The market for tours and activities is growing at a rapid clip but the opportunities are not where you think they might be. Pamela Whitby reports

When TripAdvisor announced its $200 million acquisition of Viator last September, the intentions of the world’s biggest travel company were clear. It was staking a claim in the fast-growing tours and activities space.

So this year, when Viator announced the launch of the first self-service platform for suppliers to load their products, it was clear that the stake had been firmly hammered in.

Yet that isn’t stopping new blood from entering the tours and activities fray.

Two years ago trip4real launched in Spain and this year we have seen other other market entrants including Vivaster and Tourboks.

“I see this as a new, growing market despite the fact that there are players like Viator that have already been operating for 20 years,” says Kirill Khromov, CEO and founder of Vivaster, which launched this January. “The fact that new players are popping up every two weeks just proves this assumption.”

Khromov puts this down to the fact that more and more people are looking to book their cultural leisure experiences online. Although it is still early days, Khromov believes Vivaster is still able to differentiate and is doing so not only by offering handpicked and verified tours only, working directly with local suppliers and private guides but also by not reselling offers from other booking platforms.

“We pay a lot of attention to the quality of the tours,” he says, and to keep suppliers onside, it has a strict policy of guaranteeing exclusivity. “So if we have a walking sightseeing tour in Paris from one supplier, we wouldn’t add similar offers from others.”

For trip4real founder and CEO Gloria Molins, the most important thing for any company with an online presence is reputation.

“No matter how much good PR or communications you do, travellers will always spread the word about a good or a bad service.”

That may be true, but the more B2C marketplaces that exist, the higher the customer acquisition cost, particularly on the search engine marketing side. Clearly, the scale and reach of the big boys such as Viator will give them the edge, and it will be harder for others to compete.

After all, Viator’s marketplace offers suppliers “access to 340 million monthly travel planners, 3,000 global affiliate partner websites and over 175,000 travel agents”.

Structural opportunities

It’s undeniable that companies such as Viator are growing their online sales at a rapid clip. However, they’re still only accounting for a small fraction of the total worldwide tours and activities spend.

This is where it starts to get interesting.

Alex Kremer, co-founder of Actourex, a platform to help attractions and resellers issue and accept mobile and electronic tickets, says the reason is structural.

“The back-end plumbing for suppliers to effectively distribute their products through third parties is still fairly lacking,” he says.

Electronic reservation systems, channel management and effective CRM tools are less widespread among suppliers of tours and activities than other travel verticals. This lack of infrastructure makes tours and activities much more difficult to buy and distribute. As Kremer explains, printed vouchers are still required far too often. Moreover, last-minute availability for tours is another big issue.

“Things like that need to change before online sales of tours and activities can really take off, so that’s where the opportunity lies,” he says.

Chryssa Oikonomidou, general manager of Tourboks, certainly understands the need for a seamless customer experience. She talks about the “journey of purchase” recognising today’s consumers are not only mobile and social but also want to book ‘on-the-spot’.

Khromov agrees: “Everyone is going mobile today, so we have to offer our clients a useful solution for booking in destination and with instant confirmation.”

On that score there is still work to be done.

“One problem is that suppliers are very slow to adapt and change – it’s a long, tough road and not something you can expect to show Silicon Valley-style speed of uptake and growth,” Kremer says.

Still, it’s worth a try.

Join EyeforTravel in London for The Connected Traveller (October 22-23) to hear more about emerging opportunities in the fast-evolving world of travel