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In September, Iberostar invested an additional $12 million in Almundo, following on $28 million the group invested in the company during the first quarter.
Almundo is ranked second behind Despegar in the share of retail dollar sales of online travel in Argentina, according to market research provider Euromonitor International.
In May 2018, Almundo launched online travel sales in Brazil.
Since 2016, the company has had an internet and call center presence in Mexico and Colombia as well.
Quiet Growth Story
In 2017, Almundo processed nearly $500 million in gross bookings across all its operations. That was up from about $350 million in 2016.
But Almundo will finish 2018 with annual gross bookings processed offline and online of close to $500 million again.
The company blames the apparent low growth in U.S. dollar-denominated gross bookings on the Argentine currency, which lost about half of its value against the U.S. dollar this year. Many Argentines switched their travel plans from foreign to domestic destinations, affecting average transaction values for agencies in Argentina. The currency effect also understated Almundo’s growth.
Today Almundo runs 67 retail agency outlets in Argentina, which it said is the most bricks-and-mortar outlets of any company in the country.
Almundo aims to grow that number to 200 branch offices by the end of 2019. It believes its technology, inventory, and marketing will draw many independent agencies to become franchisees.
In an interview, Lafosse’s favorite word was omnichannel, a blend of offline and offline sales.
The travel industry often uses the term multi-channel to refer to a business that serves customers across online sites, call centers, mobile apps, resellers, and retail shops. For Lafosse, omnichannel means letting customers use whichever of those channels might work best at any given point before or during a trip.
In the past year, Almundo has been expanding its online Experts platform, which is a collection of freelance consultants and tour operators who provide booking and in-destination services to consumers as a supplement to what Almundo’s agents offer.
Lafosse compares it to how Amazon offers e-commerce sales alongside a marketplace where other sellers can participate.
“The omnichannel model is our industry differentiator,” Lafosse said. “Before planning a trip, Latin American travelers may check for deals on different devices, visit our branches, or interact with one of the freelancers in our Expertos marketplace. It’s critical to us to continue implementing new technologies that help us create a seamless experience for our customers.”
Lafosse has pushed to make it easier for consumers to communicate with Almundo agents via chatbots and to initiate transactions via messaging services like WhatsApp.
He said that today about half of the company’s revenue is generated online while the rest comes through a mix of assisted channels, such as retail shops, call centers, and its network of freelance travel concierges.
This year the company spent $2 million on creating a development hub in Bogota and Medellin. The hub will let it bring more of its software development in-house, and it plans to hire up to 50 engineers there.
The company has experimented with virtual reality content, though today that content mostly appears to be a marketing gimmick.
Vravel creates video content and Almundo has made it available via its mobile app. Consumers can view the content with smartphones equipped to display virtual reality. Almundo has also offered virtual reality headsets for customers at some of its retail shops to see the videos. Vravel’s clients include Iberostar, Argentina’s tourism office, and travel tech company Sabre.
Brazil is not for amateurs, as a local saying goes. Almundo faces a formidable challenge there, given the established players.
Other online travel players in Brazil include ViajaNet, HotelUrbano (bought by Booking Holdings for $60 million, and later written down as an investment), and Decolar (Despegar’s local brand).
In Argentina, Despegar remains a formidable competitor. Lafosse said he believes that Almundo can compete by aiming to have a better product offering. He claimed the company already has a larger hotel inventory in the region than Despegar thanks to directly negotiated supply deals. He claimed Almundo has a more comprehensive set of European low-cost carriers for sale.
In Mexico and Colombia, Almundo is working to improve its marketing and operational efficiency. Lafosse said he wants the company to enhance its cross-selling of products, convert more shoppers into buyers regardless of preferred payment method, and to keep pace with its peers at fraud analysis and prevention.
Lafosse plans for Almundo, which has more than 850 employees today, to expand outside of Latin America by 2020.
Retooling an Old School Model
A bit of backstory: In 2012, Iberostar began investing in the travel agency, which at the time was called Asatej. In 1992, Juan Pablo Lafosse co-founded the agency with Eduardo Biraben and Pablo Fisch as a self-funding business.
In 2014, Lafosse returned as CEO of Almundo. He has since been implementing Iberostar’s digital-first vision.
But Almundo lacks the capital of rivals like Despegar, backed with a 14 percent investment from Expedia Group, and CVC in Brazil. So the company’s omnichannel ambitions will face multi-directional headwinds.