Once you have your travel business off the ground and running, you will want to know how well it is performing. Not only does measuring the growth of your travel company provide insight as to whether or not it is operating successfully, but it also helps you plan better for the future.
Every company has a unique business model, so growth means different things depending on what your goals are. Whether your priority is to sign up more clients to group trips or increase total booking value, here are some important travel metrics which provide an indicator of how the business is performing.
Travel Metrics To Measure Growth In Your Travel Business
Volume Of Bookings
A great place to start measuring business growth is by analyzing the volume of bookings coming in. Why? That is because sales volume is an indicator of the demand for your travel product. More sales equal higher demand.
Of course, when your product is in demand, your focus shifts from marketing it to figuring out how to grow your business to meet the demand. And on the other end, when the number of sales is low, it is time to see how you can improve on your travel offering.
As a motivated entrepreneur, you probably have ideas on how to do this already though. Either way, it is a good idea to track the weekly/monthly/seasonal volume of sales. Doing this ensures you know how well your business is performing and where to focus your efforts.
If you offer several tours or travel products, monitor which of them sells the best. It could also be a case of comparing how a single tour or activity performs over the space of a year to work out which season is the most popular with your clients.
Using this information, you can see which are bringing in the most revenue, and which you need to work on. With the proper insights, you can pick up on things such as whether to adjust the price, remove a tour altogether, try advertising it on a different platform, call in another guide, etc.
Overall revenue is one of the most important travel metrics to measure because you want your business to be profitable. If you aren’t meeting revenue targets to cover your operating expenses, then your business certainly won’t be growing.
Bookings According To Channel
Whatever the case may be, it is important to know which channels are bringing in the most revenue or seeing the most engagement. This way you will know how to distribute your travel product between them.
It is also worthwhile looking at whether travelers are making bookings using mobile or desktop.
For example, a low number of mobile bookings means you could be losing out on travelers who make last-minute tour or activity reservations once they are in a destination. Or it could be because your website does not render well on mobile screens.
If it is the former, you know to target marketing efforts to meet travelers before they arrive in destination. The latter, you need to improve your website usability.
Repeat Customer Bookings
Research shows that it costs five times more to acquire a new customer than it does to keep an existing one. Therefore, examining travel metrics to identify the number of repeat customers coming through your business is of immense value.
Firstly, you want to identify which of your products are attracting repeat customers; these are your winners. Then you should see how you can promote this tour, activity, or product to bring in more repeat clients.
Ideas to try include setting up a discount code that clients can apply to your travel product or tour next time they book.
By encouraging repeat bookings, you can lower customer acquisition costs and help your travel business grow. Overall, it provides a good indicator of how satisfied customers are with your offers.
Income Generated From Upselling and Cross-Selling
Upselling and cross-selling are beneficial to both you and your clients. You get the extra revenue, and they get a convenient value-add which they don’t have to find elsewhere.
Take a look at the travel metrics to figure out which add-ons are popular and should be promoted further. Advertise these more prominently across the various selling channels to make sure that clients know you offer them.
Number Of Cancellations
No travel business wants to see booking cancellations. But the reality is they do happen from time to time, and you should be prepared for it. Measures need to be put into place to lessen the impact cancellations have on your business, the biggest being a loss of revenue.
Identify how many cancellations you get in a certain period. If there are enough to affect your bottom line, it is time to implement procedures that protect your business.
As an example, you could layout deposit forfeiture terms, or charge a cancellation fee. While this is not ideal, neither is dealing with empty spots that inhibit the growth of your business and ability to generate an income.
Like repeat bookings, earning referrals is a way of lowering customer acquisition costs.
Keep an eye on these travel metrics, as if they turn out to be substantial, you could start to offer incentives for customers who sign up new business for you. Turn it into a mutually beneficial relationship whereby you can grow your business, while your client earns a reward for signing up friends or family.
Growth comes in many forms and doesn’t necessarily mean taking the step up from small to medium-sized or even large business. It can also be about increasing revenue to become more profitable.
Whatever your objectives, these travel metrics should give you a good idea of what to look for to build up a successful travel company.