The Extra Mile

Peregrine Adventures

Peregrine Adventures was originally set up as an Australian company, but is now owned 60 per cent by TUI, one of Europe’s top operators, and 40 per cent by the Peak Adventure Travel group (a consortium of some 20 companies offering various forms of adventure-style travel, founded by Intrepid Travel and now a joint venture with TUI since 2011). TUI is essentially a mainstream package tour company, making it a good fit for the more ‘rough-and-ready’ holidays offered by Intrepid and its entrepreneur founders, Darrell Wade and Geoff Manchester.

Peregrine’s younger (in every sense – founded more recently but also aiming at a lower age profile) Gecko’s Grassroots Adventures version is run as a separate entity.

This kind of consolidation is a feature of the travel industry, necessitated by the need for economies of scale but nearly always ‘back-of-house,’ so the consumer does not need to see the synergies. For example, Peregrine, Intrepid, Gecko’s and Peak are all run from the same Melbourne office block but retain their customer-facing individuality throughout the holiday experience – such as guides in developing countries who work directly for one or other of the companies, not for the group itself.

Glenyce Johnson, who joined Peregrine in 1999 as financial controller and assumed the role of Managing Director in 2005, says Peregrine retains its independent management. “In many ways the back end [of the business] has changed quite a lot, but at the front end nothing much has changed. We are very focussed on what we deliver in terms of product and growth – we really want to show people a different way of travelling. It has taken us quite a long time to get that message out there. Many people think our style is bungy jumping and white water rafting, but in fact it is more of a cultural experience.” That said, the company does also run active holidays – cycling, trekking, walking and so on, usually in groups (of up to 15 people to avoid the standard ‘everyone back on the bus’ kind of package experience). Companies offering the more extreme kind of adventure tend to cater for individual travellers.

Much thought and consideration has gone into ensuring that each of the brands, while served by many common facilities such as reservations and finance, “retains its integrity and they don’t trip over each other. You can clearly see the distinction between, say, Gecko’s and Intrepid. We can give the customer more variety,” which is increasingly what international markets demand.

A new upmarket Peregrine brand, Reserve, promises to “show you a world seen from behind the curtain. Travelled beneath the surface. Tasted from the kitchen, not the takeaway window,” and offers “intimate travelling parties and well-crafted itineraries, exceptional local guides who reveal the soul of a place, not just a postcard of it, and the most coveted accommodation and a manner of travel that embraces the passage of time, rather than fight against it.” The company says it has built on the experience gained with the Peregrine brand to work with its global network to create the Reserve range of trips. “These exceptional journeys take you beyond the highlights, and into the heart of a destination. Spend time with a local family, try your hand at cooking the cuisine and get off the beaten track. And do it all in style.”

Reserve is operating in a crowded and coveted sector of the industry – high-end exotic tourism – but Glenyce says the initial response has exceeded any expectation. In the very first month of operation, the brand attracted more than four times her estimate of what she “would have been delighted with” in terms of revenue. “With our brochure we are in something of a unique space. Our competitors out there are not doing it quite the way we are,” with butler service and authentic local guides, while she also points to the properties used by Reserve. “We really focus on small properties, typically with no more than 20 rooms.”

Glenyce takes a surprisingly traditional view of the role of the travel agent in the consumer process, away from the widely-held industry view that the agent is a kind of endangered species. She compares Australia with the UK, where some 80 per cent of the business of sister company Exodus comes directly from internet bookings. Here, over the last ten years, Peregrine has derived 70 per cent of its bookings from agents and that figure is static. “We are not seeing any real change. Our business is growing but bookings are growing from both direct and agent sales. Over the next five to ten years, especially with the Peregrine product,” with its ‘baby-boomer’ demographic of typically 55-65 year old customers, “I cannot see much change. They enjoy booking with the same travel agent – and we are happy with that because otherwise we would have to employ a lot more people to take the bookings.”

The company is satisfied with its current position, with its reps travelling to agents and training them in the products on offer so the agents themselves – and big operators such as Flight Centre and Jetset Travel Group – can advise the customer appropriately. “We have seen huge growth in people visiting our website and doing the research online, but they then like to visit their agent,” including the company’s own agency in Melbourne. However, the more they want advice on specific (and often exotic) destinations or activities, the more likely they are to want to talk direct to one of Peregrine’s own experts.

So what is this “different way of travelling?” This is not what the industry sometimes calls ‘fly and flop’ tourism, says Glenyce. “People that lead our tours want to share their country and their culture, so you get a history lesson on the way. You do so in a small group and immerse yourself in the country and its culture,” which is what consumers are increasingly interested in doing. There is also an increase in the number of customers taking family holidays of this type; “what used to be a school-holiday trip to Queensland or Perth has in many cases become a family journey of a different type. In some cases it will be three of four families – not necessarily known to each other previously – who will travel together, to Africa or South East Asia, while the Middle East is also quite a popular destination.”

The current strength of the dollar is only partially responsible for this change of taste; Glenyce says there is clear evidence of growing demand to experience different cultures first-hand. “Many of the families, when they return, say it was a great educational experience for their children to understand how cultures differ and how many countries around the world are struggling. They see this education process as an important part of their upbringing.”

By definition, travel keeps moving. The recent deal between Qantas and Emirates presents Peregrine with a whole new series of opportunities, and Glenyce believes, “we have a wide range of product in Europe and the Middle East – places like Oman, for example, which are increasing in popularity. The deal will really create a lot of business for us.” She is sanguine about carbon taxes and European-style flight surcharges. “The upside is that a trip to Europe is still about what is cost 30 years ago; a trip to South America used to cost twice as much as one to Europe, but now it’s nearly the same.” But she reminds us that the companies who buy air travel – the tour operators – don’t make any money from it because the airlines are so in control.

Tour operators the world over work on very small margins. Gecko’s, with its younger customers, is the more price-conscious brand but price is not the prime driver of choice in the Peregrine sector of the market, which has a comparatively high loyalty factor. “Our clients are very loyal,” says Glenyce. Another differentiator between the two brands in that the Peregrine traveller is typically time-poor and can only take a couple of weeks whereas the Gecko’s customer is more likely to take a couple of months to tour more thoroughly.

TUI is a world leader in the field of sustainable tourism. In Europe, tourists are driving demand for holidays that do not have a negative impact on the destination, its people or their way of life and those destinations that fail to move with this demand are threatened long-term by a severe drop in incoming revenues. Glenyce says Australian consumers are also demanding sustainability. “It is a huge step forward. It’s about awareness as well as focus and I think it’s fantastic. We have to constantly review our product offering, constantly research the places where we have agreed to stay, modes of transport and so on and once you start using the words ‘responsible travel’ you need to bring a massive focus to bear on it.”

Responsible and sustainable tourism is something that can be audited using global guidelines and is not at all a form of ‘window-dressing.’ “Health and safety is also a focus – not only for clients but also tour leaders and for the properties we choose.” The company even goes as far as auditing airlines – if it does not meet TUI’s standards for things like carbon footprint, it is not used. “This can be a challenge in some countries, especially considering internal flights.”

Glenyce voices concern over one rapidly emerging destination: Burma. “We were sending 30 people there a year, now it’s a thousand, and we are wondering what we can do to help because I fear it will be overrun by tourism and that would be such a shame.” But Glenyce and all her staff are serious about making sure they not only do not contribute to the blight caused by irresponsible tourism growth but continue to advocate and practise the highest and most conservation-friendly operations all over the world so that the very thing they promote – the local cultures – are retained for future generations of travellers.


Making Sense of Management

Management is the art, or science, of getting things done through people. Sounds fairly straightforward – except for the fact that people are not robots waiting to do our bidding. People have their own minds, motivations, and goals. So how do managers keep operations – and the people behind them – running as planned?

December 19, 2018, 5:31 PM AEDT