How we grew our little day tour business to over $2 million in annual revenue
I’m sure you will all agree that when you finally put it all on the line, you take the leap and you launch your tour or activity business…you’ve signed up for a wild ride.
It’s exhilarating and thrilling, exhausting and overwhelming…I could probably throw a dozen other adjectives into the mix as well.
I clearly remember experiencing these emotions when we started our tour business back in 2007…but I mostly remember being exhausted, overwhelmed, and frankly, dejected after our first year.
We were fumbling around blindly and really had no idea.
We had started our tour company with no tourism or business experience, no networks or support and no cash…we didn’t really have much going for us.
Above all, we had no idea who our customer was. We had started our business by creating a wide selection of day tours that WE liked and thought were great. We hoped that other people would find our brochure, or get to our site and like them enough to open their wallet and buy.
We didn’t know who they appealed to and we didn’t target a particular type of customer.
After a year like this, we were burnt out, struggling to breakthrough and considered throwing in the towel.
However, the pivotal moment came in the middle of 2008 when we found ourselves a mentor.
We were 5 minutes into our first catch up (4.5 minutes of which I spent detailing our spectacular lack of success to date) when our guy said:
‘But Josh how the hell can you possibly expect to sell tours when you don’t even know who your customer is?’
It was like a smack in the face and it changed everything for us.
From that moment, I got to work learning exactly who our customer was and what they truly wanted and required – what our tours needed to look like for them to open their wallet and pull out their credit card.
I also got to work exploring who our customer could potentially be with some adjustments to our tours. Were there new customers that we could consider – even it meant making some significant changes to the way our tour looked in order to appeal to them?
So how did I do this?
Well…the answer isn’t groundbreaking…or sophisticated….and it isn’t really that sexy…
The answer is RESEARCH.
It takes time, it takes commitment and it means taking a step back…but here’s how I went about it:
- I studied my direct competition closely. Who was taking their tours? I looked at review sites to see which types of customers were writing reviews. I looked at testimonials on their site. I looked at the foreign language translations they offered. I had a friend call them up and ask a few questions about which kind of customers took their tours.
- I spoke to concierges in my city. Which type of guests stayed at their establishment? Corporate or domestic leisure? South East Asian? Mainland Chinese or Arabic markets? USA or European? I picked their brains and learned about the needs of their guests. Which types of guests booked tours? What did they like to do? Who would like the types of tours we offered? Why? What would make our tours more appealing to some of their customers?
- I reached out to other tour operators offering similar styles of tours to ours but in different regions, cities, states or countries. For example, if you’re a foodie walking tour operator in, say Sydney, Australia, reach out to similar tour or activity operators in Melbourne, Auckland, Los Angeles, or any number of destinations. Get a conversation going. How’s business? Share your insights and trends. What’s working? What’s not? Which types of customers are taking their tours? What are they noticing about various markets?
- I turned to my regional, state and national tourism organisations. There are so many unbelievably valuable sources of advice, support and insights to be found within the walls of these places.
And most importantly, they have a vested interest in your success. Better quality tourism products translate directly into a more robust tourism outlook in your city or destination. They have a RESPONSIBILITY to help you succeed. In these organizations, I looked for insights, trends, market intelligence, and for highly credentialed and experienced industry people to tell me what they thought about our tours and who they were most suitable for.
I looked for people in roles like:
- Product development
- Industry support, industry liaison or industry relations
- Business development
- International market coordinators/market development managers
- Trade and media relations
So, after two years of struggle and two years of confusion as to who I was trying to sell my tours to, I took a step back and I dedicated a chunk of time to this process.
I got crystal clear on who our customers were and who our customers could potentially be. What our tours needed to look like for our customers to buy…and what we needed to do to our tours to make them appeal to different types of customers.
It was a game changer and we never looked back. Over the next 6 years, we were able to grow our little day tour business to over $2 million in annual revenue.
So as far as I’m concerned, finding the success that you crave as a tour or activity operator begins with an intimate understanding of who your customer is.
If you enjoyed this article and found it really helpful, please take a moment to download our ’15 Steps to a 7 Figure Tour Business’ here. It’s a look ‘behind the curtain’ at the step-by-step process we took to turn a vague idea into a multi 7-figure tour company. Enjoy.
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