It won't be a wave, but some consumers are warming up to the idea of booking a weeklong tour package online. The Travel Corporation sees more online travel agencies on the horizon and feels that consumer demand will cause these companies to cozy up.
The Travel Corporation, one of the world’s largest private travel companies with more than 30 brands including tour operators, hotels, and river cruises, only has about 20 percent of its business booked online. But that percentage has grown in recent years, and the company feels it’s only a matter of time before online travel agencies like Expedia and Booking Holdings come knocking to partner.
The company had its best year in five years in 2017, said Dan Christian, chief digital officer of The Travel Corporation, who spoke at the inaugural Skift Tech Forum in Silicon Valley in June. The Travel Corporation does $2 billion in revenue per year and has more than one million travelers travel with its brands each year.
Christian said recent acquisitions by Booking Holdings and TripAdvisor in the tours and activities space will have an impact on many of his brands. “Steve Kaufer at TripAdvisor recently raised his guidance on the tour category from a $1 billion vertical to a $2 billion vertical,” he said. “And they only decided it was going to be a $1 billion vertical about six months ago.”
TourRadar, an online travel agency for multi-day activities, has pushed the company for more information about its products, said Christian. “We’ve created a special product council that includes them to prioritize what we should include in our APIs,” he said.
Christian said booking sites will “quickly correct” the mistake they made by missing out on multi-day tours in the past in the next year as more acquisitions and investments are made. “More people are transacting online and they’re very comfortable with the price point,” he said. “More customers are comfortable being able to book that complete experience online like adding air to a land-based tour. That is going to become very compelling for [online travel agencies] in the near future.
The Travel Corporation recently moved five of its largest brands onto the same content management system which helped various brands better cross-sell their products. “Staying private has helped the company innovate,” said Christian. “The company has generated $20 million in new business just by sending emails out to past passengers to look at other brands in the group.”
But major online travel agencies probably wouldn’t need to overhaul their existing platforms to integrate multi-day tours, said Christian. “It’s likely not replatforming for them, it’s likely just harnessing the power of the APIs that we and other companies like us can provide them,” he said. “And that’s been a big focus for us.”
The Travel Corporation is not a technology company, said Christian. We’re not confused about that and it’s not just about where you purchased travel, it’s about whether you’re going to come back and repeat,” he said. “That is our loyalty, we don’t have points or rewards. Customers are going to demand that certain brands be sold on [TripAdvisor and Booking’s platforms] and in that respect, they would be very limited in their scope. Especially at this earliest stage if [TripAdvisor and Booking] started to become more protectionist so I don’t see that happening in the short-term.”
You can watch the entire interview above, or consider reading more coverage of Skift Tech Forum.
At Skift Tech Forum in Silicon Valley, travel tech executives gathered for a day of inspiration, information, and conversation.
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Photo credit: Dan Christian, chief digital officer of The Travel Corporation, spoke at Skift Tech Forum in Silicon Valley in June. Skift