Can you improve it, Touristologists?!?!

Sharing Economy, Webscraping,  multi-screen world solution…

Can you improve it, Touristologists?!?!

The last post?

Maybe this is the last post, at least for a while!!! But remember my nickname is Skynet so… I will be back!!!

This blog has never been about me, when I began this blog five years ago, I felt that Touristology needed a voice! Touristology, thanks to all the mentors that I have, speak through me. Nowadays, Touristology has more and more voices. The number of Scientists claiming to be a Touristologist is growing and the voices saying that Touristology is not a science are inaudible…

For the above reason, Touristology now needs more tools than voices… I will try to help with this!

From now on, I want to spend most of my time developing the ideas that I will explain in this post. The topic is the new, new intermediaries for specialized tourism. You can also call them, the dreamers and creators of “My own 1,2,3” in Touristology’s terms.  In this post, I want to describe the business model, then I want to focus on developing the technological scheme always, two hands, remember.

In my classes, seminars, in-company training or start-up meetings in order to define (or redefine!) their (OUR???) business model it is difficult to get deeper in server-side technologies, client-side ones, responsive web design or how to be ready for a multi-screen world and I want, definitely, to go deeper. Do you also have this feeling, Touristologists? If this is so, let me know… maybe we can go deeper together!

As you know, I have a bias for specialized tourism. I think that is a better base for developing a tourism destination or tourism enterprise. I like to represent this with this figure:

Furthermore, I think specialized tourism brings more opportunities for my Touristologists! One way to visualize these opportunities of specialized tourism is using the long tail theory. Let’s see a figure:

One of the basic goals, in this scenario, is to generate the magnet power that a congress (like the World Mobile Congress) has over one of the main segments in tourism (Business), over any niche segment inside “the long tail” concept.

In the “head” you have to use the most popular Social Networking Site (SnS) Central Reservation System (CRS) or On-line Travel Agency (OTA) and Search Engine… BUT…

In the tail you have the opportunity and…  The Touristology  duty to create your own chain of value and manage all the 3 C’s in a customized, syndicated and pro-amized way.

One way to achieve that is creating your own SnS, which based on the loyalty of the group of users can also become the Search Engine, the OTA, the CRS , the you-name-it of reference, for this specific niche.

It has always been my honor and privilege to explain some of the projects My Touristologists are developing. Do you want to see a couple of examples? Today, I will talk about Prometteo and Glaykos.

The first is Prometteo, the brainchild of Sara, one of the most brilliant Touristologists that I have ever had in my classes. She is developing a community for deaf people that want to travel without any barriers. Here you can get a glance about her vision:

The second one is Glaykoss, the brainchild of Jaume and Nuria two brand new Touristologists lighting up the Touristology sky!

I am sure that in the near future hundreds of projects like this will appear! We are Touristologists! We are changing the way we enjoy, manage and define Tourism! We are the best minds working in the best sector ever!!! 

Customization is the name of the game!

In the year 2000 I presented my doctoral thesis about how to apply complex systems in the Tourism sector (it was all about adding value through customized 3 C’s: Content, Commerce and Community). Even though I was (and still am) a Touristologist builder, I have always believed that you have to get experience out of the classroom. For that reason, I love to work as a consultant and entrepreneur!

My mind was full of ideas related to the new internet business model and I had been improving my coding skills focused on web languages (basically, Java). So, I was ready to work for a big consultancy company. I sent my CV, I asked for personal interviews, I asked for colleagues to recommend me… Not Touristologists I was NOT just waiting for a call… I was PROVOKING a call. In the same way that we have to seduce customers to come to our tourism destination or lodging enterprise, we have to seduce employers in order to get a good job. But you already know that!

One of these job interviews was for applying to “E-business product manager for the Health sector”. In the middle of the interview I got this question…

So, you have experience in hotels but what about in hospitals?

Well - I confidently replied.- At the end of the day, they are quite similar. Beds, Food and Beverage and customized servuction!

Are you joking? -Asked the perplexed Interviewer?

Once more the lack of vision about Servuction doesn’t allow me to get a job.

Lack of vision or destiny, Touristologists? After the Interview I got a phone call that ended up with me becoming an E-business product manager for the Tourism sector!!!

Tourism, Health and Education are very good examples of servuction. In all three, the participation of the customer is the key for a good output. In all three, Internet brings new opportunities for customizing the services and creating groups of customers and, as you know, “GROUPS” is another word carved into my mind.

Was I joking? No my friend! I was dead serious!

A few weeks ago, Josep Baselga was talking about how cancer treatment is changing thanks to new technologies and the ability to deal with big data. Until now, pharmaceutical companies have had to discover a cure, a way to improve health, or how to avoid metastasis if you get a tumor. Then they create a pill and sell it through pharmacies that get a 30% of margin.

BUT nowadays, we know (explain Mr. Baselga), that each tumor is different. Tumors are not a contagious disease. It is something that we develop in a different way based on our DNA. So, we need to create customized pills for each customer. We need to change the process. You send your DNA, based on that, we create the pills and then send it to your home (or maybe in the future we will be able to print them using a 3D printer!!!!)

Is this process so different to big tour operators selling products through travel agencies (well, an important difference is the commission that travel agencies get!!!)? Tour Operators buy plenty of rooms getting economy of scales which allow them to offer very competitive prices for a strongly price orientated customer.

But nowadays, people want experiences. Is there an easier way to create that for them than using customized 3 C’s??? People want to travel and also get what tourism can provide to them: A new perspective, international contacts, healing wounds (both physical and psychological); learning new things (especially multidisciplinary ones); giving a bust to their creativity…..

So, we learn what is important to the tourists, we learn the best way to provoke an experience and we sell a customized dynamic packaging to them!

Are you able to see the parallels? Are you able to see that I wasn’t joking?

Is it so different in education? Where different students have different multiple intelligences. Where different students have different backgrounds (both academic and professional). Where different students have different taste and are looking for different opportunities?

Now as 15 years ago…. Tourism, Health and Education are good examples of servuction! So, getting data and transforming it into knowledge in order to customize the experience is the key for any successful Trip, Treatment or Education process! I am not joking! As sure as Touristology is a science!!!

Seriously? This is all you get?

The other day, we talked about a metaphor related to Revenue Managers and Surfers. If you remember we used a figure similar to this:

Today I want to go deeper into the “Booking Pace” concept.

As you remember one of the most important differences between first class Revenue Managers and Surfers is that the former can alter /transform/ influence the wavelength of the wave while surfers (like regular Revenue Managers) just adapt to them.
Sometimes I have the opportunity to spend my time with experts, gurus, I-have-been-a-revenue-manager-for-X-years, Touristologists with the Revenue Manager hat on… and they share with me their knowledge about how to control the wavelength:
One of them was saying to me:
When the market is up: Increase the prices, cut your offer in the most expensive CRS or OTA and ask for a minimum of stays in your hotel.
When the market is down: Do the opposite!
I said -Wait a minute. Can I take notes? I want to share this with my Touristologists.
So, here I am sharing this with you.
I can agree with “When the market is up” ideas but remember, some CRS don’t allow you to cut the allotment. Well, they allow you to do that but then when the customer searches… you appear in the last pages. You know the joke… where is the best place to hide something? In the second page of the most popular search engine or central reservation system!
Let’s talk about the opposite ideas…
First a question: Seriously? This is all you get? Wow! This is rocket science! What do you think Touristologists? Can Touristology add something to this recipe?
Can you see the problems with your positioning that having more price-oriented people can cause?  Can your hotel be perceived as a low quality lodging?
Do you realize that by opening the most expensive channels  you are offering the biggest discount to customers that are looking for the best prices and, precisely for this reason, their loyalty is owned by the intermediaries?
Is it possible that we offer a low quality servuction? 

Is it possible that having to deal with more customers blocking you from implementing pricing activities like opacity, customization, up-selling and cross-selling? Remember mastering pricing strategies can help you in both situations, when the wavelength is high and when it is short. If you do it properly, you will get happier customers and a better on-line reputation, as you can read here.

Can Touristology add something more? Well, are you able to look for new waves? Are you able to think as a Touristologists does?

But, Jordi… to do that you need the training and the experience of a Touristologists. We need someone able to go to any place in the world and seduce a customer, a segment, a group, then customized the service and the servuccion, then use/build the most convenient chain of value.

Finally! That’s right! Just remember, we need a Touristologist with the Revenue Manager hat on!!! Is it necessary to say what kind of solutions Touristologists share with me? They are redefining the way we describe and practice Yield/Revenue Management. They are the best minds working in the best sector ever!!!

Are Revenue Managers a kind of surfer?

I like metaphors and oxymorons, Touristologists! I can’t help it! They allow me to represent complex systems in an easier way and, as you know, I strongly believe that Tourism is a complex system.
So, I will try to go deeper into the day-to-day battlefield of a Revenue Manager with a metaphor. Are Revenue Managers a kind of surfer?
If you remember, in this post we saw this visual representation:

Here we see that we have to select the right customer based on the price that they are willing to pay, the ancillary services they might buy, the margin we get, the length of stay…. Also we have to look for new opportunities answering the following questions: To whom? With What? When? and Where?
Furthermore, The Revenue Manager has to be ready to detect the time when a specific customer, group or a segment is ready to book. This “time to book” moment is similar to the detection of the beginning of a good wave for a surfer. For customers related to a congress it can be three months in advance, for a couple looking for a romantic getaway it can be a fortnight. Of course, these data are only examples, nothing better than real data for the specific hotel that we are dealing with. Data from the Property Management System (PMS), the Customer Relationship Manager (CRM), Loyalty Program, Mobile application, WebSite, Others websites using webscraping, you-name-it!!! All these data and the tools to transform it into knowledge sometimes are called “Big Data”.
Then, we have to follow the wave and see the number of reservations that we are getting every day, every week….that is one of the definitions of “Pick-up”. We can see if the wave is growing or not. We can see if the wave of our competitors is growing or not, thanks to web-scraping techniques.
So, just like surfers, Revenue Managers study waves and decide which one to surf or not. I want to highlight a big difference. First Class Revenue Managers can try to control the movement of the waves and usually they are successful. Regular Revenue Managers are more like surfers, they just adapt to the waves. What kind of Revenue Manager do you want to be?
It is like Economists trying to control the movement of the GNP

If we move up too much we end up with inflation, if we move down too much we end up with high unemployment. Economists want to avoid that and for that reason we use monetary and fiscal policy. As Schumpeter said, it is impossible NOT to have waves (Communists with a planned economy tried it but, so far, without success). In the same way, Revenue Managers try to have a more stabilized wave. If the number of bookings is high you can have an opportunity cost problem (maybe you have to sell your services at lower prices). If the number of bookings is low you can end up NOT selling some of your services (and as you know, if it doesn’t sell today… it’s lost for ever!) So, you try to control the wavelength of each of your waves ( remember they represent a segment, a specific customer or a group). In Revenue Management literature this is usually called “the booking pace”
Let’s see the new visual representation, shall we? 

Another difference that I wish to highlight…Regular Revenue Managers are like surfers. No waves no movements, BUT first class Revenue Managers are able to create new waves! They have information about their customers and segments (the big data that we mentioned above) they have the knowledge, the attitude, the courage to try to seduce the customers. They are Touristologists with the Revenue manager’s hat on. For them, to create or customize an offer in order to seduce a specific segment using the right chain of value (Does 1,2,3 theory ring a bell for you?) is their thing! They are, definitely, the best minds working in the best sector ever!

It is great to be a Touristology builder!

The previous week I shared this message on twitter. The name of the Twitter account? Turistoleg!!! What else? 

23 years ago I began my career as a Touristologist builder! Today…Different faces, similar archetypes… Same passion!!!… Yes, the faces of the future Touristologists are different, but you can see archetypes, attitudes that repeat over and over… The one that finds some concepts difficult to catch but never stop asking, never stop reading, never stop believing… I am not worried about these ones! Persistence is a key ingredient for success and they are pure steel Touristologists warriors! How could I forget Patricia or Joan?!?!? 

The one that believes that the subject is very easy, that He/She understands everything… - Don’t worry Jordi. I already know all this! 

Wow, be aware, Jordi! - I, clearly, listen to Touristology voice talking to me… He/She doen’t know and when He /She realizes that … He/She will think that it’s your fault! Ooooh, what a pity! I don’t remember you… 

The one that, when I am looking for a volunteer to present a study case in front of all the class, instead of avoiding my glance, they smile and say “ I can try. I will do my best”.

Last week I saw the birth of the new Miguel Angel, the new Roman, The new Sara, The new Roger, the new Nicole, the new Miriam, The new Sergi, The new Pau, the new Esther, … The kind of Touristologist that has a kind of Master and Commander Attitude! The kind of Touristologist able to convey that a difficult study case is an easy thing! I can see them creating the new killer start-up, changing the way we enjoy, manage and define Tourism….Making me as proud as can be! 

Yes, 23 years being a Touristology builder... well, to tell the truth 20. The first three years I was learning like crazy about the Tourism sector!!! Thanks to the best Touristologists in town…

Espuña: First person that said to me “We are Touristologists!” Almodovar: Master of masters dealing with intermediaries for the tourism sector.

Urgell: Born to be an hotelier.

Iglesias: A marketing lighthouse.

Calabuig: A geographer that fell in love with Tourism.

Codinas: A psychologist genius entrepreneur and expert in travel agencies.

Martin and Peguero: The dynamic duo! The first ones that enlightened me with the Revenue Management philosophy (at that time, Yield Management).

Arcarons: An incredible lawyer… 

You were the best mentors in Touristology! 

Every year has been different! Have you been a teacher for 23 years OR have you repeated the same year 23 times? Have you been a Revenue Manager for the last 22 years OR have you repeated the same year 22 times? Have you already learnt client-side MV* and how to combine with RESTful Web Apis? Or are you still using the same technologies but now in mobile? I don’t know about you, but for me… 

Every year is different, even though archetypes remain… What about the passion? I, definitely, believe that it is increasing every year…. I love to be a Touristologist builder!!!

Can you apply Touristology to cruises?

Of course, Touristologists!!! At the end of the day, a cruise is a kind of Hotel/Resort with similar behavior to a transport company. We have to remember that the average length of stay in a cruise is seven days doing 3-4 stops. So, you go to places, but most of the time you are in a kind of resort with plenty of activities. Anyway, lodging or transport… clearly, it is related to Tourism, therefore, Touristology will give you the necessary tools to become AND remain competitive!

Globally, the cruise market is growing in number of passengers (21.3 million passengers in 2013 and expecting 21.7m in 2014). What about in revenues AND profits? -Ask Touristology’s voice!

It is a closed business (economist like to name it oligopoly) where three players get 80% of passengers and 72% of revenues. Those three players are:

Carnival,     Royal Caribbean and Norwegian Cruise Line.

The cruise industry is a big success in North-America, origin of 55% of all passengers. In Europe the market is also growing (even though the market experienced a backward movement after the, tragically, famous accident)

One of the tools that Touristology provides is the following matrix. Let’s see if we can use it in order to analyze and provide some advice for the cruise sector!

You can learn more about this matrix here…

And here… (don’t miss the video!!!)

This matrix reminds us that, in order to be and remain competitive, you can follow the Innovation path or Standarization path….

In the standardization path we have examples of successful companies: Ryanair, McDonald's, TuneHotels….. The basic strategy is to get economies of scale and then offer the lowest possible price, do promotion based on discounts…. It can provide good results BUT if you want to beat the three dominant players in the cruise sector OR one of them wants to increase their profit… then you will have to explore new segments, new channels of value… Welcome to the Innovation path!

There are different ways to follow the innovation path (some of them are not yet discovered! Are we talking about innovation, right?)

A) Selling using my POSITIONING in the market. Do you want to see some examples?

A-1) Disney. They don’t have any problems selling their cruises… People love to spend time with Disney Characters!!! If you are selling experiences, like Disney does, you are not selling cruises anymore. The cruise is just a place (a commodity as many hotels have become) where you enjoy the important thing… the feeling of being part of Disney’s world!

A-2) Virgin looking for the segment I-wanna-be-Richard-Branson aimed at younger generations.

A-3) National Geographic who, clearly is selling experience over luxury.

A-4) Scientific American. Some people believe that tourism is just searching for happiness… But Tourism can help you to achieve other important things, as well. Learn new things? Gain international contacts with experts in the cutting edge of science? To change your regular perspective?

Those examples are innovation and My own 1,2,3. They identified a segment, customized their product and distributed it through their travel agencies and their own meeting places (Shops of Disney, Disney Channel, Virgin outlets, National geographic channel and magazine!!!)

B) Other option for walking the Innovation path is to rely on Specialization (To me, the best!): What about cruises for heavy metals fans as Royal Caribbean tried through a partnership with TUI? It was a big success. If you are selling the experience of enjoying concerts of your favorite music band, together with other people that feel the same, then they feel part of a community… Then you can add value selling customized ancillary products (tattoos, Karaoke, music lessons, you-name-it…), promote direct bookings, use the long tail in order to promote and commercialize your business.

Of course, when you are selling a cruise, you are selling experiences BUT, as all Touristologists know, if you don’t use specialization power, then the price will become the most important driver to choose a cruise or a substitute product.

If you follow this advice you wouldn’t sell just a cruise anymore, you would sell the benefits of a trip where you can get what Touristology provides…

Community building, New perspectives…creativity, isolation from the usual place….

As I said here “Touristology is a science related to Tourists travelling/moving from one place to another for travel reasons or for necessities that they can better achieve through a trip: Getting and keeping international contacts; healing wounds (both physical and psychological); learning new things (specially multidisciplinary ones); giving a bust to their creativity, as Alain de Botton said “Journeys are the midwives of thought”; improving relationships (organization team building , couple, grandparents-grandson, single parents…)…”

You can read here some ideas about how to use specialization in order to transform your cruise into the place to be.

Do you think that you can improve the profits of a player in the cruise market using those matrixes? Do you think that you can help (OR BE) a new intermediary in this growing sector? 

Do you want to become a Touristologist? I will be here waiting for YOU!!!... By the way… Happy New Year!