Make your job easier with 8 key statistics
As a tour operator, you’re wearing so many hats sometimes you hardly have a minute to eat lunch. In what world do you ever have time to run reports and analyze business data? Not only that, but how do you know which statistics matter and which ones are a waste?
I get it, I myself have a love-hate relationship with quantitative reporting. Looking at the wrong numbers can be just as misleading as looking at no numbers at all. But here’s what I love about it: when you arm yourself with the right data, your business will improve, no doubt about it. When you take the time to gather quantitative insights about your business, marketing becomes much less of a guessing game, and much more strategic.
And that’s where this article comes in. In 7 minutes, I’ll help you narrow down the most important booking data that you need to keep top of mind and show how you can use those stats to improve your business. And guess what, all of these statistics can be found without ever setting foot inside of Google Analytics! (Sorry to you GA fans.) That’s right, you only need your booking data and Excel.
To get the most out of your data analysis, you’ll want to compare the results year over year to look for changes at similar points throughout your season.
The first five stats will revolve around the common theme of booking channel insights. In plain terms, a booking channel is just the method that someone chooses to book your tour or activity: online, over the phone, via a distribution site like Groupon or Viator, etc.
The last three stats will test your sales and marketing efforts: Do the add-ons you offer contribute meaningfully to your overall revenue? How many bookings do you discount?
If you’re looking for a How-To article that will walk you through all the steps of analyzing these stats, check out this post. If you’re still trying to wrap your head around booking and marketing data in the first place, what stats to consider, and why they matter, then stay put. That’s exactly what this article is for.
By the end of this article, you’ll feel confident–dare I say it, excited–about analyzing your tour’s business data. In turn, your bottom line will thank you. Being able to analyze and act on data allows you to spot marketing sinkholes and funnel more resources into strategies that will actually work.
Say goodbye to marketing as a guessing game and say hello to marketing as a science.
Booking Channel Statistics
Stat #1: Bookings by volume
If you don’t know what percentage of your business comes through your website vs. over the phone or in person, let’s begin there.
Whether you’re in your first season or your twentieth, this is how you start to get a sense for your customers’ buying habits I usually try not to be too prescriptive in my articles, because diff’rent strokes for diff’rent folks, right? But there’s no debating this point: if you have online booking software, you should strive to get the majority of your bookings online. And that’s for a couple important reasons:
First off, your website can take bookings 24/7, with multiple bookings happening at the same time, all at no cost to you. In other words, getting more online bookings is like giving your business a big, ol’ cash injection. (Be careful though, that’s only true if your booking software doesn’t charge you an online booking fee on top of your credit card processing fee.)
Secondly, why are you investing time and money into your website–why have online booking software even–if it’s not driving sales to your business?
If you don’t yet have the majority of your bookings coming through your website, you’ll want to make sure that online bookings are increasing in correlation with overall increases in your business. If you’re having a record season, but your online bookings are the same or lower than the year before, figure out why.
Stat #2: Booking value by channel
Knowing the popularity of your booking channels is one thing, but there’s another side to this coin: the value of your booking channels. For starters, you’ll want to know the gross value of your back office and online bookings. By all means, drill down as much as you’d like though. When I help businesses with their reporting, I look at how much money they make from mobile shoppers that book with a smartphone or tablet. I also pay attention to how much revenue the company gets through automated lead remarketing, or “rescued” bookings.
Stat #3: Average purchase and group size by channel
We’re not through yet, though. The next step is to move from cumulative figures to averages. You might find that the majority of your bookings come online for instance, but you discover that phone reservations are more lucrative on average. Why? Well you calculate your average group size by channel and realize that big groups book over the phone more than they book online.
But you don’t stop there. As a result of these averages, you run a little experiment with your phone answering system: You decide to record a message (like Zip KC) that reminds groups that they can book just as easily online as over the phone. In turn, you see a spike in the average value of your online reservations. Not only that, you start to take more of these high-grossing bookings online without relying on someone to answer every call.
Remember, you’re not crunching all these numbers to kill time. All of these statistics should illuminate key insights about your business. They should help you questions your current practices and experiment with new ways to run your business more efficiently and successfully.
Stat #4: Days between booking and arrival by channel
Timing is everything, right? Operationally, there’s a big difference between a tour that services a ton of walk-up customers versus one that gets most of its reservations a week in advance. This statistic can help you plan for the booking ebbs and flows.
Stat #5: Cancellations
Cancellations pose a big risk to your business. As you’re going through all your channel stats (volume, value, averages, days, etc.) you might want to inspect these statistics for unfulfilled reservations as well. The more you can establish a profile for commonly cancelled reservations, the more you can institute policies to better protect yourself.
For example, maybe you discover that vast majority of cancelled bookings happen to be phone bookings made over two weeks in advance. To hedge your risks, maybe you decide to require a deposit for reservations that fit this description.
As a business, it’s important to diagnose your failures just as much as your successes.
Alright, you’ve conquered the first portion on booking statistics. Now we’re going to shift gears and look more closely at your marketing and upselling efforts, namely your tour add-ons and coupons.
Tour Marketing Statistics
Stat #6: Add-ons as a percentage of your revenue
Add-ons are a great upsell tactic, especially for tours working on slim margins. You can start to judge the efficacy of your add-ons by comparing this revenue to your tour’s total revenue.
If the percentage is low, what might it take to make add-ons a more successful sales tool? Is it worth purchasing and storing inventory like T-shirts, water bottles, etc. if they generate a paltry sum? Could you better market your add-ons to prospective customers on your website and social media profiles, or through Google AdWords, even? These are just a few questions to get you thinking critically about your add-on efforts.
Stat #7: Most popular add-on by volume and value
You can’t fully evaluate your add-on program before you know which add-on(s) is/are carrying the team. I’ll show you a couple examples from some zip tours that I recently analyzed.
Zip Tour A:
|By quantity||As % of add-on revenue|
|SHORT SLEEVE T-SHIRT + TAX||19%||20%|
|TRUCKER HAT + TAX||1%||1%|
|TRIP PHOTOS + TAX||46%||60%|
|BUFF + TAX||1%||0%|
|LONG SLEEVE SHIRT + TAX||8%||12%|
Zip Tour B:
|By quantity||As % of add-on revenue|
|Helmet Cam – Basic Rental||58%||44%|
|Helmet Cam – Plus Rental||12%||13%|
|Helmet Cam – Deluxe Rental||30%||43%|
Now what I look for are add-ons with a disproportionately positive impact. Take a look at Zip Tour B’s “Helmet Cam – Deluxe Rental” for example. It’s only 30% of purchases, but it’s 43% of all add-on revenue! That means that even a modest increase in Deluxe Rental add-ons would cause big waves on the balance sheet.
On the flipside, most people opt for the “Helmet Cam – Basic Rental” but it doesn’t generate the majority of the add-on revenue. That’s a mismatch proportionately-speaking. If your tour company faces a similar situation, what could you do to move the economics more in your favor?
One last interesting thing to note. You’ll see in Zip Tour A that this business offers a “Ranger Tip” as a possible add-on. For this add-on in particular, I’d mix in some of that channel analysis that we focused on in Stats #1-4. I’d want to see the difference in revenue between Ranger Tips purchased through the online checkout and those purchased in the back office. Chances are that most back office Ranger Tips are added after the tour, and therefore, after the customer has felt the full value of your guides and the experience. If you find that customers tend to tip better when gratuity is added in the back office, I’d simply hide Ranger Tips from your online checkout and advertise it more strongly once the customers are on-site.
Stat #8: Coupons & discounts as a percentage of your revenue
I personally love the psychology of using coupons as a business tactic to acquire new customers, nurture one-time buyers into repeat patrons, and more. But the same thing goes with coupons and discounts as with add-ons: you’re looking for disproportionality; no one wants to sell their tours short.
It’s hard to know how many customers were convinced by your coupon and how many would’ve purchased your tour no matter what. That said, as long as the percentage of bookings with coupons is higher than the percentage of revenue you’ve sacrificed, I think your coupon campaigns are in the clear. For instance, if a third of your bookings have coupon codes applied to them, but all those discounts only amount to 15% of your revenue, that’s a healthy relationship.
To wrap things up…
All these statistics give you more insight into your customers and their booking experience–how they book, what they book, and when they book. That’s rule #1 of marketing, after all: know your audience.
Use these insights to challenge your current business and marketing practices. Ask questions and test new (data-driven) hunches on small scales. Your experiments might just point you toward a richer or easier way of running your tour. Let me know what happens by finding us on Facebook or Twitter!