Tour operators

Guest Post: Tours and activities will play their part in travel’s recovery

Posted by Lee Hayhurst on
Guest Post: Tours and activities will play their part in travel’s recovery

John Maguire, chief executive of start-up B2B supplier TripAdmit, says the potentially lucrative tours and activities sector is starting to catch up with increasing digitisation in others areas of travel

If you can look beyond the COVID era and imagine how the world will be when travel is back on the agenda, then the chances are that you’ll be wondering where your travel business will fit, how it will compete and, more importantly, how it will make money.

Whether an airline, OTA, travel agent or hotelier, industry players will be looking at what will give them the edge, be it technology led processes, automation, data management or pricing. They will also be looking at what they can do to increase revenue.

As the world’s commercial airlines, hotels and agents face significant financial stress from the broad shutdown of travel, let’s look beyond the here and now.

The travel industry does have a big future. A recent report from the United Nations World Tourism Organisation revealed that there will be 1.8 billion tourists a year by 2030, and they will all be looking for cheap flights, hotel rooms and things to do when they get to their chosen destination.

One area that has often been overlooked, or at best an afterthought, by OTAs, agents and airlines, is tours and activities.

Pre COVID, projections of the scope of the global tours and activities market were inconclusive but estimated to be around $180 billion annually.

The sheer size of this industry makes it significant and, even though it may not reach its full potential for a while, this will be a substantial market as people start booking experiences again.

Activities and experiences will be the drivers behind hotel and airfare bookings and the traveller’s overall journey.

People won’t be going to India to fly on a specific airline, they’ll go to take a cruise down the Ganges or visit the Taj Mahal.

Experiences are going to fuel consumer demand as travel picks up, and tours and activities will be an important factor in how people look at destinations they feel comfortable travelling to.

Airlines and agents that include personalised suggestions, such as a unique tour and activities, will make customers remember the brand and consider repeating their purchase on the next trip.

A great strategy to improve customer engagement and brand loyalty, while generating more ancillary income.

There is one problem however, and that is the vast majority of tours are still sold offline, either at the destination or through traditional tour operators and travel agents.

Prior to COVID, a staggering 80% of this sector’s bookings were taking place offline with online booking limited to those that had the time, money and resources to allocate to set up digital sales solutions.

This is now changing, with platforms like TripAdmit providing booking software and white label solutions that allow travel firms and airlines to upload and manage their own contracted experiences.

This is also prompting standardisation in the tours and activities sector which currently operates under a plethora of different formats. There are signs of cohesion and standardisation and, while it’s a slow process, it is going in the right direction.

The COVID crisis has also prompted a rush among local suppliers to get online, having lost their usual walk-up business from overseas tourists.

As travellers look for the assurance of a more digitised contactless experience, this industry is at last starting to catch up with the rest of travel.

Much the same way that independent boutique hotels were operating before sites like Booking.com helped connect them online. It’s in the industry’s interest because you get more people looking at more products.

The long-term outlook for travel continues to be bright.  Global integration, coupled with economic growth and rising consumer income and leisure time, have driven demand for these services and this should continue as we recover from this pandemic.

As travellers start to buy back into tours, activities and experiences, travel businesses have the chance to capitalise on this opportunity and increase their share of this multi-billion dollar industry.

Travel businesses that set out to increase these ancillary revenues usually focus on the commercial functions—marketing, sales, pricing, and distribution.

However, for many, such as hotels and agents, frontline employees remain significantly involved in selling or delivering most ancillaries.

While companies like ours provide access to thousands of experiences in hundreds of countries around the world, they continue to be an important part of the equation.

Comments

This is a community-moderated forum.
All post are the individual views of the respective commenter and are not the expressed views of Travolution.
By posting your comments you agree to accept our Terms & Conditions.

Jacobs Media Group is honoured to be the recipient of the 2020 Queen's Award for Enterprise.

The highest official awards for UK businesses since being established by royal warrant in 1965. Read more.