I write this article in the hope that someday soon the reality of distribution in the tours and activities space will change, and change dramatically.
For years I've been advocating for increased distribution of things to do and for years I've been disappointed with the lack of uptake.
This past year, however, something changed; in-destination activities got a wake up in the form of the acquisition of Viator by travel brand giant, TripAdvisor.
As important as this transaction was however it doesn't really change the current day to day realities of distribution of tours and activities.
With all the hype around tours and activities now though, suppliers are beginning to ask about distribution without really understanding the distribution landscape.
To help dispel some of the myths around distribution and to help clarify the current reality, I will take this opportunity to answer some of the questions that I hear more and more frequently from tour and activity operators:
What distribution partners are you connected to?
This question assumes that there are actually distribution partners to connect to, which there are not.
Outside of Australia, which is the exclusive domain of the TXA (Tourism Exchange Australia), there are no digital distribution networks.
Even then, the TXA is predominantly a hospitality distribution network and does significantly less distribution of tour and activity product.
If you look at the major resellers in the market, for example Viator, Expedia, GetYourGuide, CityDiscovery, Orbitz, and even some of the newer entrants like Excursiopedia and BeMyGuest, you'll find that only one has any kind of API for availability and none, including Viator, have the ability to direct connect to supplier systems for the purposes of directly distributing inventory.
All of these resellers require that suppliers contract with them and either upload product data, pricing, and availability to an extranet, or send the information to the reseller to upload to the site manually.
Some SaaS supply side systems offer the ability to create marketplaces and resell inventory from connected suppliers.
Rezgo, for example, released the RezgoConnect platform, a distribution marketplace, at the very first PhoCusWright Innovation Summit back in 2008.
Since then many other systems have tried a similiar marketplace model with varying degrees of success.
The truth of the matter, however, is that without significant consumer brand recognition, adhoc do it yourself marketplaces drive little to no significant incremental revenue and simply cannot deliver the same exposure that the true B2C marketplaces can offer.
Therefore, the only truthful answer to this question is... None.
What agency networks are you connected with?
Before answering the connectivity portion of this question, I have to address the agency network part.
There are no travel agency networks that connect to the supply side of the tour and activity space.
There are speciality aggregators and DMCs that have created their own travel agent networks for booking tours and activities.
Viator, for example, has had an agency partner program in place for many years that allows travel agents to book tours and activities through the ARC Marketplace.
Expedia has a similar program that allows travel agents to book and earn commissions on the sale of activities with the added benefit of booking air, car, and hotels as well.
To my knowledge, other than Viator, there are no connected agency networks that directly pull live availability or products directly from supply side systems.
So again, the only truthful answer to this question is... None.
Can I sell my tours through the GDS?
There are three GDS companies of note; Sabre, Travelport, and Amadeus.
Pretty much every travel agent in the world uses either one or a combination of the three companies to search and book airfare and hotels.
Tour and activity products are not available through any of the GDSes and therefore cannot be booked through travel agent desktops. All three companies have added application frameworks that allow for third party software developers to create custom applications for agent desktops.
I am unaware of any that provide tours and activities apart from, for example, FlexTrip's integration with Travelport in 2012. If others do, they would most likely use the existing programs from the likes of Viator or Expedia.
The answer to this question, therefore, is... No.
Distribution is going to be a major revenue driver for me, what can you offer?
If one were a new hotel or airline, I would be inclined to agree that distribution might be a major revenue driver, but if tour and activity distribution is going to be considered a major driver of revenue for a tour operator, they better rethink their business plan.
The reality is that distribution through online intermediaries drives about 1.45% of total revenues for tour and activity providers, according to PhoCusWright.
As incremental revenues go, distribution is a nice to have but should not be considered a significant recurring income stream.
The answer again, unfortunately, is... Nothing.
So what you're saying is distribution doesn't exist in tours and activities?
Not exactly. There is distribution through the resellers and OTAs I mentioned earlier.
The difference is that the distribution is not automated or dynamic like it is with hotels. With the exception of TXA enabled providers in Australia, you can't just click a button and resell your tours through a new channel.
In order to distribute through Viator, Expedia, or the other meaningful channels, you have to apply, agree to the terms of their distribution agreement, sign a contract, send product info and pricing, and manage bookings via email.
If you're interested in how activity marketplaces and aggregators work, take a look at the infographic.
If I want to distribute my tours or activities, what do I do?
Currently, the greatest opportunity for success in distributing tours and activities is by partnering with the leading OTAs and online aggregators.
This means having to contract with each one separately and, most probably, tweaking the product offering in order to avoid duplicate content across multiple sites and to make the offerings more relevant to the particular partner.
It also means preparing the reservation flow to accept the vouchers that each of the partners will provide to customers as well as managing the reservation emails that will be sent with each new booking. If the provider is working with Viator, it also means making sure that they are able to connect to the Viator Supplier API in order to automate availability and bookings.
Here is a short list of the tour and activity distribution channels I recommend partnering with:
Smaller or newer marketplaces worth considering:
I still believe that there is an immense opportunity for distribution in the destination activities space.
When you consider that distribution through OTAs and online aggregators generates less than an average of 2% of total revenues for most operators, the opportunity to grow distribution revenues is great.
The way forward, in my opinion, is to encourage existing and new entrants in B2C to think beyond the extranet model and develop programmatic connectors in order to make hotel style channel management a reality.
Adding connectors however, is only relevant if operators take the step of using reservation platforms that are capable of connecting.
The upside is that there are now enough quality tour operator systems in the marketplace to make the API development investment worthwhile.
Once we move the segment beyond the manual extranet paradigm to a dynamic connected model, we'll begin to see the reality of tour and activity distribution change.
NB: Museum and money tours images via Shutterstock.