Luxury Travel Ltd confirms its position in the travel industry by selling luxury experiences to high-end customers.
In 2008, Luxury Travel received a request from a group of 18 Omani Ministers and the CEO of the Oman National Petro Company who wanted to tour the Old Quarter by cyclo and place a wreath at the Ho Chi Minh Mausoleum. At that time, the election was taking place which meant no transportation was allowed into the Old Quarter. The catchphrase of Pham Ha, Founder of Luxury Travel is “make our customers’ desires become a reality”, so he used his contacts in the local police to get permission for this tour to take place. In another case, Pham Ha had just a couple of hours to change the schedule at very last moment for 2 members of the French Embassy who wanted to take a day trip to the World Heritage Site of Halong Bay.
Luxury Travel focuses on meeting the needs of their high-end customers, hence its name. Pham Manh Ha, 39 years old, Founder and CEO of Luxury Travel, said his company is one of the first luxury travel companies in Vietnam. According to Tripadvisor, the famous travel forum that travelers refer to before planning their trip, Luxury Travel has 33”excellent” and 3 “ good” reviews from March 2014 until now. Each review receives a prompt response from their Public Relations Manager or the member of staff for that particular customer. Ha believes the secret of success is “to pay particular attention to ensuring customers feel they are special and can have a worry-free experience”.
According to the International Exhibition of the Luxury Travel Market (ILTM), luxury travel is a segment that accounts for 3% of tourism in total, but brings in 20 % of the total income in the travel industry and has grown steadily over the years. High-end customers are always demanding; they require good value for money and good-quality service. For example, they want their room to be available as soon as they check in and the room should also be the best and the most private. Even more important is that “the experience can touch their emotions”, something the founder of Luxury Travel makes sure “none of the other travel companies can copy”. One such example is when the professor of history, Le Van Lan, was invited to make a presentation to a group of customers who were visiting the ancient architecture in Hanoi.
Pham Manh Ha started his business in 2004 with 1000 USD and he took the opportunity to market to customers through the internet, running a website named Vietvoyage.com selling luxury tour packages which were unique in design and targeting high spenders. This webpage was in 2 languages, English and French, and used online payment methods, which were at the very beginning in Vietnam. “Marketing online can cut intermediary costs, make prices more competitive, save money on marketing fees and PR” Ha said.
His first customers came from the internet and from recommendations by friends and his relationship with embassy staff and their families who knew Ha from when he was a tour guide. In addition, Ha approached luxury clubs, newspapers and sent greeting cards to the offices of foreign companies which had just opened in Vietnam to introduce his company.
At the beginning of the 21st century, there was strong development in tourism in Vietnam thanks to welcome investment. Ha’s company started at the right moment and it grew rapidly. Every year he was able to buy two 16-seat latest model Mercedes for his company’s transportation service. After one year he changed the company name to Luxury Travel. “You could not be a successful business with an unattractive name” he explained.
In 2007, most travel companies began to use e-commerce applications for their business. The number of travel companies in Vietnam grew rapidly which made the market much more competitive. According to theVietnam National Administration of Tourism, this sector increased by about 40% in 4 years. Currently Vietnam has 1400 travel companies (both inbound and outbound).
Luxury Travel could not depend on online marketing alone so they extended the business by using b2b. They decided to change their marketing strategy and attend a variety of international travel fairs to approach luxury travel agents or tour operators around the world. Pham Ha said this was a turning point and the company’s revenues have averaged 30% growth throughout the economic crisis.
Mr Phan Trong Thang, Sales Manager at Luxury Travel said “Luxury Travel is different to other companies, where each member of operations staff is in charge of one particular aspect of their service. In Luxury Travel each member of staff takes care of all the services of each customer from the very beginning until the end of the tour including booking hotels, flight tickets, meals and all communications with the customers. ”
Thang said each person takes care of our customers carefully, from beginning to end.” We congratulate staff when they receive compliments from customers, but also have a fines policy for any complaint”. Thang explained this method of management by Luxury Travel focuses the efforts of Luxury Travel staff who Pham Ha calls “Luxers”. Pham Ha said “The customer is an emperor only when Luxers treat them as emperors.” He believes only happy staff can make customers happy and be able to inspire clients.
The luxury segment has higher costs but the profit compared to other segments in the market is also higher. Luxury Travel’s customers pay around 350-500 USD per day, which is three times more compared to the average spend of an international tourist in Vietnam. According to Luxury Travel and the result of a EU tourism survey project announced in October 2014, the net profit in the luxury travel segment reached 20-25%, 2-4 times more than the affordable segment.
Last year, Luxury Travel linked up with Asia Premium Travel, a luxury travel company in Cambodia, to provide longer tour packages in the Indochina region. In the terms of this joint venture, Luxury Travel will take responsibility for providing all services and tours in Vietnam. In the meantime, the company also opened representative offices in California (USA), Berlin (Germany), Buenos Aires (Argentina), New Delhi (India)….Besides the main markets like English, German and French they are extending into other markets such as Brazil, Argentina, India and South Africa…
Jason Squires, Founder of PIC Travel Ltd, became the official representative office of Luxury Travel in the UK from early 2014, to where Vietnam Airlines has 4 direct flights per week to Gatwick-London. This cooperation is expected to boost the growth to 3 digits in the near future from the UK market bringing it to 48 % percent of customers for Luxury Travel.” The indicators are positive” was PIC Travel’s answer to Forbes Vietnam via email. Luxury Travel’s owner predicts creating this new partnership will help the company achieve sales of 5.2 million US dollars in 2014, an increase of 58% over last year.
Although the Vietnamese economy has stalled over the last few years, Vietnam tourism has had positive growth. Since 2009, the revenues from tourism, with more than half from international visitors, has kept growth at 2 digits. However, according to the latest survey from the Vietnam National Administration of Tourism in October 2014, the number of foreign visitors returning to Vietnam accounted for only 6%.
Pham Ha experienced childhood poverty in Hai Duong and started up his business after 7 years at Buffalo Tours, a travel company owned by Thien Minh, as a guide and in sales. He has 3 bachelor degrees in English, French, and Business Administration. “ He is hard working and laborious” said Mr Tran Trong Kien – Chairman of Thien Minh Group.
According to Mr Bui Duc Long, Director of Huong Hai Junk (Halong), Ha has a passion for travel. They met each other 5 years ago and Ha shared with Long his desire to cooperate with Huong Hai on a cruise business in Halong. As there are enough cruise boats in Halong to meet the market demand, they agreed to start up the business in Nha Trang. Their luxury cruise, with a total investment of 3 million USD, will have its official launch in the first quarter of 2015.”Ha impressed me by his enthusiasm, abundant energy and his excitement when he was talking about Vietnam. Anyone who is close to him could easily recognize that Ha always see opportunities” said Jason Squires of PIC Travel.
With his passion in travel, Pham Ha has visited over 50 countries. His goal is to visit 129 countries and territories. The business man, from a poverty-stricken background in Hai Duong, now has interests in golf, going to the bars in the Metropole Legend or Intercontinental Hanoi hotels and luxury cars and cruises, but he still prefers to ride by bicycle from his house, which is close to the West Lake, to go to work. “I like luxury in a simple way” he said.
In April 2014, this small company with 50 employees and a turnover of US$ 5 million was nominated as “Vietnam’s leading tour operator” for the most prestigious World Travel Awards 2014, hailed as the “Oscars” of the travel industry by the Wall Street Journal, together with 5 other big travel companies. The award makes Luxury Travel brand even better known in the market. Forbes Vietnam Magazine. Dec Issue
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