I have never been super excited about the tours and activities category.
But what exactly made me uneasy wasn’t made clear until recently, when a friend with a tours and activities startup asked for an intro to our investors, and I didn’t feel comfortable recommending them.
NB: This is an analysis by David Litwak, founder and CEO at Mozio.
I took a look at everything they sold on their website, from Hop On, Hop Off bus tours, to scuba diving excursions, to airport transfers to walking tours and realized that they were trying to conquer not one vertical, but 20+ verticals at once.
I had just gotten back from a scuba diving trip to the Philippines, and during that trip I had to choose between several dive shop options.
Some of them had different requirements for my certification; some offered Nitro, others didn’t; some offered a course on-site so we could do a more complicated night dive that was offered.
Others offered accommodation on the premises of the dive shop, of which some rooms had air conditioning and some didn’t; others had more dive guides per person, or had more dives per dive trip included in the price, and went to better locations.
I came back thinking that. wow, someone really needed to create a website that sorted through all the different dive sites, dive shops and the options at each.
And then I saw that all the tours and activities sites sold scuba diving excursions as well.
The issue at hand
What we do at Mozio, airport transfers, is included as part of the over-arching tours and activities definition as well.
But airport transfers should be sold in a completely different fashion than scuba diving tours.
It’s a huge industry, and even within airport transfers/local ground transportation you have different industries!
Shared shuttles, different forms of private transportation (taxis vs. sedans, separate classifications in NYC for "livery", in London there are special "minicabs"), express buses, express trains, normal trains, ferries, water taxis, helicopters and even a couple sea planes.
We have had a hard enough time building out a comprehensive search engine for this one vertical/use-case.
But on a tours and activities site transfers are just another tab, and sold just like a hop-on, hop-off bus.
As tours and activities startups like to point out, people don’t go through all that bother to see the airport or ride on a plane, they do it for those experiences.
And OTAs and airlines barely make money off of the main reason people travel, the in-destination experience, so I’m in complete agreement that this is a huge growth area in travel.
However, those experiences are in 20+ separate verticals, and we should stop treating them like one. As startup founders we should be conquering them one vertical at a time, with custom solutions for each vertical.
I was reminded of an article that Andrew Parker of Spark Capital wrote a long time ago, where he outlined all the different startups that do something that US classified advertising service Craigslist does, but better.
I think the best way of tackling tours and activities is the same way: we need to start carving it up.
I don’t necessarily think each one of those verticals can rationalize a separate company, just like not every vertical on Craigslist can be turned into an Airbnb-sized business.
And just like Craigslist isn’t going anywhere, neither are Viator, GetYourGuide and other travel activity portals, but moving forward there are several huge verticals that deserve a more custom solution, and the startups that are able to effectively carve up the tours and activities vertical will be the ones who win.
NB: This is an analysis by David Litwak, founder and CEO at Mozio.
NB2:Scuba diving image vis Shutterstock.
NB3: Activities list screengrabbed from Viator.