First Light Travel co-founder, Brent Narbey, on establishing an OTA in New Zealand in the early 2000s, future-proofing a travel business and fostering talent within the industry.
I met my business partner Nigel Williamson while working in travel in London when we were both in the African overland industry. I had founded Global Connect Travel to sell safaris into Africa, and Nigel was managing Bukima Africa – the largest African overland company in those days.
When we both ended up moving back to New Zealand we decided to team up to launch a travel business. What we didn’t want to do was deal with Kiwis who are relatively savvy when it comes to travel and send them on an adventure holidays. There were plenty of people already doing that, and it required lots of infrastructure – we didn’t want to be a high street travel agent.
We had also set up a dive training agency here – based on one we had in London – so from the space above the dive shop in Westhaven we started our online travel agency, First Light Travel in 2001, to focus on dive trips for the inbound market.
There were only two other online travel agents in New Zealand at the time and neither of them exist anymore. It was easy to get traction in the market with so few competitors and in those days, before Google Adwords, we came up on the first page of a Google search without even having to try.
We quickly established that America would be our main market and in the early days we went to dive shows and adventure travel shows to promote the business. First Light Travel soon expanded from dive trips to specialise in self-drive and small group trips with adventure themes – we are heavy on experiences such as hiking, caving and of course diving.
There are now 21 of us working here, including 15 people in sales, and the US remains our main market supplying around 80% of our clients.
We had learnt lessons from our previous experience in the travel industry so we figured out early on that we needed to have our own in-house back-end systems built. Nigel is a chartered accountant so he worked with the developer on the banking and accounting side of the software while I had input into the sales side. That has done us really well and 15 years on we are still using the same platform which we have control over.
It doesn’t sound ground-breaking now, but another thing we did was set up remote working applications so that when we needed to expand we could take on remote staff, which also kept our overheads low when we were building up the business.
Since launching First Light, the market has been through lots of ups and downs – the Iraq wars, SARs, earthquakes – we have pretty much seen it all. The one thing I have learned is don’t panic, people still travel, you just need to know where to access them – targeted marketing is the key to this.
As a business we have a long-term belief that New Zealand is on the right trajectory although, yes, there will be a few things to upset the market at times. To protect against this we have a measured growth approach for the business – we not just going to go and expand really quickly on a whim.
Another thing we have done is start selling Australia. We launched our Aussie website in 2008 but we have dialed back the adwords marketing there at the moment because NZ is doing well. However if things ever start to show strain here we could get back into Australia, and perhaps the rest of the South Pacific Islands as well. They are all great destinations to sell to the American market.
Being an OTA is a good business to be in – I wouldn’t have been doing it for 17 years if it wasn’t. Because we are selling direct we are not giving away up to 17% commission that other businesses lose through the traditional distribution chain. We still have a lot of different commission structures so profit varies with each booking, but I would say for an overall package I would be disappointed if the business was taking less than 25% from a file.
Even though the OTA market is much more competitive now, we are in a very fortunate position of being able to deliver all-inclusive trips for our clients because of some of the historic contracts that we have. The type of client we are targeting doesn’t have time to think about their trip they just want it sorted. We can fly them from North America, fully insured with some really good competitive travel insurance, look after every aspect of their journey and give them the trip of a lifetime. That’s our competitive advantage against the giant OTAs in the market – it all boils down to the type of buyer we are targeting, and those are the clients that appreciate our service.
It also means a lot of our business is referrals and also repeat business. People come to NZ two or three times from the US – they love it. Our strategy is to really look after them – customer service is something we are big on. This is also something we really try to impress on new suppliers that want a contract with us. We get approached maybe once or twice a month by potential suppliers, which is great as we are always looking for new product. If they’ve got half a good idea and got some experience behind them we invite them in for a meeting and get them to pitch. I really like to talk to newbies in the industry and give a helping hand if possible – we want to reciprocate the experience we encountered when we started.
The most important thing is that they are going to give the visitor a good experience. The success of the New Zealand tourism industry falls back to the operators and the experience they give – we are in a competitive market with other destinations and New Zealand has to deliver.