Ever wonder what it's like to run a global tourism company? We did. So, we sat down with Casper Urhammer, CEO of Contiki Vacations. The company is part of The Travel Corporation, the family of brands that also includes Insight Vacations, Trafalgar, The Red Carnation Hotel Collection and Uniworld Boutique River Cruise Collection. Contiki specializes in tours for travelers aged 18-35.
Before taking over this position in September 2014, Urhammer was managing director of Groupon Australia and New Zealand and co-founder of Groupon Denmark.
He's also a world traveler, a trait no doubt useful in his present gig. He's lived around the world, launching business in the tech arena. And Urhammer's adventurous spirit (he's an avid skydiver) gives him something in common with the millennial demo he's charged with reaching.
Born and raised in Denmark, Urhammer holds a bachelor degree of commerce in international law. He lives in Geneva but spoke to About.com at the Travel Corp. headquarters in Anaheim, CA.
Contiki's credo is #NOREGRETS. It's a philosophy that certainly applies to Urhammer.
Q: You've not been at the job long. What are your impressions?
A: This is a very well-run business. Nothing is broken. Nothing needs to be fixed. We’re doing well. We’re taking something in a very good state and making sure it keeps growing. We’re lucky to have the demographic that we do. Everybody is talking about millennials these days. We’ve been working with them before it was cool. We’ve been doing this for 53 years. Our mission as a group is to catch them, foster them until they’re 35, then hand them over to our other brands. It’s incredibly important to stay relevant.
Q: Does your background in the technology space help you?
A: The execution and delivery of the product is low tech, but very good. There is so much expertise and knowledge in this company. There are synergies of course, with being part of a larger company that owns the value chain. People come to work for Travel Corporation and stay a lifetime.
All the things that I bring on board from a digital background, it’s about translating that into something relevant for this demographic. We're looking at things such as the tools that Millennials use. Everything we're doing is customer centric. We've had the same website for eight years. We're revamping it. We've done lots of research into how we will change it. We will make it easier for people to explore if Contiki is the right choice for them. We’re completely changing the technology. It will roll out beginning sometime in early 2016.
Q: Millennials do everything on their phones these days, don't they?
A: Yes and that's why we're actually building mobile first. It’s a lot easier to make things bigger for a computer screen that do the opposite. We are also refreshing our App. It will become a chat feed, you can chat before, after and during a tour with fellow travelers. You can chat with people who will be on your same tour. You have access to the itinerary, you will know the weather.The main purpose will be to stay in contact with the ones you travel with.
Q: What about the travelers who are even younger than millennials? Are you anticipating what is relevant to them?
A: It’s not just about the millennials. Gen Y is coming around the corner. So we need to make sure that the platform will last for five to ten years. But it also has to be agile and flexible enough to cater to what the next generation will want. At this stage, I have no clue what that may be.
Q: How have marketing strategies evolved to reach potential customers?
A: The days when you could put an ad in paper and wait for phone to ring are over. So are the days when you could simply just send out brochures. We’re doing content-driven marketing. We produce content. We work with influencers such as famous You Tubers. Last year we worked with one of the stars from Game of Thrones to tell a story on video and we distributed that video. That becomes content that young people can relate to. It's an interesting way for young people to learn about us. It instills brand confidence.
That’s how we market our product today.
Q: So you're saying that traditional advertising doesn't work for you any longer?
A: We’re content-driven and that can be user-generated content. Social media, videos, music. It’s an incredibly interesting space. The distribution we get on it is incredible. As an example, we do something once a year called The Road Trip. We take about ten famous You Tubers around with us. Some of them have millions of followers. One million views on YouTube is the same as a TV series on Bravo. It’s great distribution.
We take the influencers around the world. We give them a fantastic experience. They post videos and we get double digits of millions of views. That’s our way of reaching people and telling the story of Contiki.
Q: What other content do you produce?
A: We produce on an annual basis, 20-25 videos. We're working with very interesting guys who have a show on MTV. It’s called The Buried Life. It's 100 things to do before you die. They've played basketball with Obama. We arranged for them to have a beer with Prince Harry in London. That’s what the TV show about, young guys with an appetite for life. It's a perfect brand fit for us. We took them around Europe with winners of a competition called The Epic Bucket List. We had tens of thousands of entries.
We went through Egypt and Europe. We spent an absolute fortune to give these young people the time of their life. Imagine taking five people on their dream trip with their heroes that they’re used to seeing on TV. For us, that’s good marketing. Plus we ended up with great video along the way. Those videos are on our YouTube channel, it’s on the influencers channels. We spend a lot of money seeding it, pushing it to consumers through various channels. We spend the majority of our marketing budget on that.
Q: How effective is that kind of marketing? Do you have a way to quantify it?
A: Digital these days is all about mathematics. If you show this many videos, you know how many will click through to the website. It’s all mathematical. That’s marketing of 2015. But we aren't using technology for the sake of technology alone. It's all about giving people a better understanding of Contiki.
Q: So you aren't buying ads in magazines anymore?
A: If you mean ads in travel magazines, we aren’t doing too much. We're mostly consumer focused and online. Stuff you can click on to get to our website. However, brochures are traditional in our industry. They still have a lot of value for us. The average age of our customer in the US is 27. At that time in their life, when they go on a trip with us, it’s probably the biggest investment they have made. The brochure is validation that what they’re doing with their money is worthwhile. They will show their friends and discuss it, take notes.
The brochure is incredibly important. We have to be on the ball with it every year.
Q: Give us a sense of how extensive Contiki's operations are.
A: We have operations in 55 countries. We have sales teams in seven. We have digital teams, marketing and operations teams. The entire business reports to managing directors and presidents and then to myself. I have very smart people who are skilled at what they do. It's definitely a global business. I live in Geneva and travel 200 days per year. Toward the end of Europe’s workday, America gets up. And when America is going to sleep, Australia wakes up. It's all working pretty well. Year to date, we're up eight percent, flirting with nine percent.
In terms of actual numbers, that’s substantial.
Q: Where are Millennials traveling to these days?
A: We have a program called Japan Unrivaled. That has gained popularity like you wouldn’t believe it. It’s a bit of hot spot for millennials. You have to go on a tour there and we have the perfect program for it.
Sailing and cruising is also incredibly popular for us. We have cruises around Europe and Asia, I joined a sailing tour through Croatia. It was great to see the Game of Thrones locations and see the dolphins jumping all around in the water. We have about ten boats that we charter there. They are very comfortable and hold fifty or so passengers.
Q: Contiki introduced the Travel Styles concept last year. Is that proving successful?
A: It's really good. What we struggled to do before is diversify. We didn’t want to be classified in just one segment because we have 300 different trips. Travel Styles is a good way for us to explain that. It’s really helped us position ourselves. Some categories are more popular than others. Cruising and High Energy are two examples. But not everyone wants to get up early and stay out late at night. People want different things. That's why the Travel Styles were introduced.
Q: What about new tours? Is it important to develop them?
A: We're not coming up with a lot of new things. Some of these tours haven’t changed since the early 80s. They already do the right things. They go to the right sites. We’re so lucky and blessed. We have some incredible deals. We’ve worked with some partners since the company started. Sometimes it’s the second or third generation of the same family working with us. We have some incredibly strong relationships, especially in Europe. That's our oldest and biggest program. It can't be beat.
Q: So, the things that 18-35 year olds are looking for haven’t changed in half a century?
A: Indeed they have. But the Eiffel Tower is still great. We go to the popular destinations to see the popular sights. That still works. We may have changed some of the restaurants along the way and certainly market it differently. Some of the optionals have changed. We didn’t do cruising fifty years ago. We have certainly evolved. But the core of what we do and what we see has remained the same. The formula of people, fun and experiences remains the same.
Q: Do Europeans want to see the same things as North Americans?
A: The world is becoming a smaller place. For the traveler, that brings an opportunity to experience things that years ago would have been incredibly difficult. We started out doing European tours. That’s the foundation of Contiki. But today, we also have tours around Asia. You can go island hopping in Thailand. We have tours in Latin America. Not long ago, I was in Peru. I did the Inca Trail to Machu Picchu. This year, we’ve been licensed to do the four-day Inca Trail.
Q: Tell us about the Inca Trail.
A: It’s primitive. It’s what you would expect. I did the one-day version. When you walk the Inca Trail, you usually do it in groups. There’s so many animals. They hear you coming and they hide. I decided to run the trail. I was able to move in so quickly that the animals didn't have a chance to hide. I saw the most amazing things. Birds that you couldn’t even imagine. I saw brown bears standing. You just run around them. I saw red raccoons. It was a great way to experience it.
Q: It sounds like you're trying to experience as much of the tours as possible.
A: Every chance I can, I join a tour. It's so important to stay in tune with the travelers in their twenties. I tell people who I am. Usually they’re quite curious the first day or so. But after a day they couldn’t care less. I go to the bar and order a drink and sometimes people come over to chat. It’s a lovely time.
Q: Have you learned a lot from meeting your customers?
A: Yes, and it began on my first day on the job. I joined a tour in London and traveled with them for a couple of days. I met a lovely young girl from Arizona. She was literally the first person I spoke to. I asked her what her motivation for taking the trip was. She said to me, ‘Casper, I’m the first one in my family to leave America. I had a burning desire to take this trip. It’s not been easy because I don’t come from a wealthy family. I work at a Subway and I’ve been taking all my money and putting aside everything I can.
It took me four years. I even ate too much Subway and gained a couple of pounds. But I made it.'
Can you imagine how humbling that was? I will always keep her in my mind. Having that as the very first experience really was a gift. My biggest responsibility is to make sure that each and every traveler that goes on tour gets the time of his or her life.
Q: What about repeat and group business?
A: It happens a lot. But mostly we see people traveling on their own. More than half of the business, actually. It’s the perfect product for that. It really stimulates the group feeling when you’re on tour. Everyone can have a good time, whether you go as a couple or alone. As for our demographic, there's a natural limitation to repeat business. There's an element of it. We would love to increase it.
We find that first time or second-time travelers come to us and gain confidence. We educate them to become travelers. Maybe the third or fourth time, they will go on their own. Sometimes they make lifelong travel buddies on Contiki tours.
Our tours aren’t expanding that much. The main push will be staying fresh. The philosophy I want to bring is a concept I call the delight baseline. You want to ensure that all your brand touch points are above the baseline. Uber is very good with that. When the car comes it’s clean. The driver wears a suit. He takes good care of you. He sends you a receipt by email. Those touch points are all great.
We have a number of touchpoints, such as our website and App; call centers, tour managers. We have to be above the baseline in all of them. We need to find the points where we could drop below and them fix things. For example, we found that the place where we start our tours in London is not good enough. It doesn't convey the brand. So, we are changing things. We want to be Red Bull, Apple or Go Pro of the industry. Aside from technology we’re refreshing our brand so that every time you interact with our brand, it needs to be a delight.
Q: Are you planning to reach out to more travel agents about selling Contiki?
A: We're always looking for more trade partners. We still do trade shows. All the consortia we work with in one way or another. Small or large, I have an interest in all of them. They’re so important to us. I want to make sure we stay close to them and support them. Our American market has been bigger than it is today and we want to regain that business.
We have some plans for making it easier for agents to get the knowledge about Contiki. Right now we’re relying on our very good team of sales executives. We can’t reach everyone. Some people also have to reach out to us. Agents can come to us and we’ll tell them exactly what to do. The ones that want to work with millennials, we embrace them. Some of the most successful salespeople are in their fifties and sixties. I just met some agents that have sold more than 100 Contiki tours year to date. Imagine their commissions.
It’s not a low ticket item.