Richard Turen
In mid-September 2013, I did an interview with former Virtuoso marketing executive Keith Waldon about his opening a new agency model in Austin, Texas, which he was calling the Departure Lounge.
On Feb. 16, the Wall Street Journal discovered the Departure Lounge, and it ran an article headlined, "No, really, that's a travel agency."
In June 2011, two years before I interviewed Waldon, I wrote a piece comparing the traditional travel agency model with that of an Apple Store.
It began, "When the final obituary of the travel retail sector is written, I trust that careful note will be made of the role agents have played in creating stores and sales environments designed to remove any vestiges of joy and pleasure from the buying process."
My frustration with the failure of our travel retail environment to keep up with the needs and personalization desires of our customers is something I've been interested in for two decades. With the exception of the Departure Lounge and a few other concepts I will mention, the travel agency remains a stodgy, outdated retail blast from the past. Who in their right mind would want to enter such a mind-numbing emporium of tedium?
I'm always happy when the Wall Street Journal follows up on a Travel Weekly report, and the truth is that they took the space to reveal a good deal about the success and focus of Waldon's experiment. The agency is located on an upscale shopping street in Austin, a coffee bar by day and a wine bar after dusk. Here are a few takeaways worth noting in the Journal story.
- Sales are conducted by an outside staff of 38, who work by appointment. Many live within a few blocks of the agency. If a customer wishes, he or she can have a meeting set up in short order at one of the private tables along the side of the 2,000-square-foot space.
- The Departure Lounge's average transaction is around $10,000, and the business is so successful that Waldon will be opening two additional locations in the Austin area.
- The space has outperformed projections as a multiuse place where travel-related functions can be offered in the evening, when most working folks are in a frame of mind to discuss travel.
I know that Waldon thinks long and hard about what he's doing, so it is worth paying attention when he tells the Journal that "95% of our clients have never used a travel agent before," then follows up with the observation that "83% of the customers who do sit down and talk with a consultant end up purchasing a trip."
Of course, one reason I'm a fan of Waldon's agency model is that in many ways it is not unlike my own. The idea that we are salespeople and product reps is dated. We have to share our expertise, always taking the client's side as an advocate, not as someone who has sales tricks up their sleeve. And we have to be subtle. You learn what the Departure Lounge does by reading a section of the menu or reviewing your bill. The bartenders are well-traveled and comfortable discussing worldwide destinations.
One more thing: There are no charges involved in booking travel at the Departure Lounge. Revenue is derived entirely from commissions -- and, I suspect, from a slight markup on two of the most profitable products in the world: coffee and wine by the glass.
As Robert Silk reported in Travel Weekly in November 2015, one of the country's largest agency groups, Travel and Transport, opened a Travel Design Lounge in the Shops of Legacy in Omaha, Neb. The Lounge features in-house tablets and several huge TV monitors and serves craft beers, liquor, wines and hors d'oeuvres. Several more such stores are on the drawing board.
One of the features of this kind of agency/bar space is staffing by "navigators," who greet new guests with an overview of what is possible within the space. The idea is that it can be a space for clients to relax with a drink while taking the time to think about booking something as knowledgeable agents work in the background, happy to conduct an individual consultation.
I think it is worth noting that while different in details, both these models chose to use "lounge" in their names. I really think they are onto something, the idea of providing a mini-lounge or vacation space to those considering going somewhere in the future. One of the failures of our industry has been our unwillingness to create an environment where travel dreamers can dream peacefully while knowledgeable dream makers are available in the background.
There are some other attempts to redefine the agency experience outside of the U.S. that I want to share. One of the most interesting is the opening of the Travel Experience Space in Shanghai. It has been developed by Zanadu, one of the most successful Chinese travel and luxe lifestyle brands.
This is essentially a virtual reality travel store, the largest agency space in China. Clients can visit hotels using VR headsets or their own smartphones. There are 20 interactive destination cubes where travelers can browse digital books. Trips can be booked digitally or with the assistance of the friendly, on-site staff. Visitors will receive an upmarket magazine called Zanadu Travel Life, every page of which has a QR code, a scannable barcode image that allows smartphone users to link directly to a specific booking page.
Perhaps the most obvious way to build a new kind of consumer-friendly agency is to partner with Starbucks.
In 2012, L'Tur, the huge German travel agency, teamed up with Starbucks to create a new kind of retail experience, with two very different businesses sharing the same sales floor.
Located in an upscale shopping mall in Baden-Baden, L'Tur was attracted by the fact that Starbucks coffee drinkers seem to take a while to enjoy their beverage, a perfect opportunity for customers to glance around and notice that they are also in a functioning travel agency.
L'Tur is one of the most aggressive travel retailers when it comes to cross-selling and marketing. Several years ago, it saw that Hamburg's red-light district was attracting rather large crowds, so it launched a travel agency that is only open in the evening, complete with a full bar, located on the famed Reeperbahn.
I think it's fair to say that one would not expect to look to the seaside village of Hunstanton along England's beautiful but sedate West Norfolk coastline for a sign of innovations in the travel agency concept. The seaside town has a certain Victorian charm, and vacationers can enjoy popular local attractions such as the Crazy Golf Pitch-and-Putt or the tranquil Esplanade Gardens.
But down on High Street in the middle of town is the Destinations Travel Agency & Coffee Shop. In describing what it does, Destinations suggests, "Whether you're planning your perfect breakaway or just want to come relax and escape the cold winter, we can accommodate your every need."
In an online review, one clearly satisfied customer wrote, "Being able to sit in comfort with a gorgeous hot chocolate or latte and discuss holiday requirements with no pressure is brilliant."
They don't do hard sell in Hunstanton -- and that might be the takeaway here. There is a small revolution taking place as an alternative to the high-pressure tactics of OTA call centers. An increasing number of consumers are growing tired of the travel business as usual. They want change. They want respect. They don't want a sales pitch. They want to relax in a calm setting that fosters thoughts of faraway dreams.