are some individuals who care more about traveling and exploring local and international places. So if you are the kind of person who enjoys exploring life by visiting places then this article is really for you.

Traveling is one of the greatest experiences you could ever have especially if you do it with your family, friends or someone special. However things wouldn’t always go your way especially if you are not aware about the do’s don’ts when traveling. Therefore, it is really important that you have an idea about traveling, and one of the most essential things you should consider here is choosing the travel company where you can book your flight.

With the tight competition in the travel world, some new travelers find it hard to book their flight. But there are several things to keep in mind to get rid of that issue, such things include:

• Find out the reliable travel agency – before you give your trust and book your flight to any travel agency, you need first to know if this particular agency is reliable or not. To find out agency or company’s reliability, you can check reviews or consumer’s report online. So far one of the best travel agencies that have proven its credibility is expedia.

• Know the travel agency’s policy – some individuals upon seeing a travel agency just immediately book their flight without even checking the company’s policy. It should be avoided as there are companies that let you pay for nothing, like if you want to cancel or change your flight schedule due to some important reasons, some travel companies will require you to pay for that which is really frustrating. These companies should really be avoided. On the other hand there are also some travel companies that would not ask you to pay exchange or cancelled flight. Travelers stated that Expedia is one of these companies. You better check out though.

• Be aware about the travel company’s offer – in the travel world there are a lot of great deals being offered but unfortunately some of them are just half truths. When checking offers of a travel company like expedia, make sure that you inquire the whole thing you need to know. And another thing, also make sure the availability of the offers that the agency is providing. Currently expedia coupon flight is one of the reliable companies which offer great travel deal. To ensure you better check it out.

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How to Choose the Best School Travel Companies

If you are charged with organising a school trip but are not familiar with the various school travel companies out there, you may find it somewhat overwhelming. You must compare and contrast what each has to offer, and in doing so will have to filter through a lot of information.

Your job will, however, be a lot easier if you keep the following in mind.

A Long and Prosperous History

Staying in the business for a long time is one of the most reliable indicators of a decent company. This is because the school travel industry relies heavily on repeat business, and only trusted and reliable companies that provide quality services can woo customers to stay loyal for years on end. A decade is a sound history, and companies that have been around for 20 years or more are the ones that really have their game together.

Clear and Concise Itineraries

Another mark of excellent school travel companies is the ability to create an itinerary that will show you exactly what your students can expect while on the trip. The more detailed the list of activities is, the better. This will allow you to better manage your time, while levelling the expectations of both parents and students. It will also help you determine just how useful the trip will be in helping enhance the student’s learning and understanding of the world around them.

Abundant Pre-Trip Information

Travel insurance, booking information, travel information, details on the party leader, price quotes, call-backs, insurance documentation, health guides, safety guides, newsletters, a section for frequently asked questions – these are some of the more important snippets of pre-trip information that will help you better prepare for a potential trip. Quality school travel companies make sure to provide this information (and more), as it helps inform potential clients about what the trip will entail while simultaneously streamlining the application process. In short, abundant pre-trip information will better prepare you for the trip ahead.

Responsive Support Channels

It is one thing to look at a website – to read its contents and sift through its FAQ. It is quite another to have another human being actively answer your questions through emails or in real time through voice chat. Decent school travel companies know this, which is why they put up extensive support channels that put you in touch with a representative to answer whatever queries you may have.

Fair and Competitive Pricing

This is simultaneously one of the most important and one of the most underestimated aspects. The better companies make sure to provide quotes that are a) justified by the contents of the travel package, and b) are relatively similar to the quotes offered by competitors. Be very careful of the ones that severely undercut the competition while offering the same amenities. Finding out that the accommodations and transportation are sub-par – or even non-existent – is the last thing you want to happen when landing in the airport of a foreign country.

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