Luxury cruise lines get better at finding new customers

Luxury cruise lines get better at finding new customers

New analytic programs are making targeted sales campaigns by
cruise lines and travel agents increasingly sophisticated and efficient,
helping to offset some of the rising costs of marketing.

The trend is seen particularly in direct mail, and
especially in pieces aimed at luxury customers.

The programs, which began several years ago, are being used
by lines such as Oceania Cruises and Regent Seven Seas Cruises to reach people
who are not yet customers but fit the demographic and economic profiles that
the lines have targeted as their market.

Nikki Upshaw, senior vice president of sales at Oceania,
said the idea is to mine customer lists from various travel partners to do
prospecting without threatening the proprietary value of the lists.

The initiative, dubbed the Travel Partner Enhanced Imprint
Program by Oceania, started in earnest in 2014 with about 25 partner agencies.
It has now grown to number in the hundreds, Upshaw said.

To use the program, agencies agree to a campaign of six
months, with mailings either once or twice a month. The cruise line pays for
design, printing and postage of the pieces, on which it imprints the name, logo
and contact information of the agent.

The agencies agree to send customer lists to a third party
that screens out existing Oceania customers.

“So Oceania never sees any data in the database that
the agents submit,” Upshaw said. “It goes directly to our third-party
partner.”

Rosemarie Reed, vice president of sales and marketing at
CruiseOne, Cruises Inc. and Dream Vacations, said the Oceania imprint program
and others like it are a boon to agents because of the cost savings.

The high-quality printing of a luxury brochure or catalog
might cost $10 a piece or more, she said, making it hard for an agency to reach
an effective number of households. The postage is also hefty, Reed said.

Supplier analytics make the mailings targeted, increasing
their efficiency. While an industry standard response rate for direct mail is
about 12%, the co-op imprint program can reach the 25% to 30% range, Reed said.

CruiseOne counts any action from the customer, such as an
inquiry, as a response. Sometimes clients don’t end up buying the particular
cruise on offer, but they ask about another product, still a win for the
agency, Reed said.

Oceania judges its program based on a stricter standard of
bookings made. Upshaw said a 1% conversion rate is considered successful, while
some outlier agencies can reach the 3% to 5% range.

Reed said the system is an improvement over the direct mail
programs of the past, in which suppliers would print more brochures than they
would mail to past passengers, a tactic called “overprint.”

“They would offer them to agencies, and all the agency
would have to pay is postage,” Reed said. “So the printing cost was
already baked in by the cruise lines.”

But the agency’s mailing list was based on its own
understanding of the line’s target market, not the supplier’s. Reed said that
in addition to Oceania and Regent, she runs a similar program with Silversea
Cruises.

Upshaw said the program has evolved as Oceania gained
experience. At the start, it was a chore to align data-sharing between the line
and agencies, making it cumbersome and time-consuming.

Now that issue has been resolved, and Oceania can run
campaigns faster. In some cases, it can reduce the number of pieces mailed
while at the same time raising the conversion rate. Sending out as few as 250
pieces means more boutique agencies can participate, Upshaw said.

Some agencies are taking the data analytics in-house. Since
April, Cruise Planners has offered its franchisees CP Insights, an analytics
program that segments customers into dozens of categories with labels such as “country
club climbers” or “planners and savers.”

The program distills data drawn from hundreds of sources,
such as credit card records, magazine subscriptions and the like. Based on
their past selling volumes, agents can run a certain number of customers in a
campaign, which does not have to be direct mail. The idea is that the program
matches clients to cruise lines.

Vicky Garcia, co-owner and COO of Cruise Planners, said that
while data never trumps personal knowledge of an agent’s customer, it is
another tool to help target scarce resources.

It can semi-automate mailing lists, reducing the agent’s
workload.

Garcia said third-party analytics are “hugely expensive”
up front but pay dividends on the back end with more efficient marketing.

“Especially as things change with marketing dollars, as
budgets get smaller you have to do the most with what you have,” she said.
“It’s really helpful to be a lot more targeted.”

Read More —> Source link