If I had to choose one topic that gets the most attention and causes the most amount of heated debate, it’s the topic of charging fees for entrepreneurs selling travel. Recently, at GIFTE’s Book More Travel Workshop it was discussed by two of our very own travel entrepreneurs, Trish Gastineau and Jennifer Round who have successfully implemented their own service fee policies. Thank you Trish and Jennifer for sharing your wisdom! If we had allowed 3 hours for questions fielded at them, it would not have been enough time. The most common responses to charging fees tend to be 1) “I’m afraid to ask for a fee” 2) “How can I charge a fee when my competition doesn’t?” (this is very common for Disney specific travel experts) 3) “Charging a fee is greedy” 4) “It’s difficult to charge my long standing clients a fee when I haven’t been doing it before” or 5) “I don’t know what’s an appropriate fee to charge or how to ask for it, so I don’t.”
In essence, the resistance to charging fees boils down to a sense of scarcity and under valuing your worth. Let’s figure out where this comes from. I believe it comes directly from one simple thing, called online booking engines. There is a very distorted perception which causes an inaccurate response.
Before online booking engines existed, sellers of travel served as one of 2 distribution sources for travel. Travel agencies actually controlled distribution and information like flight schedules and availability. If a consumer wanted to book travel, they had 2 choices – call the airline, hotel, or tour operator directly or call a travel agent.
The emergence of online booking engines changed this dynamic AND the role of the travel agent. Within 1 or 2 years, the distribution channels for travel multiplied exponentially. Instead of having 2 options for booking travel, the consumer now has thousands of options. From a micro economic point of view, there was a substantial increase in supply without a matching increase in demand, causing price to reduce.
I believe this is the root cause of a lack of worth in many entrepreneurs selling travel. The perceived “scarcity” of clients booking travel, relative to the options they have to book that travel, has made many travel sellers underestimate their worth.
The shift to fully valuing your worth and thus consistently charging fees begins with recognizing your CHANGE in ROLE. As a seller of travel, you are one of many distribution channels and no longer a controller of the channel. In essence, you are no longer a booker or an agent. You ARE an expert. And many people are looking for the advice, opinion and guidance of a trusted expert. The problem is that you market like a travel agent, so you are putting confusing stuff out there. Start marketing like an expert! How? With information instead of products; by telling your story not your longevity in the travel business or the consortia you are associated with; by nurturing relationships with clients through heart felt connection and not the energy of needing the business. It all comes down to establishing a core compelling message (and you can learn about this in the Make Money Selling Travel Blueprint.)
The next step to charging fees is getting super clear with your numbers. My clients who have the “numbers awakening” experience often have a 180 degree shift in their attitude on charging fees. When you get clear on your revenue goals, understand the expenses you will have and the aggressive sales goals needed to meet your revenue goals, you will realize that charging service fees is simply a way for you to maintain a viable and sustainable business. In other words, if your clients love you enough that they want you to stay in business, they will be OK with you charging service fees.
The last step in charging fees is to own your brilliance. This is a critical step because when you do it, you shift from a place of getting to a place of giving. Your clients will feel that. When you own your brilliance, you realize that it’s your duty to share your brilliance with people who need it most. So working with clients is an extension of you giving your gifts to those who need it. Without this ownership of brilliance, you will feel like you need the clients, need the business, and need them to pay the fee. It will come from a place of wanting to get something from them, NOT wanting to share something with them.
Once you have walked yourself through these 3 steps, you can use my service fee script to begin charging your service fees. You can find that script in this article: http://www.travelbusinessu.com/converting-price-shoppers-into-valuable-clients
Put yourself through these 3 steps and get on the path to charging service fees. When you have shifted your perspective on charging fees, I can guarantee you will never 1) be afraid to ask for a fee 2) question how you can charge a fee when your competition doesn’t (because you will know that your competition is on a fast path to making no money) 3) feel that charging a fee is greedy 4) think it’s difficult to charge your long standing clients a fee when you haven’t been doing it before or 5) be unclear about what’s an appropriate fee to charge or how to ask for it.