This episode’s question comes from Liz Fitzgibbon, based in Tasmania, Australia, who is doing some great things helping the local tourism sector bounce back from COVID-19.
Liz asks, “The current climate post-COVID has forced the local tourism sector to find a completely new audience, where most SME’s previously relied on International traffic. What advice do you have for these advertisers to capture a domestic audience? Where should they start? Where can they make the best use of small advertising budgets?”
Todd Wright, Founder and Director, of Threesides Marketing, in Canberra, Australia, has a long history of helping local tourism operators and he joins us to help answer Liz’s question.
This episode is the first in an eight-part series answering listener questions. For each episode and question, an amazing marketer from my network will join us and provide some different points of view and advice.
As part of the service, I have had this episode transcribed. Transcribing, proofing, and editing a podcast episode is A LOT of work. That’s why I use a service called REV who provide professional freelance transcriptionists who are vetted for quality. While they offer a 99% accuracy guarantee, I do not proof-read their work extensively. Instead, I simply copy and paste below and, as such, please note that this is not be a verbatim transcript of the episode and I have trimmed things like the intro, close, and mid-show ad.
Threesides has been running since 2007. I noticed some gray hairs the other day, so we’ve been running quite a while. We’ve got a team that’s based predominantly in Canberra. We’ve got parts of our team that’s based in Sydney and also Brisbane, and one of our team actually works in Poland.
We’re an integrated marketing agency with a digital slant, so we grew up as digital natives. Digital sort of drives a lot of what we do because it drives what consumers do, so we’ve spent a lot of time working with clients from planning, implementing and evaluating the marketing from end-to-end. And in the tourism game, this is really where we started.
When I set up the business back in 2007 with my brother, I was working, it was at Canberra, he was working at the National Museum, and we both saw an opportunity in the market, and we love tourism and we thought, “What better thing to do than go to work every day and help people improve their businesses in the tourism game?”
So we’ve worked with a lot of destination marketers and a lot of regions. We work with Sapphire Coast region, we’ve worked with Eurobodalla, we’ve worked with Visit Canberra on a… Sort of work in our backyard. We love where we live, we love what we do.
So we’ve worked with Yass Valley tourism, Destination Southern New South Wales. We work with Southern Highlands on their successful part-time campaign, and tourism’s something that although it only, these days, makes up about 20 or 30% of what we do, it’s a big part of our love, and who doesn’t love to travel and have experiences and meet people?
Hear, hear. Now, Todd, I invited you on the show to help answer a listener question, and the question I have for you comes from Liz, as I mentioned at the start of the show.
Liz notes that the current climate post-COVID has forced the local tourism sector to find a completely new audience, because where most SMEs had previously relied on international traffic, that’s clearly changed for at least the time being, the short-term. How are you seeing that refocusing of the target market with your clients?
Well, it’s probably a perfect time to ask that question, Daniel, because I’m back from a week’s holiday, you know, holidaying in my own country and making sure I’m not just doing half a holiday, as Tourism Australia’s asking at the moment.
Off the back of the bushfires across New South Wales and Victoria and Australia, then that came off the back of the biggest drought that we’ve ever seen, and then that rolled into a global pandemic, you’ve got regions that are hurting significantly right across Australia. Add in some border closures, add in some uncoordinated approaches from state governments not talking to federal governments across Australia, and it’s been absolutely devastating.
International has always been a part of different businesses, but it affects everyone in a different way, right? So, what we need to do is take what we used to do for internationals, which was probably charge a little bit more and provide a premium international experience for people that might’ve only been in the country a number of days. We need to evolve and adapt that product, that experience and that offering right back down to a local market. We need to stop treating Australians as, “They’ll know what they’re doing and they’ve seen this all before.” Or, “The bush isn’t exciting for them.” Or, “They know what a beach is.” We need to treat them like they’re discovering a destination for the first time and go back to providing some of those premium experiences.
Just on the weekend, I was down the south coast in New South Wales and it was fantastic. We found this little gem, which was the Shoalhaven Zoo. Have you ever been to the Shoalhaven Zoo, Daniel?
I have not, Todd.
It is a bizarre little place at the back of Nowra in which we did a premium experience, and I paid as much to do a premium experience in the back blocks of Nowra at the Shoalhaven Zoo that I would at Taronga Zoo or any zoo in the world. I had a fantastic experience, and that was feeding meerkats by hand. At 80 bucks a head, it’s a 20-minute experience. You feed these little meerkats. You can’t do that in a lot of places around Australia.
So what they’ve been able to do is, regardless of international tourists or Australian tourists, they’ve been able to provide these premium experiences and bring things online that would match any destination. Because it’s a small group, it’s premium, and Australians are willing to pay. But, they always want a little bit of extra, they always want a little bit more, so you really need to think about your product development.
So that would be my first tip: small group niche experiences. Provide premium personal experiences and treat Australians like they just want to discover as much as international tourists.
I love that because it certainly equips people like yourself and others with some amazing stories to tell other people, and that creates really positive word of mouth.
Now, of course, no one was planning for this pandemic and some are still kind of paralyzed, because as you’ve alluded to before, even their best work can change quickly with outbreaks and border closures and the rules changing almost daily in some cases.
How does that translate into advertising for these people? What’s your advice on where local tourism operators should start when doing that refocusing that you were speaking about to their target audience? But I note that Liz has specifically asked about how that will translate into advertising and reaching those people.
Advertising’s an interesting one, because the best thing that any tourism operator can do is actually advertise through distribution first and foremost. What I mean by that is making sure that your product is accessible in as many marketplaces. Let me take the technical out of it. Let me call it Airbnb. Let me call it Bookings.com. Let me call it all of the places that you’re used to booking a holiday. For tourism operators, we call those distribution channels.
So, making sure that you’ve got your product exposed to as many suitable distribution channels as possible is going to make sure that you’re actually advertising your product, where people are ready to buy. So this isn’t just about targeting people on Facebook or Google Ads, this is actually making sure that that product is bookable at the point that they’re finding out about. So you can’t compete until you show up. So making sure that your distribution channels are there.
If you don’t have online bookings, you’re about 20 years behind, making sure that your experience or your accommodation or your tour, whatever it is, is bookable instantly online and distributed through multiple channels, and making sure that you’ve got a channel manager in place.
When it comes to advertising, well, let’s go back to my first point. Have you got a product that is competitive enough to stand up against everybody that you’re now competing for, which is the same pie. Where there’s an international market, it’s a different pie. There’s new people that are coming in, but now, we’re all competing against each other. And I’ve always said to everybody, your biggest competition has never been Hawaii, it’s never been New Zealand, it’s never been the United States or the UK. It’s always been South Australia. It’s always been Queensland.
Because a lot of these SME businesses don’t have international marketing budgets. They’ve always relied on Tourism Australia to promote the country, they’ve relied on state tourism organizations to promote the state as part of the country, and then they just rely on those people then to go searching when they’re inbound. Things have changed now, so now we’re competing against people in the next region. Sapphire Coast is now competing with Eurobodalla Coast.
But my question there for people is how can we coordinate? So from an advertising approach, don’t go it alone. Work in partnership with people. Work in partnership with businesses in your region to build economies of scale, to build an attractive destination which is worth going out of your way for. Because if you’re just advertising alone, people will not come to a region that has one thing to do.
But if you can act like a mini destination marketing organization, get together with two or three like-minded businesses and work together, you’re actually going to build quality and build value there, and then you can worry about things like Google Ads and Facebook Ads.
And as we all know, some of the traditional things are dying. Print’s dying. But in their place there’s always something in a place. Have a look at some digital influencers, people that are traveling and no longer controlled by “I’m commissioning a story”. They’re controlled by themselves and talking to their own smaller audiences.
So, work in partnership to promote a higher value product and think about alternative channels.
As you were speaking about people refocusing back down to the local level and working together, it occurred to me that some people may have been collecting emails from locals, from Australians who may have visited some of these places over the years, but they might not have been doing a lot with that email database because they may have been focusing on international travelers. But it kind of is sitting there now, they might be thinking, “This looks a little bit attractive. I might dust it off.”
What’s your advice for those who might have a bit of an inactive email database of Australian emails that they’re thinking, “This might be worth dusting off and trying to fire up to get some business.”
Nothing focuses your marketing like a pandemic, right? So, while you’re opening that top drawer, if you’re looking at some of the neglected things, like an email marketing list, there’s definitely a few things that you need to think about.
The first one is, do you know what the Australian Spam Act is? If you don’t know what that is, jump online, have a look at the Australian Spam Act and also the privacy principles.
Let me summarize it for you is you need to have people’s opt-in permission at the time that you gain their information to actually email them. A really great rule of thumb is don’t contact them if they’ve been on your list for more than two years. That’s called an aged list. A lot of systems, things like Campaign Monitor will actually say, they won’t allow you to upload lists that are older than two years old.
However, in tourism, you might have a cycle where people only visit you once every two or three years. If that is the case, reactivate that email using a really great platform and go out to people and say, “Would you like to start receiving information?” Or put your hand up and say, “Hey, remember us?” Reintroduce yourself before you start putting them on an email a day, you know, a program from you trying to promote your products or services.
And as always, treat your list with respect. So, making sure that you’re smart with your list, so sending the right information to the right people. And we talk about segmenting and targeting and getting the information right, but also make sure that you’re respecting that list. If they’ve opted out once, don’t opt them back in.
There’s a little old trick that I’ll see people setting up separate accounts because there’s been a lot of bounces or opt outs. They’ve opted out for a reason, so always treat the list with respect. If it’s too old, bury it, and make sure that you’re really smart with your data. And email in conjunction with things like having a website strategy, with a distribution strategy, with a digital ad strategy.
Email is fantastic. It’s one of the least sexiest forms of marketing out there that I ever talk to people about, but time and time and time again, you can point at the results. Email opt-in marketing is about people that want to continue that relationship with you, and email’s a great way to do it. So I’m a big advocate for email as part of your overall contact strategy with your customers.
And of course, like you said in your previous answer, if you can find some like-minded businesses to market with and you can sort of leverage each other’s email databases, then it’s going to multiply the effects that you’re trying to achieve as well.
So, Todd, budgets are always a focus, even when it’s not a pandemic. But even more so now with various stimulus packages coming and going and money flowing through the domestic market and some state premiers trying to encourage people from other states to come and visit and spend their tourism dollars in their states, how does an SME tourism business make the most of a small budget?
Budgets are always a issue and people never like to talk about it, but the one response I always get where when I ask what’s your budget, they’ll go, “Well, as least as possible.” And it’s the old agency-client relationship. “They don’t want to spend too much, they think that I’m just trying to get all their money.”
But the real question that you have to ask as well, what do you want the results to be, and what is your current marketing budget as part of your overall income? Start breaking down and have a balance sheet question first to say, “All right. Well, how much does it cost me right now to find or keep one customer?”
If you can answer that, and have a look over the last two or three years in your business, you’ll actually start having more productive conversations about what can I afford to invest, and what do I expect the results to be?
So, when we talk about small budgets or large budgets, people still expect results. So starting with some of those goals to start with. How much does it cost you to get one booking via, for example, Airbnb? How much does it cost you to get one booking direct? How much does it cost you to get one person via social media or word of mouth? So, working out how much each of those channels are worth to you and then spending your money where you’re getting results.
So, refocusing that question rather than saying, oh, here’s a list of 10 shoestring ideas that you can just do for the smell of an oily rag. Go back and work out, “Well, how much did it cost me to get that rag oily in the first place?” And work out, “What are my goals for the next year?”
And your goals might have to change because of the lockdowns, because of the border restrictions, or you might have to build in massive contingencies because you don’t know what the next 12 months hold. But that’s 2021. Take the budget that you had last year or the year before and say, “Well, what results were we able to drive? Can we introduce some new activities? If we’re going to be sticking with a digital ad strategy, where can we reduce waste and where can we increase the results? Is this a DIY option for us, or can we pay somebody else to help us get better results?”
For some people, they’ve got the resources and the people, it’ll always be DIY. For everybody else, get some help. Get some professional help because you can turn your money and drive it harder, rather than just losing it down a hole called Facebook, or losing it down a hole called advertising on a local website that I don’t know what they do.
And always go out of your way to make sure that you know on a monthly or quarterly basis what your return on investment for that budget is. So, whether you’re spending $100, $1,000, $10,000 or $100,000, it’s the same ideas, they just get scaled. But it all comes back to your goals. It all comes back to how much does it cost me to find and keep one customer, and how many customers do I want this year?
If we go back to that first point I made, if you’ve got a premium product that you’re able to charge a little bit more for, it might cost you a little bit more to provide, what’s your profit margin in there? And can you actually make more by doing less? Isn’t that the dream, right? Let’s not focus on volume and let’s not focus on being busy. Let’s focus on being profitable and spending our money on those ideas that can actually help us breathe a little bit more. We can experiment a little bit more.
If international isn’t part of your plans for probably the next two years, honestly, two years is the time when the government is saying that international flights should come back on, what’s your plan for the next two years? Don’t go further than that, but what’s your plan for the next two years? Can you bring new products online? Can we have premium experiences? Can I work in partnership? Can I increase our distribution? And then, what advertising do I need to get them there?
Sage advice, and I’m pretty sure you’ll agree with this. We so often hear people wanting to talk about the tactics and getting excited about TikTok or influencers or what other people are doing, rather than actually sorting out the foundation and then making the decisions about what are the tactics that they actually should employ?
So, Todd, great chat. If Liz or anyone else who’s listening wants to get in contact and continue this chat, what can they do, where can they go?
Can reach us at Threesides.com.au. Jump onto our client contact form. And you can find us on LinkedIn. You can find me on LinkedIn, Todd Wright, or you can jump on… I’m sure you’ll be able to find about seven different ways of finding us. Or send us an email at email@example.com.
But website’s always a good place to start, or pick up the phone. Or if you’re in Canberra at any point, I’m very open to being bribed with gin, as I know that you’re also a fan, Daniel.