Question

Topic: Strategy

Trouble Differentiating My Tour Business

Posted by miguelcsoares on 250 Points
I started a tour business in one of the Azores islands 8 months ago, offering day tours and hiking tours.

The main attractions of the island are places of great natural beauty, like the volcanic lakes, volcanic springs and the shoreline. There are also places of cultural interest such as a tea factory and the pineapple plantations.

There are dozens of companies offering roughly the same 3 day tours, covering various attractions in one day. Many of these companies are very new (there was an explosion recently) but there are also a few established ones with great reputation, dominating on Tripadvisor.

As for the hiking tours, there are some official trails maintained by the government and many companies also offer them because they offer as many services as they can.

I'm trying to find ways to differentiate my business, (because otherwise I think I'm dead) but not sure about the best strategy to follow.

Here's some possibilities I've thought:

1) Focusing only on hiking tours for a more specialized market. The official trails are relatively easy and there's a few nice ones that I know about.

The problem here is maybe narrowing the market too much. The island has a growing number of visitors, but not the huge numbers of other destinations.

2) Offering more authentic day tours that make people feel less like tourists and more like Azoreans. For example, some of us Azoreans boil eggs and make tea in the boiling hot springs. I could bring some eggs and tea bags/cups for my clients.

Main risk here is imitation (100% sure it would happen) and losing my special factor rather quickly.

3) Just focusing on better brand image and digital marketing content. Most of my competition have relatively poor websites and social media marketing. I already have much better imagery than most of them and I'm pretty sure I can have a better online presence and understanding of digital marketing than most of them if I put a lot of effort in it.

I would love to know your opinion on this and any different suggestions for a good strategy.
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RESPONSES

  • Posted by Jay Hamilton-Roth on Member
    As you noted, if you find a way to differentiate your business, you're likely to be quickly copied. So instead of finding something novel, consider focusing on highlighting your customers' experiences with you. Lots of testimonials on your website and high ratings on social media-based travel sites. Basically distinguish yourself through excellence - making it easier for customers to choose you from among that multitude of tour businesses.
  • Posted by Mike Steffes on Member
    If your customers tend toward the younger side of the spectrum, try to keep in mind that they are most likely focused on getting an experience. So, sell them the benefit they're looking for. Stress the Experience inherent in each of your packages. Give them something they'll talk about.
  • Posted by Peter (henna gaijin) on Accepted
    Of your 3 ideas, I would not do idea #1 just yet. This targeting would also limit your market, as you noted, and unless you know you can do that well enough and still get enough reach, I wouldn't do it.

    Idea 2 brought back memories of Japan where you can eat onsen tamago (eggs boiled in natural hot water), so caught my interest. It seems cheap and easy enough that I would add that to what you could do as a bit of local flavor for your guests.

    Idea 3 was the one that stood out. If you think you could do that better than your competitors, I would focus on that.

    Other that that, most tourist related businesses need local advertising/promotion. Fliers at hotels/airports/tourist info spots, advertisements in local magazines and on local tourist maps. Are you using those? Are your competitors? Unfortunately, these are not cheap methods, but they are effective.
  • Posted by miguelcsoares on Author
    @KSA
    Thanks for the suggestions.

    I agree with everything you said about the website, it was just rebuild recently to make it mobile friendly and some aspects are still unfinished.
    For example, the hiking tours and packages pages will have more tours added soon, that's why they look a bit empty now.
    Adding About Us page is definitely a priority.

    I've thought about naming tours thematically. For example "A Day Among Volcanoes".
    But I also think that most people travelling to the Azores quickly learn the names of the main attractions (such as Furnas, Sete Cidades or Fogo Lake) and those are the words that sell in the end, even from an SEO perspective.

    @Peter
    Thanks for commenting my ideas.
    Actually, I also think idea 3) has the most potential.

    The only problem I have with 3) is a conceptual one:
    I don't think "better digital marketing" is a competitive advantage in the marketing school books, but I may be wrong.

    I keep thinking that I should have a more traditional competitive advantage (such as price, differentiation or niche focus) and then market around that competitive advantage.

    If my website looks better and is more user friendly and I have better content on social media, is that enough even if my tours are similar to my competition?

    Maybe it is, because this type of business has very few repeat sales and being found 1st by 1st time visitors is very important. On the other hand, a focus strategy can create a lot of word-of-mouth. For example, there are many hiking clubs and associations and members could be saying: you have to go with Miguel, he's the best for hiking.
  • Posted by miguelcsoares on Author
    @KSA
    Yeah, I'm using "Discover the True Nature of the Azores" as the tagline, but I'm open to change if it's not a very good one.

    I actually like some of your suggestions.
    I may change to one of them with your permission :)

    Maybe "Meet the Real Azores" instead of "See".
    I also like "Get the Authentic Azores Experience"
  • Posted by saul.dobney on Accepted
    A bit of a brainstorm:

    Many holidaymakers will be relying on their hotel or their rep to provide them with information or guidance. So first thing is can you build relationships with the hotels - packages which the hotels then resell, or commission fees paid back to the hotel, or with transportation companies. The reps often work direct for holiday companies, so can you get to know who's in and out at the start of the season, and put together something exclusive - a tour followed by a meal for instance. If you can find well-connected partners, you'll be able to make sales without competitors latching on to what you're doing.

    There's also a need to be first, so can you promote at the airport arrivals. This can be direct advertising, someone wearing your company's t-shirt handing out leaflets, liaising with the private transfer companies etc.

    On advertising, you've presumably got leaflets in the local tourist offices and bus stations and spready around hotel lobbies. But you can be creative too - golf clubs, scuba dive, scooter hire places or physically handing out leaflets along the main strip (with a call to action - eg 10% discount if booked tomorrow).

    You might include advertising on the side of local taxis (or your own vinyl-wrapped vehicle), some PR in a visitor magazine (or in-flight) if it's not too expensive. Run a market stall selling photos (or other goods) also advertising the tours. You might find a local travel writer willing to write about your tours - or look for bloggers announcing they're travelling to the Azores and offer them a free tour.

    Tripadvisor and Fodors will provide information to customers so become an informed advisor on their sites (but don't overdo self-promotion - become trusted). Google Ads targeted by location at visitors actually in the Azores shouldn't be very price competitive.

    You might also want to think about how you grow. Linking with others (eg boat trips, fishing) you can benefit from being a bigger combined force to smooth out ups and downs and give yourselves a strong sales proposition with things like guaranteed satisfaction, tourist quality marks etc.
  • Posted by miguelcsoares on Author
    @saul.dobney
    Thanks a lot for your great post.

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