Cruise Week recently visited the Seattle headquarters of Holland America Line for interviews with two veteran industry leaders – President & CEO Stein Kruse and Executive V.P. Marketing, Sales & Guest Programs Richard Meadows. The executives spoke out on a number of issues of interest to travel professionals, with the bottom-line message that the relationship between supplier and retailer has changed.
"The point is that the agency or consortium or national account is not a seller in the traditional sense anymore, they're more of a marketing partner with the cruise line," says Kruse. "The agencies that understand that and work on how they're going to market our product through their special knowledge - whether it's through groups and affinities or organizations, whether it's their way of direct mail or utilizing direct mail that we provide - the agencies that can tie all this together are the ones that are going to prosper and do well and adapt to whatever the new structure looks like."
Both executives say utilization of supplier electronic tools is critical. "Less and less efforts are being made just to throw something out there and hope it will stick," Meadows. "There's much more of a thoughtful, deliberate plan behind what's being done. And that's really good. They can take our tools - whether it's email or direct mail - leverage them, and put them out in the market. We'll help them to understand what’s an acceptable return. There's much more awareness at the individual agency locations - not just national accounts, but at the single office level - that all marketing activities must have a payback. Everybody is sharpening their game."
Yet there are still agents who say time-tested marketing tactics, like newspaper ads and brochures, do have a place in some markets, and the reduction in support for those pieces by suppliers is part of a bigger push to foist more costs onto retailers. Kruse responds: "We can't carry the cost of inefficiency; if there is waste in your system, you'll want to take the waste out. You can't afford to continue waste just because somebody's antiquated business model is predicated on waste."
Kruse notes that commerce changes at a faster pace today. He pointed to the array of brochures in his office as an example: "Our planning cycle is so far out that almost by the time those brochures come out we are making changes in things that may have an effect in terms of sales. So brochures, in a sense, they're not becoming obsolete, but their current presentation formats are near obsolescence." Meadows pointed out that requests from consumers for brochures are way down. “So the demand from the consumer to have that piece of paper in the form of a brochure is changing."
Meadows says agents sometimes overlook supplier investments that aid retail business. He points to the new Mariner Reward Loyalty Program launched last year. "How that benefits the consumer is pretty obvious, because depending on their level, there's a whole series of things they can enjoy when
they sail with us again," he says. "But smart agents are also embracing it, because they realize it's another thing that helps drive business back in their door. For example, if someone is a three-star Mariner and they're one cruise away from their four-star status, that agent is going to tell them, 'You're this close to four star, which for the rest of your life is going to give you these series of benefits.'"
Kruse emphasizes the breadth of tools available and advises agents to use any of HAL's 38 BDMs to help point the way. "If you look at the toolbox that Holland America has for your average agent out there, it is so vast, it is so enormous, yet I don't think that the average agent probably has a clue what is
available."
Kruse says he's proud 11,000 agents have graduated from Holland America Academy, but there's room for plenty more. “The fact that in all the years we've had Holland America Academy we still only have 11,000 graduates tells me that there are tens of thousands of travel agents who are out there that have not gone on Holland America Academy and have not tried to understand our product, to learn about our brand and sell Holland America."
