In the battle between Tripadvisor/Viator and GetYourGuide, the winner is — offline experiences, which have more than 90 percent market share. That spells big opportunities for both of these companies.
Tripadvisor and its Viator tours and activities brand compete against amply funded and privately held GetYourGuide as the largest players in this sector. So it was intriguing when the Tripadvisor’s CEO said at a recent investor conference that his experiences business “is larger and faster growing.”
Matt Goldberg’s comments came on the same day that Softbank-backed GetYourGuide, based in Berlin, announced a $194 million investment round, and reports pegged its private valuation at nearly $2 billion.
Goldberg characterized it as “a nice valuation marker” and one that he’d really “like to have.”
Tripadvisor, based on its stock price Friday, is worth a little more at $2.4 billion, but that includes all its other businesses, including hotel search, various advertising programs for travel and non-travel companies, dining reservations, and more.
So Tripadvisor has considered spinning off Viator, the star in its portfolio, into a separate public company to unlock some of that value, especially if it could get a GetYourGuide-like valuation.
How Do Tripadvisor and GetYourGuide Stack Up in Experiences?
But is Tripadvisor/Viator indeed larger than GetYourGuide and growing faster? It’s tough to say definitively because GetYourGuide is a private company and doesn’t publish its financials. But both Tripadvisor.com and its Viator brand sell tours and activities on their platforms, and the combo in experiences is indeed likely larger than GetYourGuide, said a source close to GetYourGuide.
But the source argued that the GetYourGuide brand is larger than the standalone Viator brand, and is growing faster.
“So when Goldberg is referring to ‘bigger,’ then it is only when you count all these together,” said the source, referring to the Tripadvisor and Viator points of sale for experiences, as well as Viator’s big distribution partnerships, such as with Booking.com. “Viator is no longer bigger than GetYourGuide.”
GetYourGuide itself wouldn’t publicly comment on Goldberg’s statements.
In its most recent press announcement, GetYourGuide stated it hosts more than 75,000 activities from over 16,000 operators, and that it has 700 employees in 17 offices in Germany, the U.S. and UK. Since Johannes Reck and Tao Tao co-founded the company in 2009, travelers from more than 150 countries have purchased over 80 million tours, activities and attractions on its platform, the company said.
Tripadvisor counts more than 300,000 bookable experiences in 250,000 destinations. The vast majority of these experiences come from its Viator brand, although many are also booked on Tripadvisor.com and in its app.
The edge in numbers of bookable tours and activities would appear to go to Tripadvisor over GetYourGuide, although the latter has at times focused on offering a curated set of experiences over comprehensiveness.
GetYourGuide’s Growth Increases Versus Viator’s
In the first quarter, which ended March 31, Viator, which Tripadvisor acquired in 2014, recorded $115 million in revenue, more than double the year-earlier period.
Viator has been the standout performer in the Tripadvisor portfolio coming out the pandemic, although it lost $30 million in the first quarter this year as it pursued growth over profits. Meanwhile, the size of GetYourGuide’s profits or losses haven’t been reported.
In 2022, Viator’s revenue was 208% higher than in pre-pandemic 2019, said spokesperson Laurel Greatrix.
GetYourGuide has stated publicly that in the first quarter of this year, the growth of its booking volumes was 4 times — or 300% higher than — that in the first quarter of 2019.
But the Tripadvisor-Viator combo in selling experiences is precisely where Tripadvisor has an edge over GetYourGuide.
Viator powers things to do on Tripadvisor.com, and in so doing Viator gets “an audience with potentially hundreds of millions of additional, qualified travelers,” said Greatrix of Viator. “We’ve only scratched the surface of this, and that’s what Tripadvisor’s updated strategic focus, in part, sets out to, and is, changing.”
Tripadvisor was the most-visited travel and tourism website in the United States in May 2023 with 180 million visits on desktop and mobile, according to Similarweb.
“In Q1 2023, we exposed 14 million more travelers to experiences content than we did in Q1 last year,” Greatrix said. “It’s a significant part of what drove Viator’s Q1 success, and one reason the Tripadvisor and Viator relationship is so strategically compelling for both brands.”
Online Travel Agency Model or Standalone Like GetYourGuide
Based on his conversations with leaders of companies that process tours and activities reservations, Peter Syme, a partner in Tourpreneur, which provides advice to tour operators, said he thinks Tripadvisor is likely leading in the U.S., and that Europe-based GetYourGuide is likely winning there.
“GetYourGuide obviously need a IPO window to open at some point whereas Viator has more options,” Syme said. “If I was placing my own money on them I would bet on Viator, but then again I am not a fan of standalone tours and activity OTA [online travel agency] business models. The cost of acquiring customers is high and the lifetime value of the customer is low, and repeat purchases is rare.”
The Offline Channel Is the Real Leader
While most agree that Tripadvisor-Viator and GetYourGuide are the two leading tours and activities platforms in the world, online travel agencies collectively have less than 10% share of a market that is still mostly offline. That takes in everything from the scuba diving shop in Costa Rica to the hiking tour in Nepal, where travelers enter a store and buy a ticket on the spot.
But Greatrix of Viator points to the tremendous opportunity: An Arival estimate put the global market size at $235 billion this year.
“But, really, it’s hard to claim that any OTA has a leadership position when we collectively make up a single-digit percentage of the category’s sales,” Greatrix said. “Dominance in experiences isn’t held by a tech company. It’s held by offline bookings, and the hundreds of billions of dollars that flow through everything but OTAs.”
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Photo credit: Tourists and locals checked out the popular Comuna 13 in Medellin, Colombia on February 9, 2023. Source: Dennis Schaal/Skift Dennis Schaal / Skift