What you need to know:

• Leigh Barnes, Americas President and Chief Customer Officer at global Australian travel firm Intrepid, has been tasked with growing its US business.
• Tough gig, for a purpose-driven, DEI defending, climate-positive B Corp in the corporate age of Maga.
• Barnes is walking the tightrope, getting “bashed” and working out when to take the backlash, when to hold back.
• But he’s also spearheading a contrarian brand-first approach in a performance-heavy marketing environment. “I keep getting told that we’re crazy for doing so much brand work in the USA.” Per Barnes.
• The cost of US media is “crazy” – 25-60 per cent more expensive than Australia, he says. “Lower funnel marketing, the pressure on key certain keywords is huge – so huge bidding – and then there’s just more brands wanting the same amount of spots,” he says. 
• Thing is, it’s working – all that brand investment has seen organic search almost double in couple of months. Which is a massive advantage in the expensive, highly competitive biddable US media environment.
• So much so that Barnes needs to rewire its distribution to avoid over-reliance on Google.
• Next up, he’s on stage in front of a who’s who of top US and global CMOs – telling them why they might be slightly off on their brand to performance investment ratios.
• Cue more slaps.

Sanity check

Melburnian Leigh Barnes is Americas President and Chief Customer Officer at global Australian travel firm Intrepid. Before that he was Chief Purpose Officer, and before that, its performance marketing boss. Now he’s getting “slapped over the head” for going large on brand in the US and short on performance marketing – all while talking about purpose in the corporate age of Maga.

Thing is, it’s working – and next month Barnes is likely to take a few more slaps when he gets on stage at the CMO Alliance Summit in Palo Alto and tells a who’s who of senior US and global marketers that going too long on the short-term tactical stuff might be the root of their troubles.

“I keep getting told that we’re crazy for doing so much brand work in the USA,” he says. But Barnes is buying “a cocktail of above the line – billboards, public transport, podcasts, newspaper, partnerships, social influencer type stuff. Anything that’s not paying for that bottom of funnel conversion optimisation, we probably do that,” dovetailed with a stream of PR and media storytelling.

The upshot is all that brand work is feeding conversion. “In January, [organic] searches for our brand were up 90 per cent,” says Barnes.

So who’s crazy now?

Good different?

Barnes has been “toggling” between the US and Australia for the last few months. He’s been back down under the last week, in preparation for moving his young family out today to Seattle.

How’s the home of grunge?

“In winter it’s cold and bleak. Kurt Cobain, Eddie Vedder, all that stuff. But it has beautiful summers, the great outdoors. It’s pretty booming too, all the tech companies that are based out of there,” said Barnes. “Seattle is definitely booming.”

Intrepid is also definitely booming. Founded by university mates Darrell Wade and Geoff ‘Manch’ Manchester in 1989 after a trip around Africa, it’s on track to hit close to $800m in revenue this year per Barnes, with circa $200m of that coming from the North American market, $300m out of the UK and Europe and the rest, around $300m, via Australian bookings.

Two years ago Barnes told Mi3 Intrepid aimed to be a billion dollar business by 2025. A bold call – but he says it’s just a matter of time.

“We’ll get there in the next couple of years, that will happen pretty quickly now, “ per Barnes. “The joy of compound growth.”

The US expansion should help get Intrepid’s unicorn bid over the line.

“We expect the USA to be our fastest growing market. Traditionally, it’s grown anywhere from 20 to 40 per cent over the last 10 years. The year out of Covid it sprung really aggressively at about 70 per cent growth, the year after, it was closer to 20. So I’m looking at getting somewhere around that 20 to 30 per cent growth over the next 18 months,” Barnes told Mi3.

“The big kicker for us is largely the US business has come direct. In Australia, it’s 50 per cent direct, 50 per cent travel agent. Out of USA, it’s 80 per cent direct.”

Which means better margin, and a tighter connection with the customer. “So that just means how we go to market, we have to do a few things a little bit differently.”

Damascene conversion

The US market is a law unto itself.

Firstly, “the cost of media is crazy,” says Barnes. “The cost is anywhere from 25 to 60 per cent more expensive than in Australia and even more expensive than London – and that’s everything from top brand stuff to the bottom of the funnel, like cost per click, is just much more.”

Why is that?

“I’m still trying to get my head around it,” says Barnes. “Lower funnel marketing, the pressure on key certain keywords is huge – so huge bidding – and then there’s just more brands wanting the same amount of spots.”

He says that applies to both the walled garden platforms and the broader media market – but agrees the US market is far more performance-focused than other geographies.

Barnes once ran performance marketing for Intrepid and was all-in on lower funnel spending. But he had a Damascene conversion to brand during Covid, previously describing it as a “punch in the face moment” which had him devouring virtual Professor Mark Ritson’s gospel along with System 1’s Jon Evans and advertising effectiveness luminaries Peter Field and Les Binet. 

That epiphany led him to launch Intrepid’s first ever brand campaign – and the business literally took off.

“Straight away we saw an increase in people coming to the homepage from the cities that we were doing the majority of the spending in,” he said at the time. “So almost immediately in London we had a 30-40 per cent increase in branded search terms and people coming to the home page, which we would never have seen before. We also saw this effect happen much more in Australia where we had an improvement in conversion. Because people trusted us more or knew about us, we saw conversions jump. There was that halo from the brand work.”

Search surge

Despite getting stick, Barnes is sticking with long over short in the US – and the rapid results suggest he’s right to hold the line. But alongside brand investment, Barnes also thinks AI chatbots are factoring into organic search success.

“More customers are going through ChatGTP or copilot to whittle down their search preferences, especially in travel. So they go to ChatGPT, ask questions, filter it down and then go to search,” says Barnes.

“So either two things are happening: generally more people are knowing us; or we’ve done a good enough job [on content, reviews etc.,] so that when people are asking AIs the questions, that we pop out.”

Either way, search is powering. “Which is the opposite [effect from AI] to what I’m hearing from a lot of people. They’re seeing reductions in the travel space on the amount of search for their brand.”

Physical transformation

While direct margins are better, Barnes isn’t comfortable with the US split, so Intrepid’s working to build the retail partnerships that fuelled its growth in Australia.

“I’m hoping now to be able to grow that part of the business, because I don’t want to be hamstrung by distribution just through Google or online. So we need to do a better job in working with partners and building those networks.

“There’ll be a review of our distribution, because at the moment, it’s great from a P&L point of view, but from a risk point of view, too reliant.”

Plus, if Intrepid is spending big to create mental availability, it needs the flip side of the Byron Sharp-Ehrenberg Bass coin. “That whole physical availability thing,” says Barnes.

“If we do this brand work, and someone works into a travel agent: ‘Can I book Peru with Intrepid’, and the agent says ‘Great, but we don’t sell Intrepid, but there’s this other brand that you know that does the same trip or similar products. Do you guys want to book on that?’ So we’re reviewing the distribution and trying to get a better grip around physical availability – where are Americans buying and is Intrepid showing up there? Because we’ve done a lot of work now to be more well-known. I’m just probably going to spend a fair bit of my energy on how customers are going to find us and purchase us.”

Partner turbulence

Barnes says Flight Centre was a major factor in driving Intrepid’s initial success in Australia. But the brand struggled to regain altitude after Covid.

“They had to massively transform their business, they were pretty badly hit,” he says.

“Their marketing was their storefronts for such a long time … So it’ll be interesting to see how they right size now, because they probably do need to get that physical availability piece sorted again, because they shrunk the amount of stores massively, and we felt that like they’re not the same partner they were,” says Barnes.

“Pre-pandemic, if you went on an Intrepid trip, probably somewhere between two and three of the five customers globally would have been through Flight Centre. Now that’s probably one.”

Flight Centre global CMO Megan Henderson nods to the massive overhaul it has undertaken – and a push into in-store screens and content amid a plan to leverage those stores for an owned media operation – in an Mi3 partnerl podcast with Sonder published later this week. (She was tasked with centralising five global teams into one while overhauling Flight Centre’s martech stack and contracts and simultaneously finding efficiencies and growth.)

Meanwhile, the firm’s latest financials suggest it is back to pre-Covid revenues – with a far smaller cost base. In other words, Flight Centre appears well into recovery. Barnes says that is a very welcome development.

“They’ve completely reshaped their business. They’re a behemoth and the bellwether for our sector. If they’re up and about, we’re normally up and about, because they bring so many customers through. I think it just took a bit longer for them to realise their [post-pandemic] strategy. So hopefully they’re in good stead now, because that will be beneficial for us.”

US customer difference

Across geographies, Barnes says top destinations tend to be similar.

“Most our top five, regardless of market, is Peru, Vietnam, Morocco, Southern Europe. That’s largely the same everywhere, with some nuances within that.”

The key difference in the US is that “Americans normally just go a bit higher on the standards”, says Barnes.

“So they will normally spend more, they’ll normally select our higher end products, and they’ll travel a little bit shorter. So from a destination point of view, it’s relatively near the top five – and after that, it gets a little bit crazy and different. But the big skew from an American point of view is spending more and wanting a high standard,” he says.

“So the branding position is exactly the same. It’s all about having Intrepid experiences, ensuring you’re doing that with minimal impact, and connecting with local cultures and communities. That all stays the same. It’s more just the functional component – they like a nicer hotel, they want to be able to get a better transfer. But the actual experience of sustainability, experience of community, those things stay true.”

Purpose pressured

Growing a company that puts DEI and sustainability at the heart of its B Corp-certified business as corporate America turns Maga is no mean feat.

Barnes was Intrepid’s chief purpose officer before becoming customer chief.

“It’s an incredibly divided country at the moment. It feels like everything is the hot button. Being a values-led company means we’ve got good opportunities, but also the negative that comes to that as well. So I’ve been speaking a lot publicly around DEI and climate commitments, and then also getting bashed over the head at the same time.”

Does that mean the firm has to change its approach and tone in the US?

“It’s sort of keep going, because that is the brand, that is the company. It’s probably more working out when I should and shouldn’t be talking,” says Barnes.

“Probably the thing that’s most stressing for us at the moment is some of the changes around the national parks – the reductions in staff and the fact that they’re going to start drilling in the Grand Canyon. For us, that’s problematic, and that’s probably an area that I can speak to and be okay with backlash, because without national parks, it’s really hard to have a travel business in the USA.

“So it’s probably just getting a better understanding of where we should lean into the values and speak to them a bit more – as opposed to putting our head above the parapet on every single topic.”

It’s a fine line to walk – but Barnes is comfortable that a balance can be struck.

“We’re still a niche [player] in the USA. So if we speak to our core customers, and they’re interested in this stuff, we’re more likely to keep growing, which is what we’ve seen. So that’s something that’s quite big.”

But he says the company hasn’t yet landed a formal plan.

“It’s something I’m actively reviewing. We’re still going to keep our same brand values and keep pushing, but how we do that is probably more nuanced.

“We believe in inclusive travel. We believe that climate change is a threat and that we need to be traveling better. So those things will be true. It’s probably just more how we go to market – is it with a sledge hammer? Is it with a feather? How do you actually talk about that? That’s probably the thing that needs to be worked through.”

Ultimately, he says Intrepid’s marketing is usually product led – and the product is the experience, which has those values baked-in.

“We want people to have amazing experiences. All the other things that we do are built into the functional aspects of the trip: The trip should be low impact, it gives back to communities, we travel in this way because we want to give back and engage with diverse communities and support First Nations. That’s what’s going to happen on the trip, so the product is doing a lot of these things.

“So there’s nuance around what do you talk about and communicate. But we’ll continue to stay true to those. It’s probably just more around when and how we show up.”

While firms doing business in the US are working out how to tread, Barnes says most of the vitriol is just noise – and most likely, manufactured.

“It’s trolls on Twitter … every now and then a Russian bot farm will fire up because I said ‘climate change’ in a tweet”.

He shrugs it off and the company braces for the occasional bash over the head.

After all, intrepid literally means showing no fear in the face of danger.