On the back of another quarter of growth, with its consumer brand Almosafer recording the best quarter in its history for travel bookings, Riyadh, Saudi Arabia-based Seera Group is looking to expand aggressively into the tours and activities sector through its joint venture with Klook.
Muzzammil Ahussain, executive vice president, told WiT that the 50/50 joint venture, signed between its consumer brand Almosafer and Klook more than a year ago, is expected to go live with its marketplace with a soft launch this fourth quarter.
“We are very excited about this, this is the first time we are doing such a joint venture, we feel both our cultures gel well. We are taking the best of Klook technology and adapting it with local nuances such as Arabic language for the Saudi market.
“The tours and activities sector is very fragmented and immature; there is no possibility for tours and activities to go into e-commerce. We will provide the local know-how and product knowledge and blend that with Klook tech to create a tours and activities marketplace for Saudi Arabia.
“We will go out to all tours and activities providers – there are over 3,000 of them – to create this marketplace so it’s not just selling our own products but everyone else’s. We will then sell these activities through Klook, our own brands as well as third parties.”
He says the plan is also to expand into ticketing for events and entertainment and “become the centralized supply of tourism activities across Saudi Arabia”.
Meanwhile, he says, the group was seeing a rebound across all sectors – domestic, inbound and outbound, as proven by its Q2 2022 results. Seera’s gross booking value (GBV) rose to SAR 2.5 billion (US$923 million) in Q2 (April to June) 2022, an increase of 108% compared to SAR 1.2 billion in Q2 2021.
During the first six months of 2022, Seera achieved a GBV of SAR 4.1 billion (US$1.1 billion), an increase of 105% compared to SAR 2 billion in the same period of 2021.
Almosafer, its travel business, reported a 89% growth in GBV to SAR 1.7 billion in Q2 2022, up from SAR 0.9 billion in Q2 202. Almosafer’s consumer travel unit achieved its highest-ever quarterly GBV of SAR 1.1 billion in Q2 2022, an increase of 175% compared to SAR 0.4 billion in Q2 2021.
In June 2022, Almosafer recorded the highest levels of consumer travel bookings in its history, exceeding pre-pandemic levels in June 2019 by 27% with a GBV of over SAR 500 million. Almosafer’s consumer travel segment is on track to achieve SAR 4 billion GBV by the end of 2022.
“We saw a strong summer season – the best consumer months exceeding pre-pandemic levels,” says Muzzammil.
Bookings for London and Paris have exceeded pre-pandemic levels in 2019, driven by the introduction of the electronic visa waiver for Saudi nationals on June 1, 2022, in the United Kindom and the lifting of pandemic restrictions in France. Thailand and Türkiye were also among the popular destinations, driven by the announcements that Saudi nationals are exempt from visa requirements to visit Thailand and are now permitted to visit Türkiye.
Muzzammil is confident this strong demand will prevail post-summer. “Everyone was worried that it would be a strong summer and then people would slow down. But we are seeing strong travel demand for the rest of the year.”
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U.K.-based Portman Travel Group, part of Seera’s Corporate Ventures, also performed well, thanks to a rebound in both corporate and leisure travel in Europe. The Corporate Ventures unit recorded a GBV of SAR 547 million in Q2 2022, an increase of 402% compared to Q2 2021.
The group also comprises Almosafer Business which reported a 27% growth in GBV, from SAR 473 million in Q2 2021 to SAR 600 million in Q2 2022; Lumi, its car rental and leasing brand, which saw revenue grow by 40% from SAR 122 million in Q2 2021 to SAR 171 million in Q2 2022; Mawasim, its wholesale tour operator for Hajj and Umrah, which recorded SAR 10 million in revenue for Q2 2022; Discover Saudi, its integrated destination management company, which recorded a GBV of SAR 24 million in Q2 2022, an increase of 50% compared to the same period in 2021. Its Hospitality unit yielded revenues of SAR 27 million, a 93% growth in Q2 2022 compared to the same quarter in 2021.
The group has set as a key milestone a return to profitability by year-end.
On what’s changed about Saudi traveler behavior, he says the booking window is shorter – from 20 days pre-pandemic to 14 to 15 days. What’s changed too are people going on multiple trips. “We are taking more than one summer trip and there’s an increase in solo travel, both men and women.”
Its largest booking channel remains mobile but its strongest growth channel is WhatsApp. Its team receives 10,000 to 15,000 chats a day for service and sales. “We use chatbots to narrow and filter but the actual service is delivered by humans.”
The group continues to invest in tech and its omnichannel strategy. It is evaluating fintech services such as cards and buy-now-pay-later services, “but this is a very regulated market, so we are evaluating it still,” says Muzzammil. “We invested in our chalets product, an Airbnb model, and we are seeing month-on-month growth of 30 to 40%.”
As such, he is bullish about the future. “Fortunately, for this region, we don’t feel it’s closed anymore. Everything is back and buzzing. Yes, there are geopolitical and macro-economic headwinds but there’s continued strength in consumer sentiment. Saudi Arabia is having a lot of events in Riyadh. The World Cup is coming to Qatar.
“We are at US$1.1 billion gross bookings for the first six months of this year. This is just the beginning.”
* This article originally appeared on WebInTravel
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