After recently holding its first Australia and New Zealand face to face Owner-Managers Forum since 2019, Virtuoso is now laser-focused on maintaining the momentum of reconnecting and activating its network and its partners in anticipation of international borders reopening. I caught up with Virtuoso’s Senior Vice President, Michael Londregan, to find out more.
Anyone who has met Michael ‘Mike’ Londregan in his distinguished tenure of working in the travel industry will tell you that he has an innate gift for regaling stories that resonate.
In his opening address at the recent Virtuoso Owner-Mangers Forum in Sydney, Mike spoke passionately of the need to redefine the word VIP and for every Virtuoso travel advisor to embrace their own responsibility as industry leaders.
“You are all VIPs, but there should be a different ‘I’. You are all very influential people. The industry and market will be looking for important and influential people. So what I’d like you to do over the course of this Forum is figure out how you’re going to power your influence to lead,” He said.
I caught up with Mike to find out more about the Forum, the state of the industry, and the role all travel advisors need to play as we move towards the arrival revival.
How was the Forum for you?
The Owner/Managers Forum was a great success and we’re really glad we did it.
Before the event, I felt that while our members were busy managing their cash flow and their bills, their customers were perhaps not hearing from them and were getting on with their travel lives without them.
As we move through the recovery, many of our businesses are still tied up in managing survival. And we need them to do that, of course. But we need to find a healthy balance of allocating enough energy to survive, with plenty of energy to re-engage with the market as it gets ready to travel again. Because if we don’t, clients will find a way to solve their travel problems without us.
So, we had to find a nice way to put on an event that told everyone, “Let’s get ahead in the game. Let’s show them we’re open.” If you’ve gone out to lunch, flick the sign around to open. Closed is okay, but ‘at lunch’ is not okay anymore.
We’ve got to start showing clients we’re open and then the other thing of course is to let them know what we can do for them.
What were some of the key takeaways from The Forum?
Everyone was thrilled with the idea that we are the leaders that create momentum, and we will buy into that. The biggest fear is that the borders don’t open up quickly enough before losing all of our intellectual property, which is our talent. So we’re all worried about that.
This industry is very high on expertise and knowledge, and experience, and it’s very human. And if you go for too long, they will leave to do something else, and you can’t get them back.
We will have a shortage of people as America is already seeing, where agencies are recovering now. But they’re working until midnight because they can’t find good staff and because a third of the good staff went and did something else, and they’re just not coming straight back.
So, we’re going to have a problem. The same problem that we see already in the domestic hotels with no one to clean the sheets and cook the food, and we’re going to have that problem in the agency side of the business for sure.
How can we fix it do you think?
We need government support geared around payroll, not turnover so that we’ve got some way of keeping our talent somewhat employed in the business. That way, we can dial them back up instead of having them go down to zero.
The minute they get into zero, they’re gone.
Plus, professional development. If we’re going to survive, this industry will have to get involved in professional development. And if we don’t, we will die.
You don’t necessarily need a 25+ year experience story. But, even if you’ve only been here for a year, you must have a story about the genuine value proposition you’re bringing. So maybe if you’re brand new to the industry, you’ve got a great story to tell about Australian dive holidays because that’s your path and your passion.
But you’re going to need an angle. You’re not going to be able to say, “Well, I sit at a desk, and I can do stuff that you can do on your own computer.”
That’s what we’re doing at Virtuoso. We see our nation’s desire for high-end luxury, leisure travel, and we’ve got thousands and thousands of hours dedicated to that.
We don’t make money when we invite someone to talk about customer segmentation. We don’t have a supplier pay us for that. What we do have is a like-minded community of partners and advisors with a similar fixation on exceptional client experiences that, in turn, allows us to create a business model to redevelop that into professional development.
You talked a lot about the power of influence at the Forum, can you explain a little more about what that means?
What advisors need to understand is that they have a powerful influence. And the most important influence is that if the best managers in the retail travel sector are saying powerful things about recovery, that will actually accelerate recovery. So they are part of the algorithm of recovery. They’re not a victim of the algorithm of recovery.
They are part of what owner-managers are saying, what advisors are saying, and what partners are saying; that’s a really influential part of the algorithm of recovery. As important as what Scott Morrison or the media are saying. I often think that advisors underestimate their influence.
Because if advisors are saying that what we need to do is all get vaccinated, by telling everyone they meet in the street, it’s the way that your business is going to come back. The way your business is trying to get back is by you creating a groundswell of people getting vaccinated.
If you’re going to ring your MP, say to them, “I don’t want to talk to you about another government handout package; I want you to start saying you can’t go to the State of Origin unless you’re vaccinated.”
How do we reinvent what a Travel Advisor is and should be in 2021?
Virtuoso President Matthew Upchurch said, “I think that we pivoted in America from saying travel agents to travel advisors because we didn’t want to be seen as an intermediary.” Because the minute that technology helps you book it yourself, if all we are is stockbrokers, I can buy and sell stocks myself, so we have to become travel advisors to help you do it.
We need to understand that travel agencies need to pivot their thinking from a distributor of products to service providers. We still think we’re a retail shop, but actually, we are an advisory business.
So you better understand that you are in the advice and service business, not the product distribution business. And it’s a phenomenal part of the equation. Because once a client says, “I really value what you do,” at some point in time, the advisor will get the absolute joy of knowing I worked for my client, not my supplier.
How do we do it? There’s only one way, and again, that’s training and professional development. That’s it. It’s not a marketing campaign; it’s not a trick. We’re not going to say, “You used to call us agents and now we are advisors.” It’s not a jingle and a song.
We’re going to help our people become more professional at what they do to have stories that actually explain what they do and the narrative and to become damn good at it. And unfortunately, there’s no simple button to going from someone who distributes products to someone who sells their advice. The intermediary step is training and professional development. If you’re not willing to do that, don’t reinvent yourself.
And that was the flavour of our Forum. We had four workshop sessions; we had the best leaders of domestic tourism to help our members be more professional. We ran internal training, and we had two external speakers talking about customer targeting and customer segmentation. Only one-fifth of our workshops talked about travel product, four-fifths was about being a better advisor.
Will people pay fees to use Travel Advisors?
The general public has a great comprehension of what paying for fees looks like. Just not in travel.
Many in our industry don’t understand that humans have a complete understanding of how money is made because most of them have rubbed up against having to make money at some point in their life.
If you went to all of the agents in the industry as a potential client and said, “I’ve been recommended to work with you. But before I trust you, work with you, share my travel dreams with you and invest tens of thousands of dollars over my lifetime with you, I would like to understand how you make money?” Perhaps 90% of agents would squirm and say, “Oh, look, I can’t really explain it, you don’t pay any extra, it goes into this mystery box, and I keep some of it; it’s complicated.”
Now, if that was your mechanic, would you trust him?
However, if you asked me, “Michael, I’m thinking of joining Virtuoso, can you tell me how you make your money?” I’d say, “Matt, I’d love to tell you how we make money. In fact, I’m going to come and bring my P&L and show you.
“At the heart of our business, we are an engaged community of the best of the best and we are transparent about that. The region’s best luxury travel advisors focused on layering value for their clients. And we do this through advisor and partner investment in our events and marketing.
“Also, through our advisors’ unrelenting commitment to professional development, which in turn adds significant and material value to our partners, who themselves are the best in their field. Moreover, we have a very thin overhead here at the corporate office.
We don’t have people standing around clipping tickets which means we give 100% back to our members.”
And I totally understand that.
Now, if you don’t like the way we make money, don’t join. But I don’t want you to think it’s a mystery. Because I’m not embarrassed by it. And the biggest point is that we must stop being embarrassed about charging for our knowledge and expertise.
What’s your message to the industry in light of no certainty around international borders reopening?
If you’re open for business, be open for business, be prepared for business, be talking to your customers positively about the travel story.
If you know they love food and wine, be heavily engaged in conversation with them about it, domestic food and wine product and New Zealand food and wine product.
Start talking to them about travel, tell them that you’re open, sound excited about getting them back into travelling. Start talking to them about, “Hey, listen, I know the borders are not open, but what are the three big things you’d want to do as soon as they do?” Start getting that multi-year, multi-plan relationship started with deadlines.
I understand the pressure of advisors paying their electricity bill, but you can’t afford to allocate more than 30% of your time to that task.
You’ve got to spend 70% of your time being open, talking to your customers, getting them excited about travel, leaning to positive influence because if not, no amount of survival mode is going to ensure you survive.