The tours and activities sector has come into view as the next frontier for travel intermediaries, but online players continue to struggle as they navigate the highly fragmented space, particularly in Asia, impeded by software as well as inventory limitations surrounding these typically last-minute, in-destination purchases.
According to a PhocusWright study, only 20 per cent of tours and activities are booked online.
In Asia, the proportion of online to offline bookings is likely to be even smaller, industry players at WIT 2018 said.
“We’ve got a really long way to go. There are products out there in Asia… but they are not listed online because they are not ready to be sold online,” said Graham Hills, chief commercial officer, BeMyGuest, an online tours and activities distributor.
When working with OTAs on product selection, for example, the first thing the partner asks is if the product can be instantly confirmed upon booking.
“If not, we won’t even display it. So those don’t even go into the consideration set for online shoppers. We have a long way before products can be (made) available online, let alone be booked online,” said Hills.
While the PhocusWright study shows that the proportion of tours and activities suppliers with third-party reservations systems have quadrupled from 11 per cent in 2011 to 45 per cent in 2016, WIT panelists say the number in Asia is likely to be even less than 11 per cent.
Hills, for example, said many providers in the long tail of travel still lack the technology that enables distribution through online channels.
At the moment, tours and activities still tend be booked in-destination and with short lead times.
Said Mark Rizzuto, CEO of Livn: “When we look at resellers targeting the space, their inventory closes in the last 48 hours because access to live inventory is limited by technological capacity. There are below-the-surface challenges in the sector (and) enormous opportunities that are poorly tapped into.”
From a supplier perspective, the strength of offline, foot traffic and tendency for travellers to book activities on the day itself are reasons why some suppliers are not motivated to go through online third parties, according to Zishan Amir, general manager of Mega Adventure Group which operates the MegaZip flying fox on Singapore’s Sentosa island.
“Visitors to Sentosa (wanting to do activities) would have come to us anyway. What’s the purpose of having a third-party system?” said Zishan.
He added: “Many Asian travellers still rely on traditional travel agents to tell them what the itinerary is. They will do their research but still want to trust someone (offline).”
On the other hand, travellers from the US or the UK tend to rely on a larger travel website like TripAdvisor as their first point of contact.
While acknowledging the reach that marketing through third-party sites could bring, there continues to be “fear and trepidation” surrounding the loss of control over branding in that process.
“To engage some markets (directly) may be a costly exercise. (Alternatively, we could) use an intermediary that already has access. But for a lot of attractions, this is completely new.
“We don’t have the experience and resources for marketing, let alone digital marketing. There’s also a fear that once you (list on a third-party website) you lose brand control. We just don’t understand enough,” said Zishan.