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Know what not to change
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Overview Transcript Case Study Video
 
Stick With Core Customers

For Joan and Bill, some things have never changed and some things have never stayed the same. What hasn't changed is their focus on the independent international traveler. Yes, they'll help a customer who wants to go anywhere and in any way, but their focus is on the independent traveler.

This has dictated their product mix, their location and the types of employees they hire. It's even dictated the style of the business. When you visit their business, you feel it's independent, it's international, and it's all about travel. What has changed is the way they take care of these customers. They started by selling plane tickets. They added backpacks, and then a full-blown travel agency and a full line of travel products. They've been in three locations: a funky retail area, an upscale high-concept mall and now an historic building. Joan and Bill know what to change and what not to change.

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Key Ideas of this episode Small Business School
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1. Do What You Love
2. Start Small
3. Hire People Who Sparkle
4. Deliver Insight To Customers
5. Reinvent Yourself
6. Buy A Building
7. Invest In Your Neighborhood
8. Stick With Core Products
9. Stick With Core Customers
10. Respect Your Partner's Talent
11. Prepare For Unknown Unknowns
12. Deploy A Customer Retention Plan
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Topic for discussion: Who is the independent international traveler?

Answer: A person who will never take a group tour. This is the person who buys books and maps and dreams about adventure and who is willing to face many obstacles on a trip. They may not know for sure where they will sleep every night before they get on the airplane. On their own they will learn how to handle currency exchange, how to use public transportation and how to ask for help. This is not the person who wants luxury and who expects to be pampered.

Bill said when they first opened in Pacific Beach, their typical customer was about 24 years old with an old Volkswagen van. Today that same person is between 50 and 55 years old and is probably driving a Volvo. This older independent international traveler probably has more money than they had in 1977 but they still want the freedom to plan a trip and the adventure of making their own way in a strange place.

Topic for discussion: Is the independent international traveler a market niche?

Answer: Yes. A niche is a narrowly defined group of potential customers, and there are many niches in the travel business. The business traveler is a completely different niche than is the person traveling for pleasure. Then there are families with young children and families with teenagers and senior citizens that are afraid to travel without a doctor. Yes, these are all unique customer types who are being served by large and small businesses.

There is a great deal of material about market niches on our site. Andy Murstein, Bill Tobin, and so many others have said, "There are riches in niches."

Topic for discussion: Why do Joan and Bill do so well serving the independent international traveler?

Answer: Because they are members of this niche. To sell and service customers requires a great depth of understanding that can only be acquired from personal experience. The expression in investing is, "You have to eat your own cooking." This simply means, you should be your own best customer. Joan and Bill travel regularly and they don't take tours. They always plan their own trips the same way they teach their customers to plan.

You think about it: Is the market you go after too big? Too small? Who exactly is your target customer? Who is your competition and how do they go after this target?

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