Engaging SME Suppliers May Not Be About Technology

2008-02-10

I had an interesting discussion with the President of the Finnish Chapter of IFITT and a PHD student from the Basque region of Spain about engaging small travel suppliers, primarily tour and activity providers, in the use of new technologies to help manage and distribute products. I was saddened but still encouraged to hear that both were facing the same challenges in their respective countries that I have been facing here in Canada and more specifically in B.C.. In my ongoing efforts to promote Rezgo.com as a tour operator software solution to small tour and activity operators, I have encountered similar issues with SME travel suppliers. The biggest challenge that we all identified is the misconception that SME supplier products are “too complex” for any kind of computerized system to manage. We came to the conclusion that this was in fact a false perception and not reality. When asked what the supplier sold, how many seats they had, and how much they cost, many suppliers could not answer the question. This begs the question “what do you sell?”. We came to the conclusion that many suppliers simply have not taken the time to clearly identify what it is they offer, how to price it effectively, and how to structure it in a way that it can be sold more efficiently. Let’s take a practical example:

Scenario
Jim owns a van and he drives visitors around the city doing a guided city tour (Tour A). On the tour he stops at popular attractions. He will pick visitors up at their hotels and drop them off afterward. He has fifteen seats on his van and the average tour takes about four hours. Seems like a pretty simple product offering. The problem is that Jim also offers two other tours of neighbouring cities which he runs in conjunction with his primary city tour (Tour B & Tour C). Jim will go on whichever tour for which he gets a booking, which means if someone books Tour A first, then he can’t run Tour B or Tour C.

Issues
Which of Tour A, B, or C is the most profitable? Does Jim need to offer all three tours, and if so, do they all have to run on the same day?

Resolution
Instead of focusing on what he can’t distribute online, Jim should focus on what he can distribute online. The bottom line is that if the product is not there then people can’t book it. Focus on selling what you can in order to establish the relationship, then use the personal contact with the customer to follow-up, upsell, and build on the sale.

The Bottom Line
A web site (and a web booking system) is not the only sales channel, but it is a sales channel nonetheless. Travel suppliers should be encouraged to look at their product, simplify their offerings, and look at what they can market and sell online before dismissing their products as “too complex” for sale on the web. At the end of the day, if you cannot define what it is that you sell, how can you sell it.

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