Tripadvisor-owned online travel agency Viator set the tours and activities community abuzz a couple of months ago when it introduced a new commission rate structure for operators on its platform.
While some operators say the marketing program, called Accelerate, has sent views of their products “through the roof,” others see Viator’s move as “shameful” and the kiss of death for OTAs – ultimately driving more business toward Google.
Viator president Ben Drew is no stranger to controversy in the sector. Just one year prior to Viator’s introduction of Accelerate, Drew was tasked with quelling concerns that Tripadvisor was selling off the tours and activities brand after it was announced that the two companies would operate independently.
Below, Drew – who was vice president of business development and strategy for rentals and attractions before assuming the role of president of Viator - explains what Viator has learned from Accelerate, responds to criticisms of the program and gives his overall view of the tours and activities landscape moving into 2022.
Can you give an overview on the current state of Viator’s business, including the recent launch of your Accelerate program?
If you look back over the last 18 months, the travel industry was impacted very heavily, and we were no exception. In the last nine months we’ve really seen an enormous resurgence in Viator, in demand for Viator and in demand for the product that we have to offer.
I and the team feel very privileged to be working in this part of travel that people have missed so much and clearly have so much pent-up demand for the type of product that we offer.
We are kind of adventurers at heart; humanity in general is. Travel is in particular, and this is something that we offer at Viator and something that we’re on a mission to really bring to travelers. Over the last nine months, we’ve seen a significant resurgence. We’re well above 2019 levels now in 2021, and even amid this new [coronavirus] variant we’re still well above 2019 levels of demand. That’s not to say demand is the same as it was pre-pandemic - it’s changing significantly, as you might imagine.
There is a lot more U.S.-to-U.S. domestic demand, and destinations within North America saw demand double or even go up by 5x even. … The types of activities that we have seen enormous demand in have changed too: Activities are more outdoor-based or water-based. The scale of demand for them has been really encouraging and quite impressive.
What does that tell us? That tells us that the desire for travel, the desire for adventure and the wish to bring a little bit of wonder back into people’s lives is still very much there and it’s stronger than ever.
So let’s think about Accelerate: A challenge that operators face is how to stand out from the crowd with the market in resurgence, that’s both on the traveler and supplier side. We listen to our suppliers on a regular basis, and they ask us how they can stand out from crowd. These are the kinds of conversations we have every day of the week with our operator community.
We came to this product that we’re calling Accelerate. It’s an advertising placement product. It allows a supplier to essentially pay for visibility on Viator and it does so through advertising placement.
We launched it in trial earlier in Q3 and now have launched on a more widespread basis across the U.S. So far we’ve seen adoption rates that we’re very encouraged by. We’ve seen double-digit percentages of adoption after just a few weeks of launching in the U.S. and that number is growing every week.
The anecdotal feedback from suppliers has been very positive as well. We’ve had suppliers reporting 100% or even 200% increases in demand through joining the program, which is significantly above the public number that we put out there, which was 15%. Anecdotally we’re seeing larger numbers among those that were early adopters of the program. That’s the story there, really.
It allows operators to stand out to the crowd. It’s an advertising placement product. What it really does if you’re an operator is it allows you to have a more flexible advertising relationship with Viator.
Accelerate has certainly had mixed reaction from the tours and activities community. Specifically, it’s been said that the program pushes smaller operators toward Google, and that it’s “shameful” and signals the “death of OTAs for many operators.” How do you respond to that?
It is early days in the program, and we’re listening very carefully to all operator feedback.
Actually, the program is designed not specifically for any one group of operators large or small – it’s equally applicable to all operators. Some of our best feedback has been from operators that are on the smaller side.
It’s early days and we don’t know how the product will evolve. Of course we’re looking very closely at how this product might or could change the marketplace but basically what we’re seeing is a positive trial, a positive uptake of at least testing the product, and those who are in the trial seem to be getting results that they’re pleased with.
Have you made any tweaks to the product thus far after receiving feedback?
It’s only been live for a small number of weeks at the moment, so it’s still in early stages of doing that. This is a product that is going to evolve rapidly and continuously for months if not years to come.
We listen to our suppliers on a regular basis, and they ask us how they can stand out from crowd.
We want to have operator feedback. Our account managers are in very regular connection with our community of operators to get that feedback, to encourage them to try it and see what the results are.
We know that it’s important to operators that they can measure their results, and we’re providing tools in the logged-in area of Viator to help them do that.
Those tools and the various controls on the product that operators can exercise are going to go on a journey over the coming months and quarters to turn this into the leading advertising product in this industry.
Overall, have you felt more pressure from Google, especially as it expands its Things To Do offering?
Google has been in space for good long time. Touring Bird, back in 2018, was their experiences play at the time, which I remember pretty well.
They shuttered it, and then there was a product called Reserve with Google. And now they have another iteration of the product which is [Things To Do]. We’re a partner of course. What I conclude from this is they’re making a lot of product evolutions in the space. They’re certainly interested in it, and we are partnering with them to do this.
Overall, I think it’s good sign in the industry that a company such as Google is taking such an active interest in the space. It’s very validating to see the attention that they’re putting on it – but that’s not to say it’s easy. That’s not to say that you can master this space quickly.
Viator has had 20-plus years of history, learning and optimizing this space and has a team entirely dedicated to mastering the challenges that operators and travelers looking to book experiences face. We’re partnering with Google right now. We think that the attention that they’re drawing to the industry will be positive in the long term, but it’s probably too early to say what the ultimate impact will be.
From the consumer perspective, how important is the “brand” they book with? And how are you endeavoring to make the Viator brand top-of-mind?
The past 18 months hasn’t been the best time to put an emphasis on any travel brand, I’d suggest, when people have been traveling less. But as we look over last nine months and looking into 2022, that’s absolutely an area that we see tremendous potential in.
We’ve done a number of trials on brand building and brand communication throughout 2021, all on a test basis, but we’ve learned just a tremendous amount about how to drive awareness and brand awareness in particular of Viator on a small-scale basis.
We intend to put that to wider use in 2022. Like I said in the beginning, we believe we’re at a very exciting time for building that part of the Viator story.
What do you make of branded tours we’re seeing in the space, such as GetYourGuide? Is it something Viator has considered?
That’s not a direction that we’re considering. It’s not a direction we’re going in at the moment. Actually, we’re more interested in helping operators tell their story and be a part of that story – bring out what’s unique about operators.
Our core focus is on the marketplace, making it incredibly easy, making it incredibly compelling and bringing that wonder to travelers –and at the same time being flexible and bringing global exposure to our operator community.
That’s our core focus at the moment. The branded tours is not the direction we’re going in at the moment.
In April of this year, Viator began sharing some of its products with Booking.com. How has that partnership been going?
If you zoom out a little: Viator has a very significant and healthy and expanding business where we power the experiences supply for all kinds of businesses, including Booking.com and a number of other global OTAs. We think we’re a leader in that space of powering the businesses of other travel companies and other travel content sites.
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With respect to individual partnerships, we don’t talk about specifics with them, but we’re very pleased with the cooperation that we’re seeing, and we’re very optimistic about the future of that and many other partnerships in that part of the business as well.
In January of 2020, it was announced that Viator will operate independent of Tripadvisor Experiences – causing speculation of a sale, which you put to rest. What have been the benefits or consequences of operating independently?
Around Q1 of 2020, the business was arranged in order to go after the very specific goals that Viator should and could go after in this industry – namely to win the market in tours and experiences. That also allowed Tripadvisor to go on its path slightly separately as well because it has a different mission.
It really freed up both brands to move quickly, to move somewhat independently while sharing learnings with one another and have more focus. So from that perspective it really delivered what it was intended to deliver.
As we sit here now at the end of 2021, we’re incredibly optimistic about where we could take the Viator business in 2022.
Could that strategy change with a new Tripadvisor CEO, with Steve Kaufer retiring?
I think it’s far too early to say really. It’s always possible that strategy shifts with any new leader, but I think it’s far too early to speculate on specifics as it stands today.
What I do know is we’ve come a tremendously long way from the worst of the pandemic, and the last nine months have seen a very strong resurgence to above 2019 levels, significantly above 2019 levels of demand. We at Viator see a tremendously strong 2022 coming up.
Speaking of a resurgence in travel, we’ve seen massive funding rounds recently go into tours and activities players such as Peek, GetYourGuide, Klook and Rezdy. What does that signal in the industry?
It signals that this industry is extremely healthy, that there are big expectations of this industry and a great many people are putting capital to work in the companies that are major players in this industry.
Overall think it’s a very, very healthy signal.
Do you think we’ll see continued investment or consolidation?
I suspect that it’s likely that we’ll see continued investment. We’re seeing investment throughout this period, and as travel recovers, I think you’ll likely to see more – but I can’t say for sure. I don’t have a crystal ball, but I can certainly say it’s an exciting time to be in this part of the industry.
Finally: Any predictions on a new Tripadvisor CEO?
I don’t have any predictions on a new Tripadvisor CEO. The amount of change that Steve has seen at the helm of Tripadvisor over his 22 years, and the impact that Tripadvisor has had during that time is just staggering. I wish him all the best for whatever comes next for him. I’m very hopeful that whoever it is will take Tripadvisor on its next adventure.
I’ll reiterate from my perspective there’s never been a more exciting time to be in this industry and be at Viator. The next 12 months could be really game-changing for us.