Pack Your Bags

Peregrine Adventures

Since we last spoke to leading holiday travel specialist, Peregrine Adventures, there have been some changes to its business structure. Now part of Peak Adventure Travel – billed as the world’s biggest adventure travel company – the two Australia-based groups have been integrated and streamlined.

Steve Wroe is General Manager of the Peregrine, Geckos and Reserve brands. PEAK Adventure Travel Group is the world’s largest adventure travel company, a global collection of specialist tour operators and destination management companies. PEAK is the umbrella under which all the company’s brands sit, and includes The Intrepid Group, which consists of Peregrine Adventures, Geckos Adventures, Peregrine Reserve, Intrepid Travel, Adventure Tours Australia, The Family Adventure Company, Urban Adventures, and Sawadee.

Steve’s role, he explains, is to “ensure that each of the brands is functioning well from a sales point of view and that the integrity of each brand is retained”. Unchanged is the backing of one of the world’s largest movers of people on vacation – Europe-based TUI, which still owns sixty per cent of Intrepid. TUI is hands-off, explains Steve. “As long as we perform well, which we are, they let us get on with it.”

Peregrine caters for the middle of the market, in terms of demographics and age (typically mid-50s). Reserve, created in 2012, offers tours of a premium or luxury experience, while Geckos caters very much for the younger, budget-conscious traveller with a taste for fun and the exotic. Each brand is kept deliberately and carefully separate; however, the three brands share the same point of contact, as well as all other aspects of non-customer facing backroom activities, for added efficiency.

Originally, Peregrine itself was closer to that budget, youth-oriented market. But, as Steve points out, the brand has an extremely high repeat customer base and that has tended to pull the brand further up the age profile as its clients have aged, hence the room and demand for the younger brand beneath it. Geckos was designed to be easy to sell to the trade and leveraged the Peregrine brand to get it off the ground. “But, within a couple of years, Geckos took off and could stand on its own two feet without reference to Peregrine,” Steve shares.

The general aim, of course, is to entice travellers into the Geckos end of the market and then look after them and retain them through Peregrine and into Reserve – the company grows with its clients.

Steve notes that although Peregrine started off as a seriously adventure-packed holiday offer, it has of late tended toward the mainstream as a boutique alternative to the big coach-tour operators – softer and more culture-oriented, he explains. “The danger is that, if we continue to soften the brand and go more mainstream, it will reach a point where it will narrow the market.”

To be sure, tourism is a sector very vulnerable to consumer sentiment and economic climate, and Steve reports the last quarter of 2013 was “somewhat soft, especially at the budget end of the market”. Since the start of 2014, however, the budget brands have started to grow quite quickly. “We have definitely noticed the industry is very robust now and bookings are looking really strong.” The irrepressible Aussie dollar helps, too, in this sector. The Peregrine end of the market has remained more buoyant, with its financially secure clientele being “more resilient to any economic turbulence”.

Tastes change quite quickly in this leisure travel market and destinations come and go. Peregrine is currently seeing extremely rapid growth in the market for Central American holidays among its Australian customers (who constitute some eighty per cent of total bookings), “admittedly from a very small base, but South America has been powering along for a decade or so and continues to grow, spilling over into Central America”. Cuba, Costa Rica and other regional destinations are becoming much more popular.

Tour companies in the developed world, reflecting the demands of their customers, are increasingly engaged in sustainability and examine the ‘green’ credentials of destinations. In this case, “it’s very much about jungle and wildlife experiences. Costa Rica is a much more developed economy than most of Central America; it’s working very well”. Other countries in the region, notably Nicaragua, have been ‘opened up’ as backpacker destinations. As with many new destinations, operators of small tours – such as Peregrine – have followed the backpackers who are “often quite socially aware people. They laid some ground rules that have been adopted by a lot of the local tourism providers. They have set a reasonable standard for us to follow up on”.

Burma continues to be another success story. Peregrine was one of very few companies that engaged with that market before the relaxation of the dictatorship there. Nobel Peace Prize winner Aung San Suu Kyi continued to claim the tourism industry was supporting the junta and therefore wrong, but, “We took the view that using locally owned hotels, transport and restaurants meant that money trickled largely directly into the hands of locals, so the benefit was to them,” Steve explains. “But as a travel company we are not a moral arbiter of where people should or should not go; we made the decision to let people decide for themselves and I had a very strong view personally that it was beneficial, that oppressed Burmese people could gain exposure to Western ideals. Also, travellers would come back and talk about the plight of the Burmese and what their life was like, so it was a two-way benefit.”

Nearly three years ago, the lady who would soon become head of the country changed her stance. “Suddenly, all the flood gates opened.” Peregrine’s bookings went from dozens to more than 2,000 per year and are climbing still, though the Burmese market is now constrained by a lack of available accommodation (and consequently escalating costs). Is the industry ‘spoiling’ Burma as it has wrecked so many other destinations in the past? “The jury is still out, but I still believe we are operating in a very sustainable way. We are doing our best to lead by example with low-impact tourism.” The acid test will be how the government there handles capacity as it increases in the next few years.

Burma is the last jewel in the Southeast Asia crown, says Steve; Vietnam has been popular for some time now and Thailand remains attractive – though bookings to Bangkok are some thirty per cent down so far this year because of all travel warnings there. It could be worse – bookings to Egypt are down “much more significantly”.

Group travel is not under threat, Steve believes. Generally customers are looking for company, as well as the travel experience. He has in the past experimented with a less structured ‘group’ tour without conspicuous success – dropping the ‘tour guide’ and substituting a driver who speaks some English, for example, which saved on cost but proved unpopular. But there are changes within the definition. There is considerable growth in demand for FIT (Flexible Independent Travel) as people get more accustomed both to travelling far and wide and using the internet. Intrepid’s department catering to private groups has been growing at more than thirty per cent for the past five years. “We are also looking at modules we can offer for two or more people and capitalise on that shift. We are one of the first group tour companies to really embrace this trend rather than see it as a threat.”

But Steve does not believe the roles of his advisory staff (answering “where should I go?” questions) or the high-street travel agent are under immediate threat from internet bookings. There is a piece of industry jargon known as ROPO – Research Online, Purchase Offline. “We do notice an increase in bookings made through our website but they are still a relatively small number. Our web tracking is growing really rapidly, but people still tend to make the actual purchase in a more traditional way. Our product is quite involved – there are often a lot of questions – and it still tends to be a person-to-person transaction.”

Customer loyalty has been so high that Peregrine is, in many cases, able to simply recommend a destination and people sign up. “We have to keep on offering new ideas to keep people engaged.” Recent successes have included North Korea and a tour to Azerbaijan and Georgia. Repeat purchase is, says Steve, vital. “If our customers only travelled once with us we would go broke!”

For more information about Peregrine Adventures, please visit http://www.peregrineadventures.com.

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June 19, 2018, 8:15 PM AEST