STARTUP STAGE: Touriosity wants to help tour operators increase direct bookings

Touriosity

Nonprofit online travel agent Touriosity aims to help tour and activity providers increase direct bookings while complementing their own direct marketing efforts.

Founded in March 2020, the startup takes no commission on bookings; it charges $250 per year, and 100% of all booking revenue goes straight to the operator.

What is your 30-second pitch to investors?

Touriosity is an online travel agent with a conscience. Our main focus is to help tour and activity providers increase direct bookings while complementing their own direct marketing efforts. We are also a non-profit and take no commission on bookings, unlike the large OTAs. We only charge $250 per year per provider, and then 100% of all booking revenue goes straight to the operator.

Describe both the business and technology aspects of your startup.

As a non-profit organization, we have a small team of only two running Tourioisty. We want to ensure that all funds contributed by the participating tour operators go towards maintaining and marketing the platform.

We use existing reservation platform technologies that our operators use and incorporate these into our website. This allows us to keep operating costs down to a minimum.

Give us your SWOT (Strengths, Weaknesses, Opportunities, Threats) analysis of the company.

Our biggest strength is being an operator-led platform. We provide 100% of the booking revenue to the operator while also providing the full customer details, something most OTAs withhold.

Although we know competing with the "big boys and girls" of the industry will be challenging, we feel there are opportunities to gain ground and compete, especially by using platforms like Facebook. We also feel that consumer mindsets are already changing, with an increased focus on helping small local businesses after the devastating effects of COVID-19.

Our weakness is not having the cash war chests that the big players have. And therein lies our threat: They can always outspend us to try to keep us away from a fair fight.

What are the travel pain points you are trying to alleviate from both the customer and the industry perspective?

From an industry perspective, the main pain point for a lot of tour operators is the ever-increasing commissions and extra charges charged by the large OTAs. Even during COVID, fees have increased as OTAs try to claw back lost revenue. The profit margins for small operators continue to shrink and it’s becoming unsustainable.

When COVID hit, Touriosity founder Chris Torres opened up his schedule to offer free one-to-one consultations with tour operators worldwide. Some of these conversations were inspirational, as some operators spoke about doubling down, changing focus and finding new ways to make sure their businesses could survive. But, equally, many conversations were heartbreaking. Some of these operators were close to tears, worried about the survival of their businesses, looking for guidance and answers.

What became clear out of those 80-plus conversations was that operators who are 50 to 100% reliant on bookings from OTAs were the worst affected. Yes, you read that correctly. More operators are closer to the 100% OTA-reliance mark than you would think, and many of them only focus on a couple of OTAs.

Those OTA-reliant operators were hit so hard because customers were instantly refunded by OTAs, not giving the operator a chance to offer a postponement voucher or to reschedule bookings to maintain some of this year’s revenue. This inability to negotiate with customers is what happens when tour and activity operators have no access to their customers’ data and when they are disconnected from revenue streams through third parties.

OTAs can be a force of good. They can help generate extra income and reach an audience that operators may not be able to otherwise. But, post-COVID, losing out on 20 to 40% OTA commission is no longer a viable option for most operators.

To put this into numbers, if an operator generates $100,000 per year and is 50% reliant on a handful of OTAs at the low end of commission, that comes out to $10,000 per year. That is a lot of money that isn’t landing in operators’ pockets - money that is especially important to operators after the devastating effects of COVID. And the lost revenue only goes up from there for more OTA-reliant operators and those paying higher commission rates.

For customers, Touriosity offers a chance to directly impact tour operators worldwide. Travelers are getting savvy to the way the industry works and they’re making greater efforts to support small businesses, to encourage sustainability initiatives and to have a positive impact on their destinations. Touriosity offers a platform where tourists know that every booking is beneficial to the operator. We’re offering a simple, streamlined way to positively impact the lives of locals wherever you travel.

So you've got the product, now how will you get lots of customers?

Facebook Advertising will be the main driver for awareness and growth of Touriosity and its members.

As we also own and run a marketing agency (Tourism Marketing Agency), we understand very well how to get the most out of this medium. We will be using our experience to raise brand awareness, helping inform and change the mindsets of consumers towards supporting local businesses.

We will also have a number of content initiatives to drive awareness and traffic.

Tell us what process you've gone through to establish a genuine need for your company and the size of the addressable market.

Our founder Chris Torres is well-known in the tour operator industry as he speaks at many events, offering advice on marketing. He also produces a highly regarded podcast and video series called The Digital Tourism Show, and is also the author of the best-selling tour operator marketing book, Lookers Into Bookers.

Between Chris’s knowledge and that of his agency's team, he has seen first-hand that operators are demanding change. They want something different and are sick and tired of standard OTAs charging more and making impossible demands of their business. COVID has highlighted the shortfalls of the existing OTA ecosystems... and a lot of operators are ready for change.

Those one-to-one conversations highlighted this readiness and the overwhelming support when we announced Touriosity proved its value. We had over 700 tour operators register their interest in the first 24 hours. At the time we launched the Touriosity site, we had over 1,200 tours listed in countries all around the world.

Due to our small team, we couldn’t take on every interested tour operator right away; we need to incrementally increase the tour listings, but we have no doubt that the interest exists from the industry side. And, given the global nature of our tour operators, the addressable market is equally global.

How and when will you make money?

As a non-profit organization, we reinvest every contribution into marketing and running the platform. We make no profit.

What are the backgrounds and previous achievements of the founding team?

Chris Torres is an author and brand and digital tourism expert with over 26 years of industry knowledge. He speaks at tourism events worldwide, offering his advice and guidance on how travel, tourism and destination businesses can gain brand recognition and increase bookings.

Chris has focused his business, the Tourism Marketing Agency, on tour operator marketing. Over 90% of his client base comes from outside the United Kingdom (where he is based) and he and his team work with some of the biggest players in the industry.

Chris is the author of How to Turn your Online Lookers Into Bookers, a 400-page book filled with practical marketing advice dedicated to the tours and activities sector.

Chris also produces a video advice series called The Digital Tourism Show, which you can watch on his Facebook Group, YouTube channel, or listen to on Google or Apple podcasts.

What's been the most difficult part of founding the business so far?

It has actually been fairly easy. With decades of experience in marketing and our specific focus on tourism, we simply tapped into our existing global network about our intentions with Touriosity and the operator response was immediately positive. As mentioned, over 700 operators registered their interest within 24 hours.

Generally, travel startups face a fairly tough time making an impact - so why are you going to be one of lucky ones?

Touriosity is not driven by investors or shareholders, so we can keep our focus on the local businesses we are trying to help. That means we are not chasing the next revenue generator for Touriosity; we’re just focused on getting in front of consumers on behalf of our operators.

A year from now, what state do you think your startup will be in?

We think we’ll surprise people! We believe we can show a different way for an OTA to run and we know we can inform travelers that there are better, more sustainable alternatives out there. We predict we will go from 1,200 tours (at launch) to five times that in a year's time.

We also know we’ll help make a positive difference that this sector sorely needs.

What is your end-game? (Going public, acquisition, growing and staying private, etc.)

Success, for us, is simple: Driving direct bookings for our operators, growing the Touriosity brand and keeping it operator-led. In time, we would like to hand over Touriosity to a consortium of operators to maintain the ethos of the brand.