Unlike airlines and hotels, the tours and activities sector has been highly fragmented, largely offline, and extremely inefficient, mostly because its products are so diverse. Traditionally, travel advisors have had to access multiple booking sources that are not connected with their own internal systems.
According to Skift Research, 55 percent of tour and activity suppliers do not have a third-party reservation system, and, of those who don’t, 67 percent use things like email or calendars to manage bookings. Traditionally, travel advisors have had to access myriad systems and tour operators’ websites to confirm product availability, and then communicate via phone or email to confirm bookings. In addition, procurement teams have had to source product and negotiate rates with individual tour operators.
This time-consuming model isn’t realistic for today’s travelers either, with most people booking tours and activities in-destination from their smartphones, and especially with Covid-19 making travel more unpredictable.
“An airline seat is an airline seat, and a hotel room is a hotel room, but an activity can be a cooking class, a parachute jump, or an infinite number of other things,” said Mark Rizzuto, CEO of Livn, a Sydney-based technology company that aims to optimize the tours and activities sector with an API that delivers real-time, immediate availability for tours and activities around the world through a structured content feed.
Livn and Flight Centre
Under a new partnership with Flight Centre Travel Group, Livn’s technology platform promises to streamline the company’s booking process for tours and activities. “When we did a case study of the Flight Centre business model, each of their stores had a physical book in the stores that had logins to hundreds of portals, not just tours and activities but travel content portals,” Rizzuto said. “Agents had to look everything up, and it was all sitting alone on a portal, not integrated with the traveler’s profile or invoices.”
For Livn, the challenge has always been about how to automate and integrate into tour operator reservation systems in a seamless way. Their solution is a single API that delivers structured inventories for live tours and activities into existing workflows used by travel advisors, online travel agencies (OTAs), or any travel reseller sales platform.
“Live inventory has always been important,” Rizzuto said. “Post-Covid, it’s going to be critical. I don’t think we’ll see such long booking windows for travel products, because we just don’t know whether or where we’re going to be able to go. Many people who booked their 2020 vacations several months before Covid hit lost money due to poor refund experiences. The pandemic has made long-term planning very tricky.”
Recent research from Phocuswright showed that 53 percent of bookings in the tours and activities sector occur 72 hours before consumption, which points toward in-destination decisions being made by travelers based on how they feel at any given moment. That’s why Rizzuto made the decision to only include live tours and activities, and not static bookings, which can disappear because of a lack of accessibility to availability within the last 48 hours.
“We do this by connecting to the tour operator’s reservation system,” Rizzuto said, “which we consider to be the ultimate source of truth. That’s our tech logic and our business mantra. Everything else distorts the truth by creating middlemen and potential points of failure.”
By linking directly into several SaaS-style tour operator software systems, Livn gets a real-time handshake with the thousands of global tour operators who use those systems. “Our API sits over the top of those connections, harmonizes the content, and then distributes it back out to multiple reseller channels via a single API,” Rizzuto said, “so for Flight Centre, we’re the tech facilitator. We’re not the middlemen dividing commissions.”
The backend of Flight Centre’s platform already includes separate APIs for airline reservations and hotel products. Now, with Livn’s API for tours and activities, Flight Centre’s travel advisors can access products from their tour partners in destinations around the world in a uniform way, regardless of product or booking location. That way they can provide customers with a beautifully synced itinerary and an invoice that breaks down the airfare, the hotel rate, and the cost of their chosen experiences.
Rizzuto said the partnership isn’t just about providing easy access to tour products for travel advisors and creating a holistic booking experience for customers. “With a very large number of global tour operators, you need a very big team of people who are constantly tracking new products, new partners, and fluctuations in pricing,” he explained, “so this handshake also benefits Flight Centre’s invisible army of people that procure and manage product for the back end.”
Furthermore, the partnership doesn’t require Flight Centre to change its existing commercial agreements with suppliers. “We’re like the telephone company, quite frankly, holding the call between party A and party B, and we’re making sure we’ve got the right people talking, but we don’t impact their commercial agreements, we only charge a small transaction fee to enable the call to happen.”
Looking Toward Travel Recovery
The Covid-19 pandemic has accelerated the development and adoption of contactless technologies, removing physical touchpoints in models that were overly labor intensive. Tour operators are reimagining the customer journey and building contactless technology into their products and services, particularly around ticketing (electronic tickets with QR codes on mobile devices have become commonplace, for example).
“Tour operators are preparing,” Rizzuto said. “They want to be ready when recovery happens, whatever that looks like, even with travel windows opening and closing over the next year. The ability to electronically play the dial with what’s available, and at what velocity, is going to be critical. Again, everybody believes booking windows are going to shorten, and so the ability to offer last-minute experiences is critical.”
Many well-established travel brands are plagued by their reliance on legacy systems. While Covid-19 has accelerated their willingness to come on board with new technology solutions, it may be harder for them to move as quickly as needed from an operational perspective. The question right now is whether some of these big players can secure the capital they need to invest in technology.
Rizzuto sees Livn as an answer to this problem. “We can plug into any system, even those legacy systems used by traditional travel companies, because we’re an API and not an end product for consumers. Our value proposition is all about efficiency.”
Check out Skift x Livn’s Tours & Activities 2020: A Year in Review content hub for related content.