Cross selling analysis contributes to higher revenue for the tour operator industry!

1Cross selling analysis is a key component in the revenue generation for tour operators. In order to cross-selling products and services, it is important to become customer-oriented and have a full understanding of all the customer’s purchasing behaviour as revealed through his or her sales transactions (Ed Peelen, 2013). Sales transaction data is stored daily in databases, named ‘’knowledge discovery databases’’. On these databases, association rules are being put into practice: describing and finding the underlying purchase patterns in the data (Ed Peelen, 2013). A great example in the tour operator industry is the cross selling of the ‘’Holiday-package to a certain destination’’ and ‘’car rental possibility’’. The association rule indicates how regularly the purchase of a holiday package to a destination is followed up by the purchase of a rental car (Traveltaintment, n.d). If an high amount of costumers are doing the same purchase with the same follow up, patterns are being detected that can be considered to be reliable for cross selling. The final cross selling will benefit both tour operators and costumers. Tour operators can sell more products, which are individually more difficult to sell. This will generate higher revenue. For costumers, cross selling contributes to the experience that necessary products and services are assorted in a manner that it can be purchase quickly and efficient. This extra full service can distinguish tour operators from its competition. Moreover, it contributes to building relationship between both parties (Molenaar, 2007).

Cross selling is mostly defined in the tour operator industry as ‘’Ancillary services’’. Ancillary services are key to helping travel suppliers find ways to better respond to and serve travelers’ needs for additional services or amenities in order to have more enjoyable, productive trips (Forrester Consulting, 2011). A great example of a successful tour operator who conducts cross selling/ancillary services is TUI. On the website of TUI, Travel insurances, and the possibility of adding weight of luggage’s are being are being cross sold on their website. Moreover, the websites offers costumers the possibility to book smaller excursions at the destination, which are frequently visited/booked by other travelers. From information stored in the database, TUI gains knowledge rearrange their website in a manner that after the selecting of an holiday package, different ancillary services are being offered before closing the transaction (Molenaar, 2007).

It can be concluded that the cross-sell analysis cannot be missed in the tour operator industry. Knowledge of buying patterns gives the tour operators in the opportunity to gain competitive advantage. Moreover, tour operators can use this knowledge this knowledge to determine which customers should be approached for a cross-sell effort (Ed Peelen, 2013). The success of this can be essential to the maintenance and development of their costumer relationship.

 

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One thought on “Cross selling analysis contributes to higher revenue for the tour operator industry!

  1. Carla van den Berg-Brantjes

    Ancillary services are indeed becoming more and more important for the industry to increase margins, although offering those upselling products should not disturb the online booking flow and conversion should be very carefully monitored .

    Like

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