Today on the More Cheese Less Whiskers podcast, we have a very interesting situation.
You may have noticed there's a little bit of a virus going around! Now imagine if your business was 100% dependent on travel and not just any travel. Not business travel or essential travel, but on vacation travel. Expedition trips to be precise, the kind of discretionary lifetime bucket list type of travel.
Your business might be in a little bit of flux right now.
So today, we're talking with Ashton Palmer, who just happens to own a business that specializes in expedition trips. We actually recorded this a week or two ago, right at the beginning of the travel restrictions. The US had started quarantining, no-one knew where this was going to land, and we talked about some immediate things Ashton could do to make the most of a situation that's quickly evolving.
I think you're going to enjoy this episode. It's a great look into some rapid responses.
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Transcript - More Cheese Less Whiskers 179
Dean: Ashton.
Ashton: Good afternoon, Dean. How are you?
Dean: I am good. Here he is.
Ashton: Thank you so much for making some time today.
Dean: Well, this is the perfect, I think scenario for this kind of set up here. Got a real thing that's going to be affecting a lot of people right now and decisions that people have to make, and I think this'll be good to go through the thought process of it.
Ashton: Perfect. Yeah, I agree and certainly there's going to be a lot of people that are impacted and so hopefully this can be useful to many people.
Dean: Cool. So let's start with you're telling me about the Ashton story so far and where we're at right now. I know you've been doing your expedition trips business for a long time, so I'd love to hear the story and how the business works and where we are right now.
Ashton: Sure. Do you want to hear a little bit about my story as well?
Dean: Yeah, of course.
Ashton: Yeah, great. Well, thank you.
Dean: Yeah.
Ashton: Thanks for asking. I grew up in a, sort of lower to middle class family in the UK and had a pretty fast paced childhood. My dad was diagnosed with MS when I was born, so he was pretty sick throughout my childhood and he passed away when I was 11. So my mom was an entrepreneur. When she had had myself and my brother, my brother was about three, I was just born, she found out that my father, who was the main breadwinner was sick and she was going to have to figure out how to do this. And back in the day, this is going back into the early seventies, of course, people didn't think that single parents could look after kids, especially women. And so the first thing the state said was, well, we'll take your kids and put them into some sort of foster care or adoption and you can figure out. And she said, "Absolutely not," probably something a bit stronger.
Dean: Right, right.
Ashton: And she said, I'm going to figure this out. And so she managed to scrape together a little bit of money from borrowing from her father who was a working class man. He didn't have much, but he had mortgaged his house and she was able to scrape together enough money to buy a small bed and breakfast hotel. And I remember the story she told me, she said when she moved in there, she had about $5 to her name and a packet of bacon and a half dozen eggs. And she ran that hotel for about 11 years until my father passed away and was just an incredible example of the hardworking entrepreneurial woman. I think it really impacted her negatively, but what it meant for me was that my childhood was pretty real as far as responsibilities, having a sick father, working mother, certainly not worse off than a lot of people I'm sure. But it wasn't the happy rosy kind of childhood that you read about in Norman Rockwell's paintings or see in his paintings, but-
Dean: Right, yeah.
Ashton: So I was really wanting to grow up fast. I didn't really like school. School never really made sense to me. And in fact, I ended up leaving school when I was just 16 because I just was not into it and I kind of left school feeling like I wasn't smart because I wasn't necessarily good at that type of academics and really wanted to get the heck out of dodge and leave England. I didn't really care for it there. So when I was 17, just about 17 and a half, I left the country and bought a one way ticket to Australia. The one thing that I had always wanted to do was to travel. And my mom was great. She would always tell me yeah, you can do anything that you want, you'll go everywhere.
And so I had been left about a thousand dollars by a grandfather that passed away. It was all the money I had and I bought a one way ticket to Australia. They have a visa reciprocation program, so people from the UK. I was able to work and live and travel in Australia for about a year, doing odd jobs, I waited tables, I did whatever I could. And really just had some incredible travel experiences and I appreciated that I didn't have any responsibility at the time. Fast forward, I met a girl over there who was American and we ended up making our way back to San Francisco and I arrived in San Francisco about 25 years ago with $5 in my pocket and some great travel stories and a passion for travel still.
And after a while we kind of decided we were going to convert that into doing work in travel because I think like a lot of people, you can end up doing something that you're passionate about, which feeds your soul for a while, but then you kind of want to do more with it. You don't just want to do it just for you. And so it was attractive to get into the travel business with the idea of starting our own company. We figured the best way to do that would be to go and work for other travel companies and learn from them while they were paying us. And took a guiding course, started doing some tour guiding around the U.S. which was great for me considering I grew up in the UK. So I was able to do a lot of the travel through the national parks and see places that I'd only seen on TV. And so it was really a great experience.
And that led to international guiding work and eventually working in this small niche of an industry called expedition cruising, which is these small ships, one or 200 passengers that go to places like Antarctica and the Amazon. And so after a few years of doing that and traveling from the Arctic to the Antarctic and a lot of places in between, we decided to start expedition trips. And that was back in 1999 and since that time I've grown the business gradually and my ex-wife and I decided to part ways just over a decade ago, 11, 12 years ago. So I purchased her out of the business and borrowed money at the time to do that and continue to grow the business. I since remarried, I have an amazing wife, Hillary, who we're so in love and so happy and have just grown the business steadily for the last 20 plus years. Now we have about 23 employees and we're turning over $25 million a year in sales.
Dean: Wow, good for you. That's a real American dream story right there.
Ashton: Absolutely. It really is. And if anyone ever says that there's no such thing. I mean, I'm obviously an immigrant. I became a citizen in 2004 when my first daughter was born. But yeah, I mean I am so happy to be an American and think it's such a great country and kind of irritates me when people say it's not. I'll get frustrated because there's great opportunity here and I'm certainly grateful for everything that I have been able to do so far.
Dean: That's awesome. Well, tell me about what's going on right now because this is kind of the unique time that we're right at the very beginning, I would say of the, everybody's right now starting to really go a little bit crazy about Coronavirus and we're two days out from the president banning European travel, started yesterday was the ban. Everything is shutting down. NBA cancels the seasons, schools are out, Disney World is closed, the happiest place on earth is closed. It's all over the news. So there's nothing for the normal everyday person to believe that they should do but panic about this. Seems like, right? So that's creating that culture of uncertainty and yes, I can imagine that the last thing on people's minds right now is getting on a cruise ship or to, yeah. So, what are you seeing and what's your assessment of what's going on right now?
Ashton: Yeah, well gosh, I mean I think like everybody, there's a ton of information out there and I think there's some people, I think I heard Joe Polish say there's some people that are watching the news 24 hours a day or as many hours as they can stay awake, and the reality is that's probably not the best tonic considering that the different news media outlets are leaning this way or that way, and owned by lots of different people. But from where I see it, there is a real concern about the Coronavirus and everything that I've read, including the information from Joe that was sent and the different things, there is a real concern for people in our population who are vulnerable, particularly the elderly and people with weakened immune systems. And so I think that it's not so much the concern for healthy people of contracting the virus, but is certainly curtailing the spread of it.
And that's what's leading to our nation and others really implementing travel restrictions in addition to restrictions on banning large groups of people from gathering, that it's leading to this response for a lot of people of uncertainty and certainly buying into the fear. And I think that what we need is to have a better understanding of what measures are being taken to protect those who are vulnerable and certainly to what should people do. And there are many threats to us. If you look to all of them every morning on a long list, you might not ever leave your house. But the reality is, at the moment this is spreading so quickly and we've seen the nations such as Italy and Germany and South Korea, China of course, take drastic measures to try to curtail the spread. But I think it's got a lot of people concerned. Now from a business perspective, it's interesting because there's definitely a slow down in many sectors from manufacturing, certainly travel and hospitality, but we're still receiving inquiries from people who are planning travel, who want to go. I think that what we need to do is create a mechanism so that people understand that the environments that they're going into are safe. Whether it's going out to eat to a restaurant or whether it's going on a trip to Antarctica or whether it's going to the movies or the mall, I think we need to creatively think about how can we assure that people are going to be safe not only for themselves but for their perhaps relatives and people that they are in their lives that are more vulnerable so they don't -
Dean: And how can we find, if you're saying, would you notice, and I'll say for people listening, too, that this is the continuation of a discussion that we started in a forum in Genius Network with Joe Polish's group. So we're both in Genius Network. This was a conversation that's been going on in Genius Network and we decided that we would jump on and record a More Cheese Less Whiskers episode about this because there's a lot of people and I think this is I think a good continuation of the podcast that Joe and Jay Abraham and I recorded last week, too, because we're certainly in scary times right now and this is having fundamental impact on your business. You're right in the heart of it. Travel for sure.
And the questions that you're faced with are, there's a lot of uncertainty around this, how long is this going to last? I mean, right now it's an issue and are we going to get to a point where everybody's all, okay, I'll clear. Everybody back to normal and then everybody's immediately starting to book travel and carry on with the things they were doing before, or is this going to be a long, gradual progression of this and who knows?
I mean, if you think about, it seems like certainly we're in, we're not going to reach the peak for everything I've read is probably four to six weeks from now, being the peak of where the infections start turning downwards and we get through the recovery of it. But in the big picture of things, this is an acute onset event that's bringing some impact into this particular situation, and if we were to coordinate off chronologically, like coordinate off in time, are we safe to say that six months from now the impact of this will be minimal and we'll be back to normal? Is it four months from now? Is it three months from now? At some point, we will get through this, we will get back to normal and things will carry on, and I think that it becomes, the big issue, the questions that you are kind of posing are, what do we do right now to kind of adjust or what could be the impact of it?
Ashton: Absolutely. And I mean, first and foremost, yes we will get through this. And storms always pass. They don't last forever. And so I think it really, for business owners who are impacted, the question is, what do we do right now in order to make sure that we can continue through a period of disruption? And I think also what, and this is continuing on from your discussion that you referenced in the podcast last week, is what ethical opportunities are there to help people in all different spectrum of society. Where there is a need for help and also an opportunity to further entrepreneurship and business, which is such a foundational building block of this country and the livelihood of hundreds of millions of people. So, it's definitely -
Dean: So, let's start with, I think it'd be a good idea then to start with putting your own oxygen mask on first. That's got to be the first thing. You've got to solidify and do the best thing for your business to survive this so that you can come from a position of security on that. And can you tell me a little bit about how your business works? The economics of it. I know you do -
Ashton: Sure.
Dean: Maybe a couple of million dollars a month, but where does that money come from and how much transaction volume does that account for? All of the basics, I would say.
Ashton: Yeah. So, we are affect-
Speaker 2: We are effectively a specialized travel advisory firm or travel agency if you want to use that terminology. We are working primarily with individuals, some groups, but mostly individuals, couples and single travelers, who are planning trips to incredible natural places, the Galapagos, Alaska,-, et cetera. We are booking travel. Typically trips, the average time between when a trip is booked to when a person travels is 10 months. We are realizing our revenue derivative of commission from the booking, at the time of departure or somewhere thereabouts. So we're building a pipeline and have been maintaining and building a pipeline for two decades, that is about a year forward.
Now here's the good news. The good news is in our business, that means we have a lot of people already booked over the next 12 to 18 months. However, the bad thing, at least with this particular situation, is that with the travel restrictions being put in place, that is preventing many of those people from actually doing those trips. So in the immediate response, what most companies are doing in order to stay solvent, is they're offering credits to people and saying, "You can travel at a later date, we'll hold onto the funds and we'll go on as normal." So in the short term that seems like it would work. The reality is in our business, we're going to have to get to a point, whether that's two, four, six, however many months in the future, to where people's confidence is back to start going about normal behavior, as you say, the word normal. Or will it be a different reality?
So that's how our business works. The average trip cost is about $12,000 per person. It's definitely a higher ticket item. Our clientele are well-traveled, well educated, well informed, they've seen things like this before. But to answer your other question, in instances where we've seen the H1N1, SARS, other outbreaks, we have seen that people have stopped behavior when it's going to a particular place. But then after awhile, once that's under control, people do return to business as normal.
Speaker 3: When you look at this right now, how many trips would you book in a typical month, let's say? Or is there a seasonality to it or is it pretty stable across the year?
Speaker 2: It's pretty stable across the year. I'd say we're booking anywhere from 80 to 100 trips a month, somewhere in there. Some months busier than others for booking. I would say that January and February, our booking rate was 35% higher than it was the previous year. And it's a lot of people traveling. March, yeah, things have definitely dropped off considerably, but not stopped altogether.
Speaker 3: This is a pretty interesting opportunity, perhaps. If you're saying that it's 10 months that people typically book out, when I look at this, the way that you guys make money is through commissions from tour operators?
Speaker 2: Correct, yes.
Speaker 3: Or do you charge a fee or a membership?
Speaker 2: No, we don't charge a fee and that's a common misconception, but that's how we make our money, for sure.
Speaker 3: Okay. So as a broker? If we think about it like a realtor would help somebody find a house, you help somebody find a cruise or like a travel agent?
Speaker 2: Yeah, like a realtor, exactly.
Speaker 3: Okay, perfect. Tour operators are the ones who are really, they've got the biggest impact on the line here, right? In that they've got to put these tours on and I imagine that they're stuck with vacancies or with... are they individual tours or are they group tours that they're running?
Speaker 2: They're running group tours. And they're in a bit of a pickle at the moment, because their ability to execute these tours is being diminished by the travel restrictions. So in fact, one of our partners and I talked to them yesterday, they've made the decision both from a social responsibility and also in order to help their clients not have to make a tough decision, they've decided to cease all operations until the end of April.
Speaker 3: Gotcha. Awesome. Okay. There's something there. So when you look at it, the good news is, for you, that you can continue organizing all through. Even though if people are making bookings for the fall or for next year, by now if you're saying 10 months, that next year is a... are the tour operators offering assurances or are they doing anything to ease people's minds that they're going to be able to travel or the fear that people are not going to be able to travel?
Speaker 2: No, I think, the immediate responses from the tour operators has been to create much more lenient cancellation policies so that people can cancel. For example, normally it would be 90 or 120 days before a trip, if people canceled sooner than that, they would lose their money, a lot of companies have moved to a 30 day model where they've said, "Look, we realize that people need to wait and see, but we don't want to hold their money ransom with the previous terms and conditions which were more strict." That's been one of the responses. And then the other thing of course they're trying to do, is to keep people booked on the trips, even if those trip dates get moved forward, then the cash flow keeps going in the interim.
Speaker 3: I gotcha. Okay. So one of the things that I was thinking about when we were discussing it in the forum, was looking at what I imagine the assets that you have in this are, and one of those being this 20 year base of clients who have taken cruises, or expedition trips, that you are the incumbent expedition provider for them. How many people do you have in what we would call your after unit like that, people who have booked with you previously?
Speaker 2: Probably about 20,000, 25,000 households.
Speaker 3: Do you do anything to measure what happens with that group year after year or, one of the things that we talk about is measuring something we call return on relationship. And so we look at this portfolio here. Of the 25,000 families that you have that are already in your family there, and over the last 12 months, how many of those families rebook travel with you or referred someone?
Speaker 2: Our repeat and referral rate is about 25%.
Speaker 3: Okay. That's good to know, because part of this is, if we take this just to help run normal numbers here, this 25,000 people, how do you communicate with them?
Speaker 2: We primarily communicate them electronically, via our newsletters, our marketing pieces that way.
Speaker 3: Okay. And do you also have physical addresses for them?
Speaker 2: Yes we do.
Speaker 3: Okay. How often would I, if I were on that list, hear from you in a calendar year? What cadence of communication would I experience?
Speaker 2: Typically if you were opted in to the electronic communication, you would hear from us about once a month, sometimes twice a month. We are cognizant of not wanting to over contact for fear of, not fear, but because people might opt out then.
Speaker 3: So 12 to 20 times a year, maybe you might send out emails. How many of the 25,000 would be opted in? If you were to send just to the after unit, the ones that have done business with you in the past.
Speaker 2: I would say that would probably be close, it's maybe 18,000 to 20,000, somewhere in there.
Speaker 3: Okay, that's awesome. If 25% was repeat and referral, that would mean that roughly 250 or 300 a year. Is that about right?
Speaker 2: Yeah, back of a napkin, that sounds about right.
Speaker 3: Yeah. Yeah. If we look at that then, how much revenue would come from just the after unit isolated?
Speaker 2: I would say, if you were to look at it like that, and let's say the average trip was $10,000 per person, the average booking being two people. So that would be the sum of 20,000 times that 300. 6 million maybe?
Speaker 3: Is that right? Yeah, about right. That makes sense. That's if you're saying it's about 25%. Anyway, so that seems exactly right. Because if it's 24 million than 25% is about 6 million. Okay. When we look at that now, this division of your business, if we treat it as a separate unit, treat it separately with its own objectives, its own of timeline, that if we look at that, and these are all knowable numbers, so I would love to see what that actually works out to be, but if it were 20,000 people, for round numbers, did we say 300?
Speaker 2: Yeah.
Speaker 3: Okay. Let's be conservative on both sides and we'll call the lift 15,000 people and we'll call it 300 people as the number of transactions. So 300 divided by 15,000 is 0.02%, right?
Speaker 2: Right.
Speaker 3: Of what we would call your return on relationship. So that's the measure that we look at here. The goal of the after unit is to manage that relationship portfolio for as much of a yield as we can. Now we went back of the napkin and established what the current state of the unit is, that that's about... and is that pretty stable, year after year, about 25% of your business is repeat and referral?
Speaker 2: Yeah, it is.
Speaker 3: Okay. So excuse me. So looking at that, the formula that we've got is that 20 contacts a year by email, turns into $6 million of business annually and that works out to be about a 0.02% return on relationship. So now if we look at this, what would you say would be the distinction between referral and repeat business?
Speaker 2: The different percentages?
Speaker 3: Yeah. Would you say you get more repeat business or referral business?
Speaker 2: More repeat business.
Speaker 3: Okay, great. How do you measure the referral element of it? How do you know that somebody's been referred?
Speaker 2: We track that in our database by referrals-
Speaker 3: So you all ask how did you find out about us? Well, Susie raved about the trip. That's really the thing that you have there. Okay. So when you look at this now, that current model, and it would valuable for you to actually do these numbers, because I'm sure you have access to all of it for the spreadsheets kind of thing. You guys have financials to be able to see what that actually is. But the part of the equation that would be amazing, is to be able to isolate the people who are power expedition trippers. Do you have a series or a segment of your list that are frequent, every year people or multiple trips?
Speaker 2: Yeah, we've definitely done some analysis over the years of identifying those clients who are frequent travelers. We don't have as great a visibility going back through the years. We have to run the spreadsheets manually, but we do have some visibility.
Speaker 3: Well, certainly, you'd be able to see, the people, I guess especially the ones that are booked in the last couple of years, you'd be able to see that they've booked multiple ones, I imagine. So part of what I was going to maybe suggest with that, and this is when I didn't know whether you were a packager of these expeditions or a purveyor of them, and it may be that you could give people the opportunity to travel, book now, but travel in the future. I'm sure there are some of these companies that are offering pretty good incentives right now for booking. Even if it's booking for next year, just to get cash flow, to get some money going. Are you seeing things like that?
Speaker 2: It was my thought exactly early on. And I reached out to all of my top suppliers last week to say, "Now is the time to be forthcoming with your best offers."
Speaker 3: Yeah.
Speaker 2: Because…
Speaker 4: With your best offers? And because I agree with you and the reality is this past week I think companies were scrambling to figure out how to respond to some of these travel restrictions and that they're dealing with, what do they do with the trips that are leaving next week. But it is top of mind for them as well and I have commitments from several of the wanting to have conversations next week, because my goal is to then obviously be able to go out to our clients and say let's, "We've been able to negotiate some amazing opportunities." And now what this does, it doesn't help cashflow in the short term because the deposits that are usually taken for these trips go directly to the companies. We don't gain any access to that. To that money, and -
Dean: I understand I'm talking to you about, I meant for the travel packagers that they were probably going to start offering things like that so that they could get some deposit money in to shore up cash to get through this period because they are probably being, they're probably feeling it more than you will in that you're just selling less of them currently. But you're not, you're not being stuck with all the expenses of actually putting on the trip for half the people. So your whole, yeah, so it's not there. I could imagine that that could be pretty deep, deep thing for some of these, for some of these operators.
Now luckily it's been a very lucrative business going for a lot of years here we've had a long runway here of growth, growth, growth for the last 10 or 12 years, especially. And yeah, so there you would hope that the bigger tour operators are going to be able to weather a short term storm like this and we will, everybody is, imagine that there's going to be some casualties, but I imagine by and large everybody will get through it, but they've got to tighten their belts and be creative and manage cash really well in that period.
Now part of the challenge is not losing twice. What happens often is that you're in a situation like what you're talking about, I noticed that on the forum you had said, "Here's what we've done so far. We've stopped advertising," because we're doing that. So now if what you're saying is that your average gestation is a 10 month period. That people are booking for 10 months out, there's probably a period where people are researching and thinking about that. That might be another several months before they actually get to the point of booking.
So that the ripple effect of what stopping the advertising now does is it really affects, not so much right now but the longer term picture. Because you're looking at the channel or the solution to a kind of acute onset right now issue. How do you, but I'm going to put the after unit aside for a second and then let's talk about the before unit, which is the getting new business side. So what kind of, tell me about your model, your advertising model for getting new business and how that converts and what the economics of it are, how much it costs you to get a new client and all of that.
Speaker 4: Yeah, we have been in the process of building a new website over the past six months and that's about three months out right now. We were tracking to finish that project at the end of April. The reason I mentioned that it's because our current website is outdated and is not mobile friendly. I don't need to get into that. You know what that means. And so we have become, and we are heavily dependent on paid advertising mostly through search. And so our primary way of obtaining new clients is through search. And also we have some affiliate relationships with different groups and companies as well where we also get leads that way. Sort of the economics of that, our marketing budget has been at about $30,000 dollars a month. And then on top of that, we also do some revenue sharing with affiliate lead production.
Dean: How much, what do you, what ends up happening with the $30,000? How do you kind of break that down? What happens from that?
Speaker 4: Yeah, so we're managing obviously major search platform campaigns through Google, Bing. We're doing some social advertising and a variety of advertising basically.
Dean: And are you sending people to opt-in pages or?
Speaker 4: We are, we do have landing pages and opt-in pages and also to our regular website as well. But this is something that we're, as I said earlier, I would we're working on changing but that's our current model.
Dean: And so do you, how many leads do you generate for that $30,000?
Speaker 4: I'd say that probably 200 to 300 per month. Somewhere in there. - Yeah.
Dean: $100 per lead. Is that about right?
Speaker 4: Yeah, that's about right.
Dean: And what are you calling a lead? Is that a phone call coming in or an inquiry about a particular trip or do you offer any, Galapagos planning guide type of things? Or what are they out of the, what are you calling a lead?
Speaker 4: Yeah, that would be an inquiry. Somebody who is responding and reaching out to us to ask for our help regarding a specific destination.
Dean: So, okay, so a phone-
Speaker 4: Phone call or an email or something else - submission.
Dean: Okay. And how many unconverted leads do you have right now? Like a list of those emails.
Speaker 4: Over what time period?
Dean: Collectively, how many? You must have, not everybody that calls in books, right?
Speaker 4: Yeah. I mean, I would say a lot. Yeah, a lot.
Dean: And so how often would I hear from you if I were one of those?
Speaker 4: You probably wouldn't. And you know what's interesting, Dean, is I listened-
Dean: Oh my goodness.
Speaker 4: ... to your presentation about the nine word email prior to this and that was very good advice. And I really enjoyed hearing about the statistics of people responding who had not been contacted. But we're in that same situation as the, I guess it was the yacht broker that you referenced -
Dean: You literally have a file called Deadly?
Speaker 4: No, no, we don't have a paper file.
Dean: That's great.
Speaker 4: But we have a lot of records in our Salesforce and also other system too.
Dean: So let me, so walk me through, so I just want to make sure that I'm on the right track here. So you're running Google ads, somebody types in Galapagos expedition. And they see your ad and your ad says, "Galapagos expeditions 2020," what would you say? You know, "Full service, lots of things to choose from, click here." Is that, I mean what would how would that go for you? What would, are you bidding on terms like that, Galapagos expedition travel?
Speaker 4: Yeah, I mean I think travel in general is destination based. People say, "I want to go to Antarctica, I want to go to California, I want to go to the Galapagos." So general search terms around destinations and certainly also our brand name and other brands that people are familiar with. So when I started the company in 1999 the internet was relatively new and I think people were looking to get to the company of origin if you will, the tour operator operates the trip.
However, now that we're, the internet is such a big forest, people are more keen to find advisors like us who can help them choose the flavor of trip and the brand that would suit them best. So actually I think we've seen an increase in people's behavior with that. But yes, ultimately we want people to contact us. We want people ideally to pick up the phone because once we get someone on the phone, we can explain to them why they should buy from us. Nine times out of 10 once somebody gets on the phone with us they do buy because they realize that they don't have any knowledge on this particular topic. And as much as you could go on YouTube and watch how to fix your electricity in your house by watching a YouTube video, it's probably not the best idea. You probably want to get an electrician. So when you're making-
Dean: So your model is then your, the 23 employees that you have are, how many of them are sort of frontline talking to people like that?
Speaker 4: Yes, so we've got nine salespeople in the office. And then we also have other people who are supporting planning the travel as well.
Dean: Okay. And I'll call those your during unit. So once somebody, like once somebody books a trip, they say, "Okay, we're going to do it," that now they're in your during unit. And that's everything to do with planning the trip, booking the trip, organizing the trip, coordinating, keeping everything on track, answering their questions, nursing it along, reminding, getting everything ready. The period of time that they would be in your during unit would be from the moment they book it until the moment they disembark. They're home safely again. That's the during unit experience.
And there's a whole series of metrics that you would look at in that kind of situation to, as a lot of great opportunities to multiply those as well. And a metric that we would look at in your during unit would be your, let's call it your trip multiplier index. And what we would look at is that every time you book a trip, you've got the opportunity to have multiple things happen. You've got the opportunity to book somebody to come with them on that trip, other companion people. If you're encouraging them to make it a family trip or to make it a buddy trip or a couples trip or a church trip or whatever. So many opportunities to potentially expand that into multiple trips.
The opportunity to book the next trip before they disembarked on the one that they're on now, to make sure that now they're ready for the next, or even if you extend the during unit into the first 30, 60 days after they get home from the trip that they booked. But to count that as the opportunity to book another trip to keep that chain going. And then the opportunity for them to refer people who maybe book a trip at another time. And so you look at how many, and I would really sort of formalize this as a proprietary metric to look at what is your current situation of how many trips does one trip turn into. Or is it just that they booked that trip and then we send them the, we get everything handled and we send them the trip. And they go on the trip and we give them a check-in call when they get back, "How was the trip?" or whatever. And that, but it's no real orchestration of or measurement of how that becomes leveraged.
And so that's another sort of opportunity. But does that something that you have an awareness of or that you have a focus on or measure or celebrate or?
Speaker 4: No, no, it's not. And I think that's is a very good insight, honestly, because the planning leading up to a trip is, it's certainly appeared where we are engaged with our clients and I think that's a great opportunity there to provide them more offerings, so.
Dean: And what do you think somebody who books a trip, you go through the whole thing, you're planning thing doesn't they book the trip and then what story are they telling at cocktail parties and on the golf course and at tea and at work and among everybody that will listen. "Oh yeah, we're going to the Galapagos. Yeah, we're going to the Galapagos in June. Oh yes, I hear it's beautiful." All these things, their whole conversation, socially, is going to be looking for opportunities to bring up the fact that they're going to the Galapagos. People who go on expedition trips, it's a different mindset than somebody you know, going to the Poconos, a cabin for a week.
Speaker 4: Yeah, no, I think that's a brilliant point. And I, I can only imagine how much our business would've grown if we had done that for the past twenty years. But hindsight is 20/20.
Dean: But right now the opportunity, I think the asset that you have is the unconverted leads right now. Would you think that that number is more than the 15,000 or 20,000 or whatever it is that you have of in the after unit?
Speaker 4: Yeah.
Dean: It would have to be.
Speaker 4: It's absolutely, but the question would be, how far back would you go? I mean…
Dean: Well I don't, I mean, it's an interesting thing if you were to send out, if they inquired about, imagine the information you would have is that they, the record would show that they called in about a trip to the Galapagos. And if you were to send simply a nine word email to me saying, "Hey, are you still planning a trip to the Galapagos?" And if it's after more than two years, if you send out a thing and say, "Hey, did you ever go to the Galapagos," something like that, just to engage with people.
Speaker 4: Yeah, I think it's brilliant. And I definitely could... I liked what you said too, about how it would be very awkward if you said that to somebody face to face. And they didn't say anything. So it is a way to get that engagement, I think. It's very clever, very good.
Dean: So the thing that I think could be a great opportunity for that is that right now you're basically saying that if somebody calls in now, they ask about-
Dean: Somebody calls in now, they ask about and are told about whatever they've inquired. And does most of them book that trip right then on that call, or is there some -?
Ashton: No, I mean typically, people, I'd say that the lead to booking process takes about, on average, is seven days.
Dean: Okay. And then, do you know or measure what your conversion rate is on the leads?
Ashton: Yeah, I'd say about 30%.
Dean: Okay. Wow. And then the ones that don't, they just kind of drift away or is there some ongoing sort of outreach-
Ashton: Yeah, I mean, we have-
Dean: Or do you only send emails to the after unit?
Ashton: Yeah, we did definitely have a followup process. I think it's three or four different follow ups that we follow over a period of time. But then beyond that, we don't engage further once we consider that sort of a dead lead, if you will.
Dean: Yeah –
Ashton: A lead that didn't respond.
Dean: Right. I got you. So that seems like a real opportunity, and maybe a bit of a longer term opportunity, but it seems like kind of an opportunity that you could deploy right now is to your after units with the people who are planning, who have done multiple trips.
I think you might be able to be the solution for a lot of these tour organizers because you've got a big list of people already who you're in communication with on some level, and you could build a nice email list of people who would love to know about some of these travel deals that are going to be happening over the next few months.
It's funny how you take this Warren Buffett approach, you know, that they try to be fearful when others are greedy, and greedy when people are fearful, and that sometimes being prepared for opportunities creates a great win. And I remember at the annual meeting, Warren Buffett does his annual meeting in Omaha, and somebody asked him, "What's the best way to invest $1,000?" Somebody said, right? And he said, "Consumer durables." And they said, "Oh, okay, well what's that?" And he goes, "Well, watch the newspapers, and when toilet paper goes on sale for 50% off, buy $1,000 of toilet paper and you've made a 50% return on your money on something you were going to buy anyway, right?"
And that's a really interesting approach to it, right? Like it's something, you're going to need it, you're going to buy it, rather than waiting until you need it, pay attention and buy it when the opportunity comes. And so, if there's people right now, who the majority of people are people are doing expedition trips, if they've got money already, that there would be a opportunity for them to book something that they're intending on doing, especially if some of your clients are people who may book multiple trips a year like that.
I mean, I'm just thinking about my circle of local friends from a country club or my friends here that are retired or almost retired, that there's several of them that book, that go on a pace of two or three of these trips a year. I'm sure you know people like that, that that's what they're doing in their retirement is-
Ashton: Yeah. Yeah.
Dean: Especially early on in their 65 to 75 kind of years, right, where they're still mobile and active and whatever else. But that may be different than your demographic for your kind of trips, but if there are people who are going to book a trip later, I think you might be able to preemptively build a nice list of people that you could go to the tour operators and say, "Listen, we have 25,000 clients or we have 15,000 clients. I have been in communication with them. I have a group of a hundred people that would love to book a Galapagos trip," or book a whatever, that you could be a solution, you know?
Ashton: Yeah.
Dean: And that could be a solution for you. Like I would imagine if you sent out an email that told the situation to people, right? Like you were saying, and to explain that to people in a one to one conversational kind of way. I mean, if I were saying it to you, saying, "Ashton, you've probably seen that there's a lot of craziness going on right now about coronavirus and travel bans and who knows how this is going to play out. It's probably going to be weeks or months before things get back to normal. And the travel packagers are really being left with a lot of the burden of this because trips are a hassle and things like that, and some of them are offering really great incentives for people to book travel now for 2021."
And so saying to people, you know, "I don't know what your plans are for next year, but if you are considering a trip to the Galapagos or a trip to..." What would be the big five kind of thing, you know?
Ashton: Yeah, yeah.
Dean: You take the categories kind of thing, or the Galapagos or the rainforest or the New Zealand or Asia or whatever, probably not Asia right now-
Ashton: Yeah.
Dean: But having Alaska or Antarctica, those kinds of things, if you were to get an interest list among those people and just kind of put yourself in a position where you could be a market maker here, you know?
Ashton: Yeah. No, I think that's a great way of looking at the situation from a different perspective.
Dean: Yeah.
Ashton: And I think people would be, especially clients that have done business with us before-
Dean: That's right.
Ashton: I'm sure they would be quite willing to respond very, very easily to-
Dean: Yeah.
Ashton: To gaging interests like that. And that then -
Dean: Right, that's exactly right.
Ashton: Powerful tool to leverage. You know, it's one of the things that say, "Give me your best offer and I might be able to find some people," versus-
Dean: No, you're saying-
Ashton: "I have the people."
Dean: Yeah.
Ashton: Yeah.
Dean: Right. And that's the kind of thing, right? Like you can go out and do that. And I might use this as a way to segue into more frequent communication because I might say to people, "Listen, I know you're used to only hearing from us once a month, but I'm going to ramp that up over the next little while because these are extraordinary times."
This is a twice in the lifetime of our business opportunity. The first was at 9/11 when travel -, but we recovered from there. And you may have remembrances of what happened after 9/11. I mean, that probably put a damper on the robustness of people booking expedition trips.
Ashton: Yeah, I mean, it definitely did. Yeah, it did, but it was also a time when people, when tour operators released special officers and things like that too in order to incentivize. And so that's where, you know, it's like there's always going to be people that will be motivated by saving money.
Dean: Yeah. Yeah, and I think that there's the thing, that the thing about right now, in this moment, is that it's all so brand new. It's less than a week before since the real like ramping up of quarantines and isolations and travel bans, that the travel companies have not yet had a chance to wrap their mind around it and formulate, "Okay, we need to make some special offers here."
Ashton: Right.
Dean: And that part of this narrative for you is that as your travel advisor, I've seen this happen twice before. It happened in 2001. It happened in 2008. What's likely to happen now is that the travel companies are panicking and they need to figure out what to do to stimulate some activity. And I may even tell the Warren Buffet story in that kind of a situation, right?
Ashton: Yeah.
Dean: That, "This is your reward for doing all the right things, and you've got a chance now to benefit from that, doing something that you were going to do anyway and save money doing it. And so I just want to gather your interest around that and I'll keep you posted each week here. I'm going to keep us apprised of all the situations." And then next week you might say, "Okay, here's what's going on. I've been talking to the people from the Galapagos..." So there's the kind of thing where if you're saying we may be able to get some really good expedition trip clients only opportunities-
Ashton: Yeah. Sounds good.
Dean: Yeah.
Ashton: Yeah, opportunities. Yeah, absolutely-
Dean: - with these people booking, exploring exclusive opportunities. I mean, if there's a way, like we said, every shot make somebody happy, and that you're in that situation that you've got to take the point of view that you're looking at this as the umpire and you're realizing, without emotion or fear attached to it, that this is what's happening, what's likely to happen to get out of this, and let's align ourselves as part of the solution and see if we can't market make our way into things happening. Yeah.
Ashton: Yeah, no, I think that's an incredible insight, Dean, and we're well positioned to do that-
Dean: Yes.
Ashton: Having been in the business, in the industry for so long and certainly have great relationships with both clients and our tour operator partners. So definitely something that will be actioned in the very near future.
Dean: Absolutely. Absolutely. Well, Ashton, I can't believe it, but we've been talking for over an hour here and it just went by so quick-
Ashton: Yeah.
Dean: But I think we made a lot of progress there.
Ashton: I think so.
Dean: What's your takeaway?
Ashton: Gosh, I've got so many takeaways. I think that, you know, there's definitely some opportunities within our database for us to serve our clients better ultimately. It's not just about selling them something, it's about serving them better than we have been, both in the inquiry phase, But for those that haven't made a decision, reaching back out to those people to gauge their interest, and certainly reaching out to our database of people who have traveled and who do trust us.
Dean: Yes.
Ashton: It's a digging that well where we know there's water, right?
Dean: Yeah. Yeah. Yeah.
Ashton: And I think that I cannot thank you just enough for your insights and your generosity. I'm so grateful for your time and just for not only talking through some of these ideas with me, but I also hope that this might provide others with insights in ways that-
Dean: That's what I'm hoping too. That's my hope too. There's so many people in this situation right now that are wondering what to do. And I think that the things that we talked about would be, on a macro level, applicable to so many different businesses. So I was happy to do it. I'm glad we got to know each other a little bit-
Ashton: Yeah.
Dean: And I'm sure we'll stay connected here.
Ashton: Yeah, I'd like that. So have a great afternoon. Thank you against your time and I look forward to keeping in touch.
Dean: Thanks, Ashton. I'll talk to you soon.
Ashton: All right. Take care. Bye bye.
Speaker 5: So there we have it, another great episode. Thanks for listening in. If you want to continue the conversation or go deeper in how the eight profit activators can apply to your business, two things you can do. Right now, you can go to morecheeselesswhiskers.com and you can download a copy of the More Cheese Less Whiskers book and you can listen to the back episodes of course if you're just listening here on iTunes.
Secondly, the thing that we talk about in applying all of the eight profit activators are part of the breakthrough DNA process. And you can download a book and a scorecard and watch a video all about the eight profit activators breakthroughdna.com. And that's a great place to start the journey in applying this scientific approach to growing your business. That's really the way we think about breakthrough DNA as an operating system that you can overlay on your existing business and immediately look for insights there.
So that's it for this week. Have a great week, and we will be back next time with another episode of More Cheese, Less Whiskers.