How can tours and activities businesses increase the amount of money being made from each customer?
There are two ways to drive this – by increasing total spend per order, and by increasing frequency of orders.
Increasing total spend per order
Tour and activity businesses appeal mostly to travelers – people who are just passing through. This is why maximising your revenue for each customer’s order by upselling and cross-selling your tour products is even more important to you than it is for other businesses.
Upselling is an opportunity to enhance your customers’ experience. Think about what complementary products add value to what they’re already buying. For example, it can be a VIP lunch, hotel pickup or camera rental.
- Place the offer on or before your website’s checkout page (this is when they have their credit card handy).
- Bundle your extras into a packaged product and offer it at a special price.
- Run promotions (by creating promo codes) that give customers discounts when spending over a certain amount. For example, they get a 25% discount if they spend more than $100.
Your booking software should allow you to have full control over how extras are charged – whether your customers can choose the quantity, or it’s limited to one extra per order, or if the extra is charged for each item or person booked.
Increasing order frequency
While you may argue that yours is a ‘novelty’ product, it’s imperative to drive repeat bookings.
Why? Consider this:
- Someone who has bought from you 3x has a 54% chance to come back for a 4th time.
- Returning customers spend 20% more than first-time customers.
- A first-time customer has a 27% chance of coming back.
Getting past customers to come back is another challenge that tour and activity operators face. Research conducted by Sumall found that you should promote repeat business by:
- Encouraging a high initial purchase (using promotions geared for new customers);
- Pushing for a second sale; and,
- Allocating a quarter of your marketing budget to purchase incentives for repeat customers.
- Tell customers that you’ve launched a new product they might like.This is ideal for businesses that by nature are usually a one-off experience (eg. parasailing) and businesses that inherently have a repeat buy (eg. rentals). If you launch a new product by expanding your locations or adding a new type of equipment to be rented out, this is a chance for you to let your past customers know.
- Remind customers that it’s time to come back. This is perfect for seasonal businesses, such as whale watching cruises. For example, you can let your customers know that now is the perfect time for spotting whales on their migrating route.
- Create coupons, because if a customer uses a coupon once, they’re 3x as likely to use one again.
- Use online advertisements to retarget your customers (click here to learn what we mean by that).
For more online marketing tips, download our free ebook: