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Today we are launching the latest report in our Skift Research Reports service, The State of Tours and Activities Tech 2017.
This report offers an update on the latest developments impacting both the consumer-facing and back-end platforms for the tours and activities segment. As it stands, the supplier base is heavily fragmented worldwide, with the industry dominated by many small, locally-owned operators who have traditionally relied on in-person, often last-minute bookings to drive their businesses.
Bringing tours and activities online is a central monetization challenge for the big aggregators, particularly in a travel product category with naturally lower online penetration rates, as well as lower average booking values compared to hotels and flights. While there’s great optimism across the board about the potential growth of the tours and activities tech sector, things haven’t been so peachy for all the players involved.
One of the most talked-about events in the travel industry at the end of 2016 was Airbnb’s announcement of Trips, a new service that taps into the potential of enthusiastic locals, operating as a hybrid of the curated and peer-to-peer models. Trips currently focuses on three domains (Experiences, Places, and Homes), with plans to eventually add two more areas (Services and Flights). Although many smaller, specialist platforms out there have made it possible for passionate locals who aren’t tour guides to create their own tours and activities, Airbnb may be able to effectively Uberize the tours and activities space in a way that others haven’t, through the sheer force of their brand dominance.
Traditionally, peer-to-peer platforms have had to compete with established players; ride-sharing services such as Uber and Lyft compete against taxi companies, which in many cases have the support of unions and local governments behind them. Home-sharing platforms, including Airbnb and HomeAway, have faced consistent hurdles both in competing against traditional hospitality players and in navigating municipal government tenancy regulations.
Currently, there are two major models that dominate in the tours and activities booking industry: curated models where tours are vetted or curated, and marketplace-style open-listing models where anyone can offer a tour or activity without first having to go through an application process.
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