Booking Groups
WHY SELL CRUISE GROUPS?Let's compare your list with our list - we came up with 10 reasons.
1. It's easier for you to find / reach / deal with groups than client by client.
Working with groups maximizes your time / work "equation." Technology has made working with groups even easier with software and online group management sites such as Groupminder, and Groople.
2. You have a higher probability of success when you work with groups.
A group is already used to doing things together so the group would also likely enjoy traveling together. You may be able to offer a cruise at a price better than they can get on their own. Still, despite hard work, your group might not operate. Cruise lines see 40% - 70% of group blocked space canceled, usually because the group is not handled professionally. 10% of groups cancel even after final payment is made!
3. Cruise lines appreciate your group business.
25% - 60% of passengers onboard any given sailing are part of groups. The percentage really differs from ship to ship. Cruise lines would like this percentage to be even higher. Why? Because groups are less likely to cancel than individuals and because it is easier to deal with one group than dozens of individuals. Interestingly, these are the same reasons that agents have!
4. You can qualify for a group rate for a cruise more easily than with air or hotels.
To qualify for a group rate . . .
Hotels: usually 30 - 40 guests (15 - 20 rooms)
Airlines: 30 - 40 passengers
Cruise lines: 6 - 20 passengers (3 - 10 staterooms)
Thus, it takes fewer people to qualify for a group rate on a cruise and usually the smaller the ship, the lower the requirement to qualify. The requirement may also vary according to itinerary and season.
We'll talk more about lingo in a later lesson, but for now remember that sometimes cruise companies talk "berths," not "passengers" or "guests."
5. You have to spend less time selling.
When you sell to a group, much of the selling takes place among the group members - they sell one another on the idea of a cruise. 75% of group members take a cruise because a friend encouraged them to do so.
6. You can use theme cruises to attract special-interest groups.
For example, a baseball-themed cruise appeals to team season ticket holders. The cruise line may be offering the theme or you might theme it for your group.
7. You have less competition if you specialize in groups.
It's your way of setting yourself apart from other agents. You probably have at least a half-dozen groups within 20 miles of where you live that have never been approached to travel as a group.
8. Group cruises generate high satisfaction rates.
Cruise and group elements complement one another, which makes for happier clients, reinforces your professionalism, and as a result...
9. Group cruises generate new individual customers for you.
Group cruises attract many first-time cruisers because the group makes them want to cruise and the cruise makes them want to cruise again, maybe on their own. They'll want to book through you. If only 10 persons from a group buy a cruise from you every 2 years for 10 years, the group departure has generated an extra $150,000 in sales for you! So . . .
10. Groups can be highly profitable.
Groups are profitable not just because of the follow-up sales generated by individuals within the group, but also because the price is based on a commissionable rate (most common) or on net rates (especially incentives or charters). You can decide that your commission is your profit, or you can add a markup to enhance profits over and above commission. Some lines offer tier thresholds; more groups, higher commission. It's not unusual for an agent or agency to double yearly profits by doing groups. Some conventional agencies even have a special person to handle group logistics.
To become a group professional, you have to know the lingo.
Lesson 5: Identifying Client Types
When selling group cruises you will increase your chances of success if you adjust to the kind of people who will be on your group departure.
We can divide today's cruise market into 4 client categories based on time available and budget constraints.
CATEGORY #1: LIMITED TIME, LIMITED BUDGET
· Travel agents, single parents, young families with children, blue-collar workers, recent college graduates
· Represents 88% of today's cruise market
· Take 3- to 7-day cruises, with 2- to 5-day cruises growing in popularity for this kind of client
· Average per diem: $185 - 225 (all per-diems are per-person for air/sea package, based on double occupancy)
CATEGORY #2: LIMITED TIME, AMPLE BUDGET
· Doctors, lawyers, professionals, accountants, successful small-business owners
· Represents 11% of entire cruise market
· Take 10-day cruises
· Average per diem: $250 – 300
CATEGORY #3: AMPLE TIME, AMPLE BUDGET
· Wealthy retirees, senior corporate executives, wealthy overall (new and old money)
· Represents only about 1% of entire cruise market
· Take 18-day or longer cruises
· Per diem: $450 +
CATEGORY #4: AMPLE TIME, LIMITED BUDGET
· Teachers and students on school breaks, retirees and others on fixed incomes
· Represents about 1% of entire cruise market
· No average length or per-diem
· Theoretically they can take any length cruise - for example a teacher can take a long cruise, but needs to budget for it
Lesson 6: Understanding Types of Groups
THERE ARE 2 MAJOR KINDS OF GROUPS: AFFINITY AND SPECULATIVE
Some cruise lines use different terms and we'll list these alternate terms too.
1. AFFINITY GROUPS
Affinity groups are also known as special-interest, common-interest, or niche. When you think of affinity groups think SMERFs.
Affinity groups can be subdivided into 2 types: pre-formed and created for the trip.
Pre-formed affinity groups
· already exist
· are often community-based such as the Rotary Club or PTA
· can also be a "virtual community" such as high school or college alumni across the nation
For more information, take CLIA's online or live course Selling to Special Interests / Niche Markets.
Affinity groups that are created for the trip
· have no preexisting structure or organization
· can be categorized as affinity, since members of the group have something in common, for example an ad in a diving newsletter intrigues readers, who then sign up for the trip.
THE IDEAL PRE-FORMED AFFINITY GROUP HAS 6 TRAITS:
1. A COMMON INTEREST
2. MANY MEMBERS
3. A PERSUASIVE LEADER
4. A REGULAR COMMUNICATION PIECE
5. PREVIOUS TRAVEL AS A GROUP
6. A FUTURE GROUP TRAVEL EXPERIENCE ALREADY IN MIND
Not all cruise groups are affinity groups. The second kind of group is a speculative group.
2. SPECULATIVE GROUPS
Speculative groups are also known as per-capita, public, or promotional.
Like affinity groups, speculative groups can be subdivided into 2 types: general public and clients of agency.
General public groups
· Have no common interest, affinity, or connection except the trip - they can be driven by ads in newspaper, tv or radio, etc.
· Can be tied to a local celebrity such as a radio personality. If that radio personality goes beyond promoting the trip on his/her show and actually accompanies the group, that's a great example of a pied piper.
Clients of agency (via consortia, host agencies, chains, etc.)
· For example, consortium ties up space on 10 group departures, with special rate / amenities for member agency's clients. Clients may even get free special amenities just like regular groups.
· Group bookings work more like blocked space.
· Cruise lines do put a limit on the number of these per year such as one per ship, per month, per sailing.
Before we move on, let's look at some additional kinds of groups.
MEETINGS AND CONVENTIONS
Meetings are quite common onboard ships. Much less common is to hold a convention onboard a vessel, since most ships have only one large showroom and major conventions usually need two to three large spaces.
INCENTIVES
A company uses travel as a reward to motivate employees to meet goals. These types of cruises are usually rated most profitable in The Travel Institute polls. For more information, please take CLIA's live and online course, Cruising: The Ultimate Incentive.
WEDDING PARTIES
We rarely think of a wedding party as a group, yet it's not uncommon to have 100 people attend a wedding. And, of course, cruises are a popular context for nuptials. In fact, agents who specialize in both weddings and cruises are among the most successful in the business.
FAMILY REUNIONS
Family reunion cruises are more prone to cancellations, especially if an important family member passes away.
CHARTERS: COMPANY / ORGANIZATION BOOKS WHOLE SHIP TO STAGE THEIR OWN EVENT
Charter groups usually make use of smaller ships. For example, Oprah chartered a deluxe ship for her 40th birthday and invited 200 friends to come cruise with her. Charters are also booked for charity or fundraiser events.
For the rest of this seminar, we will focus primarily on pre-formed affinity groups since these groups are much more likely to "go" than speculative ones, especially if the group has a track record of other successful trips. Pre-formed groups are much easier to target and are the kind that you're most likely to sell and operate.
We'll cover many strategies and all will apply to the other group categories too.
Lesson 7: Learning About Group Motivators
WHY WOULD SOMEONE WANT TO GO ON A CRUISE WITH A GROUP RATHER THAN JUST TAKING A CRUISE ON HIS OR HER OWN?
The answer lies in understanding what motivates a person to join a group departure in the first place. Let's take a look at the seven main group motivators.
7 GROUP MOTIVATORS
GROUP MOTIVATOR #1: IT'S A GREAT VALUE
The group rates are usually better than rates available to the public. But even if they aren't, the group members may still receive many value-added benefits that regular passengers don't get. That's why you must stress value, not price.
With a speculative group, you can publicize the rate to the public in any media (e.g., newspaper, magazine, etc.). If your agreement with the cruise line is that the cruise is only for your agency's clients, though, the cruise line may object if you advertise to the general public so make sure you check the cruise line's policy. If you are working with an affinity group, you must keep the rate private within the affinity group.
GROUP MOTIVATOR #2: TO SOCIALIZE WITH FRIENDS
The motivation to socialize with friends is especially true for pre-formed affinity groups.
GROUP MOTIVATOR #3: TO MEET NEW PEOPLE WITH COMMON INTERESTS
This is especially true for an affinity group created for the trip. Being with friends or new friends also makes group members feel safer and more willing to cruise.
GROUP MOTIVATOR #4: TO HELP A CAUSE
Many group departures are fundraisers for charities. Usually the group must be registered as non-profit. A cruise line may donate a percentage per stateroom or a percent of revenue to charity. If the TC allowance is not used an additional donation may be triggered, but if a passenger cancellation occurs, some of the donation will have to be "recalled." Not all lines deal with charity fundraisers so check with the cruise line first.
GROUP MOTIVATOR #5: BECAUSE OF THE REPUTATION OF ANOTHER SUPPLIER
For example, someone who takes many escorted tours with a certain tour company will book a cruise if that tour company has a special cruise departure. In this case the tour operator is known, although the cruise line may not be. The tour company may have its own tour escort onboard the cruise ship to tend to the needs of those who bought the cruise through them.
GROUP MOTIVATOR #6: TO EXPERIENCE ACTIVITIES UNIQUE TO THE GROUP
For example, a bridge players club may participate in a tournament on a cruise or a cruise may have specially designed shore excursions for a bird-watching group.
GROUP MOTIVATOR #7: TO BENEFIT FROM ALL REGULAR BENEFITS OF A CRUISE
As part of a group, an individual will still enjoy all the benefits of a regular cruise passenger plus the many additional benefits that the group provides.
So now you know why groups cruise, but where do you find these group customers?
Lesson 8: Finding Group Customers
Here's our list.
1. Your Existing Clients
Ask all of your existing clients what clubs or associations they belong to. You might even add this question to an initial client questionnaire. You can compile the answers and use the list of clubs and associations to target new customers.
2. Your Social Contacts
Talk to your friends and relatives - the average person knows 125 - 150 people! When people you meet ask you what you do, tell them that you specialize in group travel.
3. Associations You Belong To
How many associations do you belong to? The average person belongs to 2 - 3 organizations.
4. Online "Communities"
You can make contacts in chat rooms and networking sites like LinkedIn.