Luxury Travel Advisor caught up with Virtuoso CEO Matthew D. Upchurch recently to get the latest from the luxury travel network, hear his take on the future of the industry and more.
Here’s what we learned:
What’s New From Virtuoso?
In mid-September, Virtuoso launched the integration of its website, Virtuoso.com, and its travel dreaming site Virtuoso Wanderlist in an effort to combine “travel inspiration with traveler engagement in the dreaming and planning process.” Since making Virtuoso.com content-forward in 2020, web traffic, pageviews and time on the site have grown significantly, the company announced last month. Additionally, Wanderlist has exceeded $110 million in future travel demand, with 59 percent of list invitations sent by travelers accepted by their friends and family, making it a strong referral tool for Virtuoso travel advisors.
Beyond the integration of its website and Wanderlist program, Upchurch tells us, is the evolution of the latter. Originally intended to be “a multi-trip, long-term planning tool” that both gamified travel dreaming and created a database of information that advisors could then use to build a “life experience plan.” Upchurch likened the concept to how folks might use a financial advisor: “Why would you go to a financial advisor to have a conscious plan to optimize your financial assets, but not have one to do that for your most valuable, non-renewable asset—your leisure time?” he said.
When the pandemic hit, Virtuoso decided to make Wanderlist free. “That was part of our strategy of ‘How do you engage with customers in a respectful way when you literally can't travel?’” With the move, Virtuoso saw advisor use jump from 350 to about 3,500, according to Upchurch.
The move to integrate Wanderlist with Virtuoso.com not only allowed for more travelers—or potential travelers—to access to page and begin dreaming up vacations, it also allowed Virtuoso agencies and advisors to offer that on their private-label websites. The advisor can have their clients sign up, access all the articles, hotels, cruises, etc., and begin creating their own “Wanderlists.” According to Upchurch, this “creates an opportunity to allow the consumer to engage at a deeper level.”
In one such instance, Upchurch explains, a consumer who had never used a Virtuoso advisor previously, went onto a website, saw Wanderlist, signed up and over the course of a few weeks created eight different “Wanderlists.” They then called up the advisor and told them they wanted to start working on the first trip (which happened to be to Peru). “So, you now have a customer that you've never dealt with who's already giving you a ton of data about the kinds of hotels they like, the kinds of experiences they like, that then create a richer, more powerful experience.”
And this data, Upchurch tells us, is what makes the tool so powerful. “The difference is we have transactional data. This is about the advisor/client relationship creating a dataset that didn't even exist before because the advisor inspired the client to take some time and dream of it,” he says. “The activity of dreaming through the use of this tool now creates the world's largest database of aspirational desire. And then we are also able to turn around and as a network do what we do best—which is the genesis of this network—which is bespoke travel, and we're able to flip the marketing model. So, instead of the Virtuoso partners always telling us what they have to offer, we as a network start to understand what people want to do. And then we can turn around and provide the type of trips and experiences of things that satisfy those dreams.”
Lastly, Wanderlist allows clients to invite other people they’re planning or traveling with via email to access the “Wanderlist.” That email invite is coming from the person they know, not the advisor, so it becomes “a huge referral tool”—to which Upchurch adds, “the No. 1 way of getting new clients for advisors has never changed in my entire career: Referrals.”
The Return of Travel
The return to travel might as well be a Charles Dickens novel. Talking about bookings from the first half of the year, Upchurch says “it was a tale of two different types of travel: Travel within the year and traveling one year-plus out.” Travel booked for 2022 and beyond “was absolutely going bonkers.” Travel for within the year, however, was down between 40 and 60 percent depending on the type of travel. (Upchurch does note these numbers are compared to 2019, “the highest production year in the history of travel,” setting a very high bar for measurements.)
Virtuoso did see a slight dip in future bookings starting in the beginning of August through September, likely attributed to the Delta variant. He also noted the irregular travel restrictions and that he expects things to pick up as countries open up. Right now, he says, travel is primarily driven by policy. One very high-end traveler that Upchurch met in California told hm, ‘You people better be ready because there's only so much wine and so much furniture I can buy.’ He also notes that he has never seen such a disconnect between the shape of the industry and the overall economy, with equities and real estate being at all-time highs and travel still hurting. To that effect, though, he tells us that when the Biden Administration announced the U.S.’ reopening plans, bookings went up 40 percent that week. “So, I'm still incredibly bullish,” he adds.
One issue we’ve heard plenty about is the staffing shortage (across not just the travel and hospitality sector but in across the entire economy). We’ve heard from personal experience that a dining venue being closed might not be the end of the world but when service is severely lacking and travelers are paying for five-star service, that’s when there’s a problem. Upchurch says the way some hotels are dealing with the staffing shortage is by not opening up to full capacity. For instance, some are only opening two-thirds of its inventory because they feel they can only service two-thirds of its inventory and no more. He adds, however, that “some people have not been as good about that.” His advice to suppliers? “Be transparent about it, be open with it—because there are customers that are willing to still go there, know they don't have all the services, know that the prices are high, but they're also itching to get out.” And then this puts the onus on the advisor, Upchurch says (so also make sure you’re being transparent with your clients).
As far as client trends, Upchurch tells Luxury Travel Advisor that he’s seeing—especially among “really sophisticated travelers—people thinking longer-term. They’re taking the time to consider the milestone trips and those that they need to plan far in advance and spend the most money on. He likens it to the grade school science experiment when students are asked to fit rocks, pebbles and sand into a jar. “This all fits in the jar, but it only fits one way,” he explains.
Once you have the framework for the larger trips, clients are looking towards the “mid-size” trips—maybe a Spring Break, something important but not quite the milestone trip. Lastly, is the “capstone at checkout,” where a client might realize there’s a good deal in Cabo and there’s still availability.
“There is a little bit about that strategy,” Upchurch says. “It also goes to the bifurcation of booking right now: There's this last-minute or way in advance [planning]. It kind of goes with that, and … it's a great opportunity for advisers to up their game as to the overall value of what they do.”
He also tells us that people are buying up, “no question.” The top accommodations across the board are selling out first (which, again, circles back to the strong numbers for bookings one year-plus out). Upchurch adds that, with two years of remote work under everyone’s belts, clients are taking their families on much longer trips as they can now work from their travel destination. “I think that's going to be an interesting, almost ‘here-to-stay,’ kind of a thing. There's a great opportunity around that,” he says.
Another trend is the “creative tension between wanting to go to a new place I’ve never been before versus going back to the places that I have a deep connection with but seeing it in a different way.” Upchurch also says that more country-intensive trips are likely—not just visiting the major cities but the secondary and tertiary destinations within a country.
Message to the Industry
Upchurch feels that travel advisors not only have to become more efficient but more effective at selling travel. “In all my years of doing this, the most successful travel advisors have not gotten to where they are through pure efficiency. We all need to develop higher efficiency, right? It's like, duh. Of course, you want to be able to be more efficient—but I would also profess that you also want to be more effective.” By this, he means the optimization of your client portfolio. Instead of focusing on making your business 25 percent more efficient, he says to double or triple “those very top, best clients.” And note: By “when I say, ‘best clients,’ I don't mean just the money they spend, but the way in which they value you, respect you, etc., that make you want to get up and work for them.”
“So, right now, while more people want to use a travel advisor than ever before, there's never been a better time to actively ask your best clients for referrals, because also being a travel advisor has never been more stressful,” Upchurch says. “So ask for those referrals and then actively get rid of the clients that suck the life out of you. You've never had a better time to do that than now.”
Looking forward, he reiterated his bullishness on the outlook of travel. Upchurch pointed to the fact that five generations of travelers are currently out there and that the oldest generations are living longer than those in the past. And across the board, but particularly among younger travelers, Upchurch notes, is the trading of good for experiences (which is why companies like LVMH are entering the hospitality arena).
The recovery of travel won’t be even across the globe but depending on policy and health, Upchurch believe the industry could be back at the highwater mark of 2019 by the end of 2022. Until then, it might be a bit of a “popcorn market” with some areas popping up, while others might go down but the overall baseline continuing to rise. And eventually, the lid will pop off.
In all, Upchurch tells us, “I've never been prouder of this profession.”
He adds, “I think that as you go forward, be creative, self-care and make sure that you really focus on understanding your value and sticking to that, build up on that. That's the most important: Know your own value and build your business, build what you do, because we've made it through this horrible time. We have more opportunity we've ever had.”
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