In the mature, fiercely competitive corporate travel market, ‘Loyalty Moments’ and superior service make all the difference.
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Entrepreneur: Andrew Ross, Founder and CEO
Company: Travelforce
Business type: Corporate travel management
Founded: 1976
Employees: 30
Turnover: (2002 - 2003) $45M
Head office: Sydney, Australia
Contact details: +61 2 9262 3666
The Travelforce Story
Andrew Ross’s company, Travelforce, has focused on corporate travel since the late 1970’s. Ross decided to specialise in the market niche soon after the company was founded, believing that corporate travel had the potential to produce high revenue yield. Business travellers, for example, tend to travel business class rather than economy.
The strategy has paid off. The market for corporate travel management has grown substantially and Travelforce has grown with it. About 90% of the company’s revenue is from corporate travel; the other 10% is derived from general travel business.
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Key learning points:
- Customer relationships - All customers must know your business, like it, and trust it. All relationships with customers and decision makers must be based on these three points.
- New business - Seek ways to increase contacts with clients’ organisations. Make sure that you know who the real decision makers are.
- Financial planning - Develop a good relationship with your bankers. Never forget the importance of the bank. It has ultimate control over a business.
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But corporate travel is now a mature market and, consequently, a fiercely competitive one. Growth now depends on developing stronger relationships with existing and prospective customers. Superior service and valued-added offers are the standard in the industry.
Ross, who owns Travelforce with his wife, Mary-Lou, the company’s executive director, says: “We look after about 150 companies covering a wide range of industries and they spend anywhere between $50,000 to $5 million a year on travel. We provide all the basic core activities such as reservations, ticketing and itinerary. But we also need to add value. These days that requires considerable technology offerings. We have embraced the internet. If a ticket is issued this morning, for example, this afternoon our customers can see any information related to that transaction on the web site.”
One value-added service that Travelforce provides is a worldwide employee tracking service. This allows a client organisation to access all the ticketed and even unticketed itineraries of its employees, including details on hotel accommodation and contacts. Travelforce also reports back details of travel spending to customers, providing graphs and reports so that savings can be measured.
Ross says that offering superior service is the key to customer satisfaction and is also central to how Travelforce differentiates itself from competitors. He says customer service issues are constantly discussed among employees as well as at the company’s twice-weekly staff meetings. It’s standard practice for Travelforce representatives to ring travellers when they return from a trip to find out how it went. This gives the customer a chance to see the company’s after-sales service and also provides Travelforce with immediate product update information.
Part of achieving customer satisfaction is having the right staff. Ross says: “We always strive to employ experienced people. Mistakes in travel can be very grave. Everyone is going to be inexperienced at some stage but we take the attitude, better they practice on someone else’s clients. We look after our staff, we pay well for the travel industry and we provide good office conditions.”
The company offers monthly rewards to its employees for what it calls ‘Loyalty Moments’, those opportunities to improve or deepen the company’s relationship with customers. Ross says: “These days, loyalty is hard to retain because people have so many offers made to them from different angles and business channels. Often, the secret is recognising Loyalty Moments. It might be recognising a customer in public or securing a testimonial. Even a complaint is a Loyalty Moment, because it is an opportunity to build a relationship. Rather than running away from it, it is better to work with that person.”
Ross says a common mistake in the highly volatile travel industry is overestimating forecast sales. Terrorism is a constant concern, which has led to fear of travelling, increased costs and delays at airports and terminals. Other international factors such as the war in Iraq, SARS and the recent bird flu outbreak in Asia have also dampened sales in the sector.
“All you can do is cut your costs where you can and try to avoid having a single dominant customer,” Ross says. “In planning, you can no longer assume that your business is going to grow. Some things are out of your control.”