Cross selling and upselling within the tour operating industry

Cross selling is trying to sell the customer an extra product, related to the product they already bought. This strategy is very well known within the airline industry, but is it also used within the tour operating industry? And how are they using it? In terms of a tour operator, cross selling could be selling an extra service like a travel insurance, or an extension of the product with an extra destination within the tour.

Cross selling is very important during the growth phase of the relationship between the customer and the provider, to guarantee the development of the relationship. Different forms of cross selling can be defined below two headings; cross-selling over time and within the product range. Cross selling over time occurs when a customer buys two of more of the same product at one time, when a customer buys two of more of different products at one time, or when a customer buys a second or third product at a later time. Cross selling within the product range occurs when a customer within the same product category, or when a customer expands the products by buying a product from another category (Peelen & Beltman, 2013).

An example of cross selling within the tour operating industry is selling a cancel and travel insurance with a trip. TUI offers this kind of cross selling during the booking process with the choice of one or both of the insurances, the duration of the insurance, and the possibility the upgrade the insurance to all risk or comfort. Another example of cross selling by TUI is giving the option to not only book carry-on luggage, but also check-in luggage (TUI Nederland, 2016; TUI Nederland, 2016).

Upselling is also used within by tour operators. Upselling is trying to sell the customer an upgraded/more expensive product. Kras is upselling by trying to sell additional nights with their organised trips. For example with a trip to Andalusia, Spain, they give the option to expand the trip with three additional nights in La Cala de Mijas (Kras, 2016). TUI tries to upsell too, by offering an upgrade to a comfort class chair on their flight (Management Goeroes, 2014; TUI Nederland, 2016).

But how is cross selling connected with data usage? Companies use data they obtained to look what kind of products the customer already bought and what others bought. Websites also check what items the customer looked at earlier and give recommendations for cross sell products while their still shopping (Semmelroth, 2016).

Sources

Kras. (2016). Rondreis Spanje, Krakateristiek Andalusië. Retrieved September 29, 2016, from Kras: https://www.kras.nl/vakantie/searchresult.htm?kodquery=th.h.rr.1

Management Goeroes. (2014, January 4). Upselling. Retrieved September 29, 2016, from Management Goeroes: https://www.tui.nl/reserveren/verzekeringen/

Peelen, E., & Beltman, R. (2013). 9.2 Cross-selling. In E. Peelen, & R. Beltman, Customer Relationship Management (pp. 167-173). Harlow: Pearson Education Limited.

Semmelroth, D. (2016). How to use data driven marketing to cross-sell to your customers. Retrieved October 2, 2016, from Dummies: http://www.dummies.com/business/marketing/data-driven-marketing/how-to-use-data-driven-marketing-to-cross-sell-to-your-customers/

TUI Nederland. (2016). Reizigers & Bagage. Retrieved September 29, 2016, from TUI: https://www.tui.nl/reserveren/passagiers/

TUI Nederland. (2016). Verzekeringen. Retrieved September 29, 2016, from TUI: https://www.tui.nl/reserveren/verzekeringen/

TUI Nederland. (2016). Vluchtkeuze. Retrieved September 29, 2016, from TUI: https://www.tui.nl/reserveren/vluchtkeuze/

 

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3 thoughts on “Cross selling and upselling within the tour operating industry”

  1. Crosselling as such is nothing new Chantal and done for as long as the travel industry exists. It has always been and still is an important additional source of income, still predominantly generated in the (on-&offline) bookingflow. The question how to generate additional upselling throughout the rest of the Customer Journey is much more interesting. Modern technology offers great possibilities to provide the customer with relevant and personalized tips/services at the various touch points in the C.J (pre-trip/ in-trip) and as such enhancing customer engagement =>resulting in upselling. This needs investing in sophisticated CRM tooling, good content and adequate touchpoint technology to communicate with the customer.

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