points systems to subscription-based travel, the full cross section of the
travel industry is driven to keep customers coming back, again, and again. This
is not new or surprising, but the increased focus is logical - an extrapolating
number of communication and distribution channels combined with Gen Z’s
significantly different approach to travel consumption has made customer
acquisition strategy more complex and customer loyalty more important than
The tours and activities
market was one of the hardest hit travel segments during the pandemic but will soon
be bigger than it was in 2019 and will be valued at $306 billion by 2024,
with an annual growth rate of 7%. Experiences, which we will define as one or
half day excursions, activities and attraction tickets are a large, diverse and
increasingly digitalized part of the travel industry – and this is where a
loyalty opportunity lies today.
deliver the most memorable parts of a vacation - the incredible artworks of a museum,
the thrill of a roller coaster, street food full of flavor, an inspiring story
of a local resident, the splendor of a cascading waterfall – the examples are
endless. Travel businesses looking to boost their brand image, awareness,
recall and loyalty should want to be associated with these memories, and experiences
OTAs provide a straightforward solution to make this possible.
“We know lots of
our customers like to get out and about while on holiday, so we’re really
pleased to be able to offer an extended range of attractions and tours to help them
make the most of their trip away,” says Roy Stratford, head of commercial
partnerships at EasyJet holidays on the roll out of its tours and activities
offering through partnering with an experiences OTA.
growth in online bookings
According to a
recent global survey, online is now the primary way to research - and more
importantly book -excursions, with 61% booked via website or app. Almost 50% of
travelers are researching experiences before booking other travel components,
and one in ten travelers wish to book experiences online with their flight,
accommodation or ground transportation – this number is higher amongst millennials
and Gen Z. Across all traveler demographics, 80% are researching experiences before
they arrive in a destination.
While the jury
may still be out on super apps, in the travel space the biggest brands are
making plays to provide customers with a single, seamless booking flow for all
travel components. Booking.com, Priceline and Expedia are among those selling
experiences with, or following the booking of, another travel component. The
interest in experiences extends to other areas of the travel industry as well.
Google Maps is changing how they offer experiences, while more recently
Uber made a relatively low-key announcement that experiences
are now available in North America via the Uber app. The trend of travel
brands adding experiences to their online offering is only set to rise as
consumers demand a more convenient and connected booking experience for all
parts of their vacation.
“We strive to
provide a seamless booking experience for our customers through our connected
trip strategy. By embedding activities into our platform, we’re able to further
engage with our customers throughout the booking funnel to help deliver against
all of their travel needs, all in one place,” says Brett Keller, CEO of Priceline
on the launch of Priceline Experiences.
Quick entry to a growing market
businesses such as hotels or airlines, experiences can be a good source of incremental
revenue and drive greater profits. They are available in all destinations –
many of them all year-round, as an in-demand offering for both international
and local customers.
However, the tours and activities market is greatly fragmented,
consisting of millions of small, independently-owned operators that don’t have
their own online booking systems to connect with. Experiences OTA’s offer a
platform for these products to be distributed online, while providing travel businesses
with a relatively quick route to market through API and
white label solutions that efficiently add experiences to a travel business’
existing online platforms. These digital solutions enable businesses to offer a
curated product portfolio of the most relevant and sought-after experiences per
destination, all of which meet strict quality, health and safety and
The more advanced
white label solutions offer a plethora of customization options, from branding and
language options to customer booking flow and an even more refined portfolio of
experiences, by destination or experience type. Established experiences OTAs
offer further options, such as customer service delivered through dedicated
call centers and marketing support, with the digital capabilities of the solution
and the content-friendly nature of experiences, providing a relevant
opportunity to stay in contact throughout the customer journey. With three out
of four experiences sold being booked in-destination, this ongoing
communication before and during a customer’s trip is vital for driving bookings
and enhances customer satisfaction by offering a higher level of flexibility.
of a customizable, digital distribution solution, curated product portfolio, customer
service and marketing support, is providing businesses with a comprehensive solution
to quickly enter the growing tours and activities market.
“Experiences are more important than ever. They make a trip special,
meaningful and above all, memorable. Booking.com offers an enviable breadth and
choice of quality experiences to travelers across the globe, all bookable in a
couple of clicks from the palm of their hand. We seamlessly connect millions of
travelers with memorable experiences, a range of transportation options and
incredible places to stay - from homes to hotels and much more. We're on a
mission to make it easier for people to experience the world around them,” says
Matthias Schmid, senior vice president for Booking.com’s Trips division, on its
Tours & activities
driving loyalty – the opportunity is now
According to a TUI Group customer survey, vacations that include excursions, activities and tickets have an 18%
higher net promoter score (NPS) against those that don’t – a very significant
difference and a statistic that shows the key role experiences can play in
driving customer loyalty. Combine this with a growing tours and activities market
with an ever-increasing volume of online bookings, and travel businesses have a
prime opportunity to grow incremental revenue and foster customer loyalty by
adding experiences to their offering.
Despite this, there are still a relatively small number of businesses
selling excursions, activities and attraction tickets online – so for
businesses looking to boost customer loyalty, tours and activities presents a
strong opportunity right now.
About the author...
Gopalkrishnan is chief business officer at TUI Musement