Last week's Hays Independence Group conference heard how investment online is helping stores thrive and how being independent can be an advantage in the age of the internet. Lee Hayhurst reports
Hays Travel says it has growing evidence the more it invests in building a better website the more its high street stores benefit.
Speaking to Travel Weekly at last week’s Hays Independence Group conference, John Hays, the group’s managing director, said agents no longer see the web as their enemy.
He said the group is seeing increasing use of the ‘branch locator’ facility on its website, and estimates that about 80% of people using it are new customers.
“The better we are doing in the digital world, the more people come into branches,” Hays said.
“We are seeing that without any doubt. It’s quantifiable.”
As well as improved websites, social media has also been seen to benefit stores, as well as the group’s homeworkers and call centres.
The firm is planning to launch an ‘engagement index’ for its stores to show the link between digital activity and in-store sales.
Hays has increased its multimillion-pound marketing budget for 2017 but halved the amount it spends on traditional newspapers as it switches focus to channels like social media.
Hays said this approach fits in with its strategy of personalisation and all branch managers are encouraged to use social media to project an authentic voice.
The conference heard the IG division, whose members operate 232 branches, was benefiting from being independent and flexible, and using technology to provide customers with a personal service.
Hays said more members are becoming niche players with specialisms in certain destinations or holiday types, exploiting demand for something tailor-made.
“We can control quality, choice of airline and yet still give people a full Atol,” he said. “It’s that type of business we are seeing growing and flourishing, where we have a differentiated product.”
CRM: Better system 'will help close sales'
Hays Travel agents and Independence Group members will be offered increasingly powerful customer relationship management (CRM) technology to help them know their customers better.
John Hays said the firm has six developers working full-time on the group’s databases to hone the system.
“Knowing and understanding our customers is a major point of differentiation for us,” he said. “We have always had what we believe to be a really good CRM system. Not everyone chooses to use it but having a single customer view really helps to close that sale.”
All-inclusive: Hays tips growth in challenging market
Growing all-inclusive sales will help Hays Travel Independence Group members maintain their margins as prices rise due to the slump in the value of the pound.
Managing director John Hays warned delegates that holiday costs were likely to rise by around 18% next year and that this, aligned to a likely increase in inflation, would eat into people’s real incomes and “make Britain poorer”.
But he added: “We have seen a trend for several years of a growth in all-inclusive [and this has continued] since June 23 [the EU referendum].”
Hays described the economic outlook as “challenging” but said he was optimistic.
Indie agents urged to tap into demand to buy locally
Independent agents are ideally placed to exploit increasing demand from consumers for convenience and location, Hays Travel Independence Group delegates were told.
Simon Ferguson, Travelport’s managing director for northern Europe, said studies showed people seek convenience shopping no more than 800 metres from home.
He said this explains the booming convenience-store sector in the UK, with consumers prepared to pay more for good service, authenticity and locally sourced goods.
“Travel consumers demand two fundamental things: experience – a desire for authenticity, and hyper-personalisation.
“Independent retailers are much better placed to deliver that than some of the bigger players.
“Any sort of complexity needs to involve the interaction of somebody along the way.
“And travel itself is getting more complex. You have the ability to adapt. It’s about the willingness to adapt. Bigger organisations just cannot do it as quickly.”
Ferguson described Hays’ Independence Group as like an incubator for diverse business models and said the most important thing is that agents foster their own distinct culture.
“You have the power to create a culture – a power a big organisation does not have,” he said. “You can set whatever culture you want and that is a true competitive advantage.
“You are all independent heroes; you have declared your independence. Celebrate your ability to adapt, to create special cultures in your businesses. Therein lies the secret to success.”
Ferguson cited a study by the delivery firm Hermes that found one in five people is increasing their spend with independent retailers.
He added that one-third of millennials say they are spending more with independent retailers because they value the service and quality of products.
Innovation: 'Take risks but minimise potential backlash'
Being innovative in business is more about the execution of an idea than the idea itself, young entrepreneur Josh Valman told the conference.
The chief executive of RPD International, a design, development and manufacturing firm, said innovation is purely about risk.
He said: “It’s about how we make ideas happen without blowing everything up.
“Risk is the primary issue whether we innovate or not.”
Valman, 23, began his business as a schoolboy having taught himself how to design and build robots and get them manufactured in China.
Before he had left school he was responsible for £20 million worth of manufacturing contracts that he managed outside of school hours.
He advised delegates to find ways to test their innovations to limit potential backlash.
“As small businesses, you are in control of your data, your environment and, mostly, your humans,” Valman said.
“You are better placed to adapt to these problems.”
Valman said the most important thing for agents is personal relationships.
“It’s about feeling that you actually cared when you sold me that holiday,” he said.
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