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Luxury travel network Virtuoso is all about growth these days. Last year, membership grew from 20,000 to 22,000 advisors — most of which came from existing agencies bringing on new employees. The network also brought on 100 new agencies and 200 new suppliers, bringing the totals to 1,100 and just over 2,000, respectively. In all, Virtuoso agencies’ sales were up from $26.4 billion to a robust $30 billion — that’s a 14 percent increase, which includes all sales made by the agencies, not just with Virtuoso partners.
This year, Virtuoso is celebrating its 20th anniversary since rebranding from API Travel Consultants, the company that Matthew D. Upchurch and his father, Jesse, co-founded in 1986. In the early days, much of the network’s focus was on infrastructure, marketing and building its preferred partner program. Over the years, its aim has shifted to bringing consumers’ attention to travel advisors to helping them become a more profitable profession.
We caught up with Upchurch, CEO of Virtuoso, in February to gain insight on the luxury network. At the time of our initial conversation, 2020 numbers were impressive. Virtuoso was up 17 percent on cruise sales, 20 percent with on-sites and 50 percent for hotels. The attitude of luxury travel advisors was very good at the time, too. Optimistic, excited, energized, confident — those were Upchurch’s words. Eighty-four percent of advisors said sales would be higher than in 2019; 15 percent said about the same and only one percent predicted a downturn. This year was to be a banner year.
Sustainability for Upchurch “isn’t just the environment. It’s the preservation of cultural heritage and it’s making sure that we benefit local economy and the local people.”
The world has changed since February, however, and so we’ve stayed in touch with Upchurch to get his take on how the recent coronavirus challenge is affecting his network and the industry. To learn more, please see the bottom.
Challenges aside, Upchurch has a clear vision for travel advisors and for the luxury travel industry. “I think about what it was like 20 years ago, when everybody was wondering if we were going to be around,” Upchurch says. But not only are travel advisors still around, they are thriving.
What’s changed from 20 years ago, though, when so many predicted the extinction of the profession? “There’s been the long gestating transition of people prioritizing their spend on experiences versus goods,” Upchurch says. This is music to the ears of travel advisors. But Upchurch isn’t satisfied with just this — his goal is to make Virtuoso as efficient at helping advisors succeed.
One way Upchurch sees that happening is via the multibillion-dollar data warehouse that Virtuoso is building, which will help the network learn even more about its clients. Ninety-seven percent of members in the U.S. and Canada give the network their transactions nightly, and these numbers have allowed Virtuoso to do some interesting research.
One such highlight, according to Upchurch, was that “we were actually able to prove the efficacy of Virtuoso marketing on households.” By digging into the numbers, Virtuoso looked at whether their marketing grow spend or loyalty. “We were able to show that at the same income level, consumers that received Virtuoso marketing exponentially spent more,” he says. And due to “the really incredible relationship that we have with our partners, where our customers feel something different when they are taken care of by our preferred partners,” Virtuoso saw that loyalty grew, as well. “That loyalty then translates into greater spend and into greater loyalty and greater repeat factor,” Upchurch says.
But it’s not about pushing clients to more expensive options for the sake of getting them to spend more. “In fact, it’s the exact opposite,” Upchurch says. Rather, it’s about Virtuoso and its member agencies building relationships with their “judiciously” selected partners. “The quality of the relationships that we have built with these people creates a greater experience,” Upchurch says.
It would make sense, then, that if Virtuoso clients are spending more and are building loyalty with their advisors and the network, that they would be pretty satisfied, as well. Turns out, that’s the case. Upchurch says that Virtuoso is starting to get more and more evidence “that the network’s clients, when collaborating with our partners, have a generally higher degree of satisfaction with the experience and the product.”
This data and research are key for Virtuoso as it moves forward. It’s why they hired a new senior vice president of technology, Travis McElfresh. One of his new responsibilities will be to build the Virtuoso Cloud, which will be an infrastructure that allows Virtuoso to provide content and microservices “that draw from an unite the unique technological ecosystems of our very diverse members from around the world,” Upchurch explains. What one agency might need tech-wise from Virtuoso may be different than what a second needs, and perhaps a third uses the same info in a different way. Agencies aren’t run in a one-size-fits-all approach, and Virtuoso is trying to offer as much as it can to as many as possible.
“I’m super excited about the technological roadmap that we now have,” he adds.
One of the biggest technological endeavors by Virtuoso has been the creation and full launch of Wanderlist, which “is basically an innovation around an existing process.” As Upchurch explains, Wanderlist is “a very interesting combination of a tangible process with some digital tools to create and deliver a more consistent, repeatable value proposition that is embedded in the organic practices of really good advisors.” In essence, it’s a tool that combines the best practices of the top advisors to help them learn about their clients and create long-term travel plans. By mapping out what destinations and experiences a client would like to visit and accomplish, it helps advisors better get to know them and plan future travels for their clients.
“One of the purposes of Wanderlist is to actually enhance deeper, more meaningful conversations and relationships, while looking at the client holistically,” he adds. “It’s the ability to create and use technology to enhance interaction but without replacing it.”
A favorite saying of Upchurch’s is: “Automate the predictable so that you can humanize the exceptional.” Wanderlist aims to fulfill this mantra. “As an advisor, your core value is not the fact that you are able to book the trip,” he says. “Your core value is that you’re able to help me, my spouse, my family, have a much more thoughtful, purposeful plan to optimize my life experiences and my limited, most valuable, non-removable asset: my leisure time.”
An advisor’s job isn’t done once the trip is planned, or even taken, though. The difference between a transactional travel agent (“there’s nothing wrong with that,” Upchurch tells us) — and a trusted travel advisor is the conversation after the trip. And forget about simply asking, “How was the trip?” Advisors need to ask questions that help them learn about the client, so they can make the next trip even more tailored to them. Upchurch suggests asking, “If there was one thing you could change about that trip, what would it have been?”
Another benefit of Wanderlist is the creation of a new travel profession: the Wanderlist Guide. The guide works hand-in-hand with advisors to learn the Wanderlist tool, as well as best practices for engaging families in the process. Currently, over 200 advisors have gone through the full training since it launched in 2019. And should an advisor opt to not complete the full training, Virtuoso’s Wanderlist Guides are available to assist advisors case by case.
Working on the Wanderlist project gave Upchurch a “really good booster shot of travel advisor empathy.” He says, “We can all sit up here, high and mighty, and say travel advisors should do this and travel advisors should do that [but] until you really get down in the trenches and you realize that when you’re a travel advisor booking travel, you can wake up in the morning with all the greatest of intentions of being super proactive, but the reality is you don’t really own your time.” Clients change their minds. Flights get cancelled. Cruises change their itinerary. A pandemic is declared. All of the above.
“Trying to add a lot of proactive processes to what is fundamentally a reactive profession to the needs of the client and the realities of the marketplace is a challenge,” he says.
Leadership Team (from left): Seated: David Kolner, Matthew D. Upchurch, Michelle Rashid, David Hansen; Standing: Steve Kawamura, Mike McCown, Terrie Hansen, Albert Herrera, Travis McElfresh
In summary, being a travel advisor is tough and Upchurch admits it. But when something goes wrong and you save the client’s day, that’s when you really shine.
If there wasn’t already enough to be excited about, Upchurch adds the evolution of Virtuoso Communities to that list. Originally launched four years ago with four groups (Adventure, Family, Voyages, Wellness), two more were added last year (Culinary and Ultraluxe); 2020 will see two further additions: Sustainability and Celebration.
In addition, each Community will be segmented into various sub-groups based off transactional data. For instance, advisors who want to learn about a particular passion point; these will be “adventure-focused advisors” (or whichever Community theme you join). Virtuoso will offer these advisors special programming, teaching them and growing their expertise in the particular area. Once you hit a certain dollar amount that puts you in the top 20 percent of producers, you’re labeled a specialist. At this level, the programming becomes much more individualized.
Communities are all about, “How can we become larger and feel smaller at the same time?” Upchurch says.
“Our organization has a very long history of being there for our partners and our members in the midst of all kinds of crises,” Upchurch tells Luxury Travel Advisor.
In past years, Virtuoso has pivoted the locations of its Symposium, an event designed for luxury travel agency owners and managers, to destinations hit by various disasters. In 2015, after the terrorist attack at the Bataclan theater in Paris, Virtuoso visited. In 2010, the network shifted its Symposium from Madrid to Mexico City after the city was hit hard by H1N1. It even visited Luxor after the massacre in 1997.
When the coronavirus outbreak was just that (only an outbreak), Upchurch says, speaking with Virtuoso Chinese members and suppliers was “pretty emotional” because there was “zero business.” Since then, the outbreak has been officially declared a pandemic by the World Health Organization and is becoming something “different and more widespread than anything we’ve previously seen.”
As a result, Virtuoso had to cancel its Symposium, scheduled for this past March. It was to be a big one, as the network was to celebrate its 20th anniversary as Virtuoso. The event was to take place in Vienna — just as it did 20 years ago when “Virtuoso” made its debut. Upchurch had plenty of exciting things planned that he hoped would “spark thought-leadership and insightful conversation amongst attendees.” He adds, however, “We may see such seismic shifts as a result of COVID-19 that what was true just six weeks ago is no longer the case.”
Nonetheless, Virtuoso will be there to support its agencies, suppliers and destinations when it can. “That became my passion 30-some-odd years ago,” Upchurch says. This mission became clear when he was in a meeting with a Chinese company that helps foreign entities set up businesses in China. They told him Virtuoso was not in the travel business, rather “in the professional consultancy and entrepreneurial support business.” Not only did it better serve Virtuoso in setting up business in China at the time, but also helped Upchurch realize the ultimate goal of the network.
It was a defining moment for Upchurch, who had spent his whole life in the travel industry (his father, in addition to founding Virtuoso, was one of the co-founders of the U.S. Tour Operators Association and a pioneer of the luxury travel industry). Looking back, he says, “If you were to tell me when I was 22 that I’d hang out with travel agents for the rest of my life, I might’ve run the other direction.”
But the industry changed. “It’s been so incredible to see how this profession has professionalized,” Upchurch says. “We were all basically human vending machines.” When API Travel Consultants made the decision to change its name to Virtuoso, this was one of the stigmas it wanted to move past.
With Family: Upchurch says consumers are looking for authentic and unique experiences but they’re also looking for fun.
During a time of airline commission cuts, online travel agencies (OTAs) and more, Upchurch felt advisors needed a champion. “The whole purpose of the brand name change was to create a spotlight on a category that was being maligned,” he says.
Upchurch wanted a pull strategy, “to create a brand that people understood — that’s what it was all about.” In that first year, Virtuoso’s public relations mentions grew by 400 percent. The name change “just created a kind of buzz,” he adds.
Soon after, many advisors received plenty of new business — but they didn’t have the hours in the day or the staff to handle the business. Some were on the verge of “tapping out.” Virtuoso had to change its mission; rather than focusing on bringing in as many clients as it could, it had to make the travel advisor a profitable and desirable profession. In 2001, Virtuoso’s mission statement became, “To improve the compensation and personal fulfillment of the frontline travel advisor.”
Upchurch recalls thinking, “If we do not make the profession of being a travel advisor a financially and personally rewarding career, that is our single point of failure.” Some advisors at the time were skeptical of Virtuoso wanting to dig deeper into their financials to learn how to better support them. However, the information was vital to helping Virtuoso fulfill its mission statement. And should you ask him what he’s most proud of having accomplished with Virtuoso’s members, Upchurch will tell you, “Hands down, it’s the fulfillment of our mission.”
But is there any, one secret to the network’s success? According to Upchurch, no. “It was the core, gravitational pull of everything we did. There was no crystal ball, I just kept trying to do the next right thing.”
Another mission of Virtuoso’s: “To create a global phenomenon and a global spotlight on a different level of advisor.” In other words: Create something larger than the sum of its (already successful) parts.
Twenty years after Virtuoso made its debut, Upchurch is looking ahead to the next 20.
While preparing for this year’s would-be landmark Symposium, Upchurch worked with three “innovation teams” that each comprised Virtuoso staff, advisors and agency owners, and Virtuoso partner representatives of the same generation. One of the focuses was co-creation. “Everything we’re about is co-creation,” Upchurch tells Luxury Travel Advisor.
“The whole idea is that at the core of our success is authentic human connection,” he says. Looking forward, Upchurch aims to find the answer to, “How do we build a human-centric operating system to take in knowledge and deliver real products and real value propositions that are relevant and desirable to different variations of customers?”
Upchurch adds, on the other hand, the power of the Virtuoso brand is growing with the consumer. “I have to say that even I’m amazed,” he says. So, having helped make travel advisors profitable and even a desirable profession, it’s once again time for Virtuoso to turn its attention to the consumer, where “you’re going to see us really up our game,” Upchurch says.
He tells us that it’s not uncommon for consumers coming to Virtuoso, wanting to find an affiliated agency. Advisors looking to work for a Virtuoso agency are pretty common, too, we’re told.
“Belonging” is something else that Upchurch is quite excited about. At the 2019 Virtuoso Travel Week, Chip Conley, strategic advisor for hospitality and leadership at Airbnb and founder of Modern Elder Academy, spoke about what it was like to join Airbnb, where his boss and all of his coworkers were half his age. That keynote helped Upchurch realize just one more mantra for Virtuoso: “There’s power in sharing wisdom and being open to learning.”
He adds, “You really don’t belong at Virtuoso if you don’t believe in the ethos that there’s more to be gained by sharing than there is in keeping to yourself.” Fortunately, Upchurch says, that many members of Virtuoso are firm believers in sharing and learning from each other.
“That’s why we are where we are today — because a lot of our veterans actually have the ego structures and the open-mindedness to listen to a 26-year-old,” Upchurch says. If you’re considering joining Virtuoso, just know you need “a willingness to share and co-create — takers need not apply.” In order to thrive and evolve the travel industry, its members must learn to accept teachings and suggestions from others.
“Cross-geographic collaboration, cross-generational collaboration — that’s what gets me up in the morning,” he says.
On the supplier side, Upchurch is most excited about “how quickly we’re starting to see movement on sustainability as a real component” of trips. While Virtuoso is going all-in on sustainable travel in 2020, as evident in the addition of the Sustainability Community, it has long been practicing and promoting sustainable tourism. To note, Virtuoso’s Sustainable Tourism Leadership Awards will enter their 10th year in 2020; in addition, last year, Virtuoso won the World Travel Award for its commitment to sustainable tourism. The awards, according to the World Travel Awards, “were established to recognize individuals, companies, organizations, destinations and attractions for outstanding initiatives related to the travel and tourism industry, and in fostering sustainable tourism and developing programs that give back to local communities.”
Upchurch notes, “Sustainability isn’t just the environment. It’s the preservation of cultural heritage and it’s making sure that we benefit local economies and the local people.”
The trend to more sustainable travel is a win-win-win — for the traveler, the advisor and the destination. “What’s exciting to me about this is how quickly we’re starting to move away from the model of, somehow, sustainability meaning lesser-than, giving up something or making it more expensive,” Upchurch says. In fact, “I’m seeing evidence from partners that are starting to show examples where sustainable practices actually created higher margins and greater loyalty,” he adds.
It’s always interesting to see how properties, for instance, will look for ways to stand out. Several years ago, Virtuoso partnered with YouGov to do research on the “commoditization of quality.” Basically, this means that over time things that may seem luxurious, for instance, eventually become commonplace. An example: 25 years ago, Upchurch says, Four Seasons began putting mini shampoo bottles in hotel rooms. Now, “the cheapest place” does this. (Although on the topic of sustainability, it seems these bottles are on the way out.)
Nonetheless, as the difference in quality becomes less perceptible because overall quality just keeps getting better and better and better, consumers begin making decisions based on a series of other factors beyond the quality that they expect to receive. These factors range from the consumer feeling that they and the brand align on values and impact to sensing that their employees seem genuinely happy to be working there.
Luxury is less and less about goods and more about experiences. How often have you heard that what makes or breaks a trip is the service?
It’s just one way the traveler is evolving. Upchurch adds that consumers are “more diverse than they’ve ever been,” specifically noting that five different generations are traveling for the first time in history. He says consumers are increasingly believing that they’re also experts.
“The old-fashioned value proposition used to be, ‘I’m an expert; you want to deal with me because I’m an expert,’” he says. “Well, the problem with today’s world is the minute you say you’re an expert, everybody wants to test that out. This is why with WebMD, doctors will tell you, ‘It’s the bane of my existence because everybody comes in and says they’re just as much as a doctor as we are.’”
“We happen to be in a space that’s dealing with the best educated, most successful, best traveled, most technologically savvy group of consumers in the nation,” he adds.
Upchurch suggests changing the approach. “I think one of the other things that’s interesting is vulnerability. I think that presenting yourself in a much more vulnerable and authentic way actually makes you more credible.” Advisors should speak with their clients, or potential clients, and be upfront. Say, “The world is changing really fast, I know a lot about this stuff, I keep up with it — but it’s not just my own knowledge; it’s the knowledge of my network, it’s the knowledge of my relationships.”
In addition to opening up about the people you rely on to create these trips, he recommends being willing to share how you make a living. (Regarding fees, Upchurch says there’s no right answer.) One advisor in the Virtuoso network, according to Upchurch, sits her clients down and says, “Look, these are the products I sell a lot and I’ve got great relationships. I get paid very well because I give them a lot of business. So, if you book XYZ, I’m your gal. And I don’t charge you fees because these guys pay me really well.”
“Creating that deeper connection at that more human level — that’s about transparency,” he says.
That connection on a human level is the key for travel advisors. “If you tell people that you’re in the business of booking travel, you’ve lost before you’ve even started,” Upchurch says. “There are literally hundreds of new ways that are being invented every day to make it easy to book travel.”
One pitch you can make is that you’re a specialist — and, no, not in a destination or type of travel (although niche training is something Virtuoso is clearly on board for). You’re a specialist in the client. “My job is to get to know you: What you want, what’s important,” Upchurch says.
You also serve as an entry point. Feel free, he suggests, to jump on a three-way call or video call session with your client and the supplier. Have them meet and speak to each other, which will help you all tailor the trip to the client. “It’s my job to utilize my knowledge, my network,” Upchurch pitches. “Booking travel is obviously part of what I do, but really it’s about optimizing your time.”
Consumers, yes, are looking for authentic and unique experiences but they’re also looking for fun. “Make it fun!” Upchurch says. A travel advisor should be a person that clients look forward to talking to.
“It’s also about inspiring,” he adds. Maybe your client isn’t coming up to you and explicitly requesting a sustainable vacation. But, perhaps, you can bake in some sustainable elements — maybe by using a portion of the cost to donate to a local cause or having the clients participate in a volunteer effort.
One first-time user of an advisor said after a trip, according to Upchurch: “You mean to tell me that my Virtuoso advisor can give me peace of mind, make sure I have a great experience with my family, take the hassle out of it, have my back when things go wrong, but then on top of that, layer in an element of making it easy for me to give my business to people that are doing things for the world? I didn’t even know that existed.”
Who doesn’t want that praise?
“There’s a leadership position in inspiring your clients,” he says. “It has to do with how to deliver a better value proposition, and that’s why I also believe that the role of the advisor is becoming more and more holistic.”
So, as consumers continue to evolve and travel advisors continue to professionalize, there’s a lot to get one excited about the industry. And while COVID-19 may have caused Upchurch to delay his introduction to the future of Virtuoso, it’s no doubt still at the top of mind.
“I’m in charge of continuously evolving a human-centric operating system that allows our network participants to be able to do things that are unique expressions of themselves, that connects to their uniqueness, their artistry, their craftsmanship, but also allows us to be able to compete in a global, scientific way,” he tells Luxury Travel Advisor. “How cool is that?”
Travel advisors, while experts on travel, aren’t health experts — what is their role in a pandemic such as this?
The role of a travel advisor is not as crisis expert, but as a calming voice of reason to serve as their clients’ number-one advocate. We’ve always said that the advisor-client relationship is rooted in trust and that becomes most apparent when things are at their worst. I think it’s safe to say we’re at that point. Travel advisors have spent years, even decades, building personal relationships. They have access to real-time information that they share with their clients, so that they can make fact-based decisions, and they are able to help navigate a rapidly evolving travel landscape where policies are changing on a daily basis. An advisor isn’t there to tell their clients to go or not go; their role is to help the client make the best possible choice for themselves.
I think we will find when we look back in history that travel advisors were the unsung heroes of this crisis. They worked tirelessly to quell fears and preserve business, and helped protect clients while negotiating with partners to keep bookings coming in. Faced with some of the most difficult times they’ve ever seen, they showed up for their clients and their industry.
Has any previous disaster — natural or manmade — had this large of an effect on travel?
The travel business has weathered many storms and it’s during times of turmoil that this industry bands together and rises to the occasion. This particular event is different and more widespread than anything we’ve previously seen. It has the fear of the unknown that came with 9/11 combined with the economic gut-punch of the global financial crisis. All we can do is support our members and partners, and wait it out together, because so much of this is out of our hands. We are confident that the virus will be contained and the vaccine will become available, and when that happens, we know people will want to travel again. And when they’re ready, we will be, too.
How can you sell travel during a crisis such as this?
It’s tough to sell travel when planes aren’t flying and ships can’t sail; when borders are closed, countries are on lockdown and people are quarantined. These are unprecedented times. What we are trying to do is stay positive and focused on what happens next — postponing rather than canceling, summer travel, holiday travel, 2021 and beyond.
What advice can you offer advisors?
Now is the time when your value to your clients becomes most apparent. You will come out the other side of this with better, stronger relationships because of the trust you’ve built. And trust leads to loyalty, something that has always eluded the online channels. Focus on helping clients here and now, then, when the time is right, refocus them on future travel. Business will come back, planes will fill, cruises will once again visit ports, safari camps will continue to sell out — make sure clients know that travel hasn’t stopped indefinitely; it’s only a pause. If you can get them dreaming about where to go next, you will help them escape the current news cycle for a bit until they can enjoy that next trip. Travel is the only thing that enriches their life on three different levels: The dreaming that happens when you plan, the actual experience of the trip and the lifelong memories it creates.
Headquarters: Fort Worth, TX (plus offices worldwide)
Chairman and CEO: Matthew D. Upchurch
SVP, Marketing: Terrie Hansen
SVP, Global Product Partnerships: Albert Herrera
SVP, Global Member Partnerships: David Kolner
Number of Agencies: More than 1,100 in over 50 countries
Aggregated Volume of Business: $30 billion