Thursday, 26 September 2013

The world-changer

The world-changer

By Arnie Weissmann
There are a handful of companies in the world that are recognized for extraordinary levels of customer engagement: Apple, Amazon, Starbucks and Zappos define the set and are much admired (and dissected) as models of New Marketing. 

It's hard to find a parallel in the travel space. The large online travel agencies (OTAs) such as Expedia, Priceline and Orbitz have certainly changed the travel-buying habits of millions of Americans, but as their leadership knows quite well, there's very little loyalty to individual OTAs. They built their brands on the promise of low price and were all too successful in training consumers to believe that smart travellers not only shop online but shop around. 

BRUCE POON TIP, world changerWhile there are many travel suppliers that can point to strong consumer loyalty, with enviable repeat business rates, the industry is generally very old school in its approach to marketing and branding. Loyalty programs abound -- after all, the loyalty concept started in the travel industry, with airlines -- but the innovative marketing that produces a deeper connection between buyer and product has, by and large, been absent, with Virgin being the exception that proves the rule. 

Though not well-known in the U.S., there is one travel company, the tour operator G Adventures, whose different approach to marketing puts it, in many regards, within the same corporate set as Starbucks, Amazon and Apple. 

It certainly doesn't belong there as a result of its scale. G Adventures claims a respectable, but relatively small, $250 million in sales from 100,000 passengers last year. But its founder and chief executive, Bruce Poon Tip, has nonetheless been invited to address Apple and Google employees on his approach to customer relations, has become friends with Zappos CEO Tony Hsieh, secured a meeting with Netflix CEO Reed Hastings to discuss corporate core values and been invited to give TED talks about his marketing philosophy. 

Last week, his book, "Looptail: How One Company Changed the World by Reinventing Business" (Business Plus, 2013) was issued as a major release. The title may sound over-reaching for a company that you might not be all that familiar with, and Poon Tip is not exactly a paragon of modesty within its pages. 

But if you live in Europe, Australia or Canada, where G Adventures is better known, the claims might not seem so hyperbolic. The U.S. is currently only the fourth-largest source market for the Toronto-based tour operator, a ranking Poon Tip is eager to reorder. 

Poon Tip has brought the concepts of customer connectivity and social enterprise to travel in a unique way. On the surface, some of what G Adventures does looks very familiar: It's certainly not unusual for a tour operator to integrate aspects of philanthropy, sustainable practices and support for a destination's cultural traditions into its programs. And many other operators have launched sophisticated social media plans. 

But Poon Tip's innovation is to permeate his company with 2013 values, from the urge to give back to destinations to ironic attitudes toward escorted tours, incorporating "fun" in the workplace and tapping into the longing for belonging to something greater than oneself. 

Did I mention that the Dalai Lama wrote the introduction to Poon Tip's book? 

Road trip

The Queen Violetta, alongshore at sunset.As part of his effort to establish a greater North American presence, Poon Tip invited nine industry executives and their significant others to join a jungle cruise on the Peruvian Amazon aboard the Queen Violetta, a riverboat he leased earlier this year. 


He wanted to tell this captive audience of travel agents and consortia executives (and one outlier, a product development vice president from Marriott Vacations Worldwide) the G Adventures story, provide a G Adventures experience and listen to the feedback. I was invited to facilitate an onboard discussion around sustainability and travel. 

Poon Tip is proud of the G Adventures product, but he freely admits, "It doesn't take a rocket scientist to run a great trip." His insight was to differentiate his product by overtly telling travelers, as the title in his book trumpets, "Go on a G Adventures holiday and you will change the world." 

Change the world. Not merely that you will support a project or that a portion of the proceeds will go to charity or that if you elect to reuse your towel you will help the environment. When you book a G Adventures tour, he explicitly states, you will join a community of world-changers. 

There is nothing subtle about his messaging. And Poon Tip has little but scorn for companies that make a donation to organizations such as the World Wildlife Fund and then receive permission to put the WWF logo on their brochures. He sympathizes with companies like Marriott, which purchased huge swaths of Brazilian rainforest to protect and preserve as an offset to its global carbon footprint, and Royal Caribbean Cruises Ltd., which hired a respected environmentalist to head up its sustainability efforts. But he cites these as examples of companies "retrofitting" to a sustainability positioning. 

While he believes retrofitting is positive, his company, he told the industry group assembled in the Queen Violetta's dining room, "transcends travel." By including dialogue that doesn't focus on the trip, travel advisers can avoid selling commoditized travel and differentiate themselves from Internet competition, he said. 

Guests had an opportunity to swim in the Amazon during the trip."When I speak at Google, they never ask me about the trips," he said. "They want to talk about branding." 

And the branding is often tangential to actual tour content. G Adventure slogans such as "I'm not a tourist, I'm a traveler," speak to consumer attitudes that also reject commoditization. And they transcend generational demographics.

G Adventures was until two years ago known as GAP Adventures. It changed its name after a long legal battle with the Gap clothing chain. For Poon Tip, "GAP" was an acronym for Great Adventure People, but it had also caused him marketing headaches because people associated the company with "gap year" travel, which appeals to recent high school or college graduates. He sees the change to a more age-neutral "G" as the one bright outcome of a bitter experience. 

Another example of Poon Tip's branding approach was a contest in which consumers were invited to submit ideas for projects inspired by the slogan "What will you do today, for tomorrow?" There were four categories -- beauty, community, knowledge and freedom -- and authors of the winning proposals, judged in an elaborate event among finalists in the jungles of Costa Rica, received $25,000 grants to see the ideas, which were not necessarily travel-related, through to completion. 

World-changers

To back the brand claim that G Adventures changes the world, Poon Tip created a foundation, Planeterra, which not only supports relief efforts in locales that G Adventures operates but engineers businesses that he believes preserve traditions, improve the health of local people, create employment opportunities and may support the infrastructure of his tours, from restaurants to lodges to centers where traditional crafts are showcased. 

Some projects, such as a home for street kids in Cusco, Peru, existed before he began supporting them and do not receive G Adventures passengers. But in other instances, the services of Planeterra social enterprises are supported by and integrated into the infrastructure of his tours -- but pointedly, not available to competitors. 

"They can start their own woman's traditional weaving cooperative if they want to," he said. 

A local family gathered turtle eggs in its dugout canoe to turn over to conservation officials for protection.A short list of other Planeterra-supported projects includes training street kids in Delhi, India, to be G Adventures tour guides; a program that includes guest stays in homes of aboriginal people in Australia; and a day school for kids whose parents have died from AIDS in South Africa. 

Then there are the one-offs, in which past passengers who feel part of the G Adventures community are tapped for help. A one-night circus with street performers in Toronto to celebrate the company's 20th anniversary raised $75,000 to build an eye clinic in Cambodia (they had already funded similar centers in Tibet and Tanzania), and after identifying a need for clean water in an East African refugee camp, Poon Tip sent out a tweet to his @PlaneterraCares followers and raised $100,000 in a weekend, he said. 

Perhaps the most striking aspect of Planeterra initiatives is that Poon Tip does not support them with his own or the company's money. They are financed primarily by G Adventures passengers, although he has also received grants. 

G Adventure's blurring of the lines between the profit and nonprofit world has not been without controversy. He says he was booed by nonprofits as he stood to make a pitch for a grant before the Inter-American Development Bank. But he walked away with a $1 million grant, the first for-profit company to receive the bank's funding, he said. 

Another of Poon Tip's talking points is wealth distribution. In its most practical application, G Adventures focuses on sourcing as many employees, contractors and supplies in destination markets as possible. He pointed out that he supported the builders of the Queen Violetta in helping them "break the cartel" that dominated shipbuilding and operating on that portion of the Amazon. 

The group of industry executives on this tour visited a local school on the banks of the river and distributed school supplies. Poon Tip said that G Adventures visits schools on a rotating basis to ensure that no one "model" village gets all the benefit nor becomes dependent upon riverboat visits. 

But on a larger scale, and more worrisome, he said that only 5% of the money travelers spend to visit developing countries stays in the country, and that reality builds resentment and hostility towards the industry. "The travel industry will be held accountable," he said, and travel sellers need to understand this issue and other issues that tie into his company's philosophical positioning. Travel advisers need to be able to "speak with authority" about, for example, ethical travel and climate change. 

"To say it's too complicated is to go back to selling commoditized travel," he said. 

Ethics are complicated

Complications arise when tours are actually being run in countries where not every citizen -- or local escort or hotelier -- subscribes to Western values, ideas and ethics. 

A G Adventures guide holds a 15-foot anacondas head down with a forked stick while a guest holds on to the tail.Just such a conflict arose on our trip. On an excursion, our excellent local guides, who were trained naturalists, came across an anaconda -- or rather, they spotted about five inches of snake skin showing through a hole in the ground. They told everyone to be quiet and gather around. Using a machete, one of them hacked a seven-foot-long forked branch so the forked end extended only about five inches. Not knowing where the snake's head might appear, they prodded it through the hole, and when the snake popped through the ground a few inches to the left of the hole, one guide used the forked end of the stick to hold the snake's head down. 

The rest of the 15-foot long constrictor uncoiled to the right, and the other guide, calling for assistance from the group, grabbed its tail and held tight. The snake was held stretched out for about five or six minutes, with various group members holding on. 

Toward the end of the display, Nicole Mazza, executive vice president for marketing at TravelSavers, said, "Haven't we bothered this poor snake enough? Let's let him go." 

I later asked Poon Tip, who was present on that excursion, about the ethics of interfering with a wild animal to that extent, given G Adventure's positioning. 

"I was horrified," he said. But, he added, it was a complex scene. While he would have preferred it hadn't happened, he said that what we also saw was a reflection of the native culture of the guides, both of whom were born in the jungle. For them, this sort of treatment of an anaconda would not be considered unethical in the least. 

He said one guest asked him "if we had stressed the snake. I'm not sure an anaconda can be stressed. Every day they're hunting, and they're hunted." 

To Poon Tip's point about native culture, the guides were very excited and proud of the incident, with one of them later citing it as "the highlight of the day," ranking it above piranha fishing, the sightings of pink river dolphins, swimming in the Amazon, visiting a shaman and viewing macaws, three-toed sloths and other wildlife. 

And indeed, that afternoon two local members of the crew who had stayed behind on the ship during that excursion saw that I was downloading photos on an upper deck. They approached and asked to see photos of the snake, and had me estimate how long I thought it was. They were extremely impressed. 

Poon Tip said that perhaps a better example of local culture vs. respectful treatment of animals occurred at a lodge farther south in Peru. The property was thriving on the business G Adventures sent its way but also kept a few jungle animals captive on site. One night, the owner, drunk, chased after passengers, swinging a small anaconda over his head. 

A brown capuchin, at right, approaches a resting howler monkey.Poon Tip immediately moved the business to another lodge. But later, the offending lodge owner wrote to say his business was failing and his children were going hungry. He begged for the business back and promised not to keep captive animals. At the same time, Poon Tip was getting reports that the replacement lodge had started to keep captive animals on site. 

He ended up first splitting the business between the lodges, then added another lodge that he helped to finance. 

In the end, he concluded, it was, at heart, a cultural clash between Western and indigenous values. 

"You can take the man out of the jungle, but you can't take the jungle out of the man," he said. "And at least they're no longer killing animals just so they can show them to passengers." 

Will agents sell the message?

On the final day of the trip, I moderated a roundtable among the industry guests. I was asked to focus on sustainability but found that I had as many questions about how the company was being received by this group of agents, who represented billions of dollars in leisure business. Some excerpts: 

Arnie Weissmann, Editor in Chief, Travel Weekly: Bruce appears to believe that your clients care enough about sustainability and related issues that you could sell a tour based to a large degree on your clients' capacity for caring. Do they care? And can you sell them based on that?

Karryn Christopher, vice president of marketing, Signature Travel Network:
 Not for all purchases. That's why you have a portfolio. 

Glen Wells, senior manager, Merit: I think most travelers wouldn't consider sustainability and the issues we've been talking about. But as travel agents, we have a duty to educate people. 

Industry executives gather on the deck of the Queen Violetta during their Amazon River cruise with G Adventures founder Bruce Poon Tip.Nicole Mazza, executive vice president of marketing, TravelSavers:When I think about vacationing with my family, I do not think about sustainability. Not ever. But quite honestly, after listening to [Poon Tip] speak and what the brand stands for, if I have to choose where I want to go around the world, it's going to be one that I look at first. [Poon Tip's] belief system, what [he] stand for, really piqued my interest. 

But clients and agents need to feel this spirit and be able to share it with their clients. I am predicting [G Adventures] will become very cult-like, what Club Med was in its heyday, and it still is, in France. Their clients keep coming back because they love what they stand for. It's what G is positioned to do. 

Arnie Weissmann: Will a frontline agent who hasn't heard Bruce speak in great detail about the company be able to convey the G Adventures message?

Christine James, vice president (Canada), Vacation.com:
 Our frontline agents can take control of that sale and then drive that message to clients who are socially and environmentally conscious. 

Pelin Karaca, vice president for product development, Holbrook Travel: In our experience, if sustainable trips cost more, it adds additional pressure. The tourism industry itself, the whole industry, should be elevated so that it should never be a choice between sustainable or not. For the most part, though, people leave their beliefs at home. They just like to travel. 

Tiffany Glass, vice president for e-commerce, technology and member services, Vacation.com: It's very tough to lead on sustainability, but there are a few niches where you could. We see it in the millennials, but the millennials are not users of travel agents at this point. We also see it among empty-nesters. 

Lindsay Pearlman, co-president, Ensemble Travel Group: When it comes to sustainability, you have to say, "Does the consumer really know what that means?" They'll hear statistics like "the new [Boeing] 737 is 30% more fuel-efficient" or "the new cruise ships recycle gray water." Consumers don't really know what that means. The opportunity with G [Adventures] is that it does mean something when a consumer is having this experience. And that could be a deciding factor on future purchases. 

Arnie Weissmann: Scott, you represent a timeshare vacation company with thousands of products. Can this be sold by a call center? Can your people differentiate this experience?

Scott Bahr, vice president for product development and strategic alliances, Marriott Vacations Worldwide:
 We have 700 or so call-center agents picking up the phone, talking to 400,000 owners and their families. I don't think you can lead purely with sustainability. However, the core values that G has matches what we represent to our customers, and from that perspective, it makes a lot of sense to start with, "Who is this behind the trip?" And then we could talk about the trips, because the trips are secondary. If you can't convey alignment of values to your agents, and then from the agent to the person on the phone, you've already failed. And in our portfolio today, we have nothing that matches this product in terms of experience. 

Arnie Weissmann: Would anyone else sell the branding and positioning of G Adventures, and then the vacation?

Christopher:
 You market the experience, but you don't necessarily market the brand, because there are a lot of ways to have those experiences. 

Arnie Weissmann: Bruce, you're nodding, but I'm surprised you're nodding. You link G Adventures to all these projects. Wouldn't you expect travel agents to start off with that?

Bruce Poon Tip, founder, G Adventures:
 I would love them to, but no, that's unrealistic. In many ways, we're the extreme on the sustainable scale, and that can scare people. It's a marketing challenge, where people might say, "It's for young people." "It's for people on a budget." "It's not comfortable." We have quite a bit of our own educating to do in order to get to a stage where our brand is omnipresent. We're doing everything in our power to be that strong, but we understand where we fit on the tourism industry food chain. We're a niche product, and we'll always be a niche product, and out of 10 clients that come into your office, maybe one of them might be remotely interested in an adventure product. So, it's our goal that when someone comes in and wants something different, that our name pops up, because we'll have something for them. 

Arnie Weissmann: Earlier today, Bruce, you said you wished you were selling something that wasn't a niche product. Do you believe that five-plus years down the road, you will be as large and well-known as, say, Trafalgar or Globus?

Poon Tip: Yeah, I do. I'm driven to grow this business, so I know that, organically, we can go to a billion dollars. 

Refining brand and corporate culture

Poon Tip claims that he has had month-over-month growth this year that was never less than 35%. In addition to what he sees as a unique branding position, one other reason he's optimistic that he'll hit $1 billion in sales is travel itself is on track to become the largest industry in the world, thanks in large measure to economic growth in China, India, Russia and Brazil. Poon Tip points out that the biggest challenge is that travel isn't going to scale equally -- it might double in Peru by 2020 but grow tenfold in China, so the challenge is to pick markets intelligently. 

A tiny poison dart frog rests on the palm of the hand of a G Adventures guide.But most important to him is the further refinement of his branding and corporate culture, and much of his time is spent focusing on employees. The G Adventures office in Lima, Peru, which is the company headquarters for South America, is filled with a bright, young, energetic staff. They might have meetings in the "Legos Room," which features a table filled with small plastic bricks, or interview potential employees in the "Michael Jackson Room," complete with a statue of the singer and Michael Jackson-themed wallpaper. Interviewees spin a wheel and must answer some questions that are certainly atypical in most job interviews, such as "What was your best Halloween costume?" and "Would you rather be rich or famous, and why?" 

Poon has boiled down his company's core values to five words: People, planet, profit, passion and purpose. "I met with the CEO of Netflix. Their core values are 14 pages long. But if you're a cook for us, you'd never understand them. [Our] values could work for anything. Our vehicle is travel, but with these same values, we could sell mood rings." 

It's easy to see why a publisher would solicit Poon Tip to write a book. His head seems to be bursting with business concepts that he can reduce to pithy advice ("Happy people drive your brand to success. The Four Pillars to Happiness are: Ability to grow, being connected, being part of something greater than yourself and freedom.") 

From an industry point of view, Poon Tip's lasting impact won't be measured in book sales. He might yet, as his title promises, change the way businesses operate, but those claims today are a bit reminiscent of President Obama receiving the Nobel Peace Prize in his first year in office. 

Long term, his greatest impact on the industry might not necessarily spring from customer satisfaction or growth rates. Rather, the question is whether he will shake up the corporate behavior of a largely tradition-bound industry segment: tour operations. Tour operators have certainly evolved over the past decade, becoming more experiential and marketed, in part, through sophisticated social media, but the companies themselves follow business and branding models that have remained largely unchanged for years. 

Mazza's analogy with Club Med might be the fairest measure of G Adventure's ultimate impact. Club Med's success was driven by concept, culture, engagement and experience, and its influences created a multibillion-dollar subset of hospitality: the all-inclusive. 

Companies built on social enterprise are taking root in many industries, and it's a model that could well proliferate throughout this decade. While it would be difficult for large operations to "retrofit" along the lines of G Adventures, it's not impossible that they would create subsidiary brands that mirror its approaches to branding, marketing and social enterprise.