Tours and Activities Market Case Study

Tours & Activities
Travel Market Case Study
Anton Genkin
anton.genkin@gmail.com

1. Define sources of information on travel market (web-search).
2. Collect data and make overview of travel market (capacity, regions, segments, players, trends).
3. Define sources of information on T&A segment (web-search, travel industry portals, public market research,
experts opinions, press release and financial reports, startup databases).
4. Collect data and make overview of T&A segment (products, players, sales, forecasts, M&As)
5. Make in-depth research on major players (products, regions, traffic, sales)
6. Opportunities and Threats
7. Make a conclusion
Plan of the research
Skift.com, Tnooz.com, Phocuswright.com, Alexa.com, SimilarWeb.com, Datanyze.com, AppAnnie.com,
Crunchbase.com, Techcrunch.com, Google.com, Google Trends, Quora.com, Wikipedia.com.
Sources used

Travel Market by Segments
Car Rental
8 %
Tours & Activities
15 %
Flights
43 %
Hotels
34 %
Phocuswright 2014, 2015

T&A Market Evaluation
• $130B (Phocuswright, 2015)
• $100B – $200B (Peek.com, 2015)
$46B
$38B
$45B
Phocuswright 2015

T&A is not a market segment.
It’s an umbrella term for 50+
distinct segments.
Phocuswright 2015
Not a Segment

Phocuswright 2015
T&A Segments by Revenue
Tours & Excursions
Adventures
Performing Arts
Ground Transportation
Events, Sports
SPA & Wellness
Theme Parks
Cultural attractions
Museums
Natural attractions
Other 2 %
1 %
3 %
4 %
6 %
7 %
8 %
11 %
14 %
20 %
24 %
Tours and Activities
Ticketed Events
Transportation
Attractions
Other

Skift, Tnooz, Phocuswright, 2012, 2015
T&A Growth
2012 2015
$11B
$6B
$38B
$24B
Total Online
2012 2015
$13B
$9B
$46B
$37B
Total Online
YOY Growth – 14% YOY Growth – 6%
America
YOY Growth – 20%
Online travel activities bookings are growing signiﬁcantly faster than the total T&A market.
Europe
YOY Growth – 11%

Tnooz, Phocuswright, 2014, 2015
T&A Supplier Portrait
T&A landscape is ﬁlled with small local companies. 80% of those are still operate ofﬂine. 82% of the service providers
are taking bookings by phone or via email. They typically lack the resources and/or expertise to implement online
distribution of their products.
Email, Phone, Fax
82 %
<$250К $250К-1M $1M-5M $5M-100M >$100M
1 %
15 %
24 %25 %
35 %
Suppliers by Annual Gross Revenue T&A Bookings by Channels

There is no major platform or GDS to connect travel activity suppliers to travel sellers. Some attempts were made
like BookingBoss, Rezdy, Rezgo, TourCMS and others, but none of them dominates.
Online travel agencies have been too preoccupied with hotels and ﬂights to focus on T&A with its relatively low
margins and a myriad of very small suppliers. Though, now it seems major players got exited to go beyond their
core features and intend to become service solutions throughout the entire travel cycle, including aggregated in-
destination activities.
GDS
OTA are getting interested
Plenty of startups
Lack of attention from major OTAs drove to blossoming of T&A startups, which aggregate activities products by
contracting directly with suppliers. Often playing both a B2C and B2B role, aggregators provide connectivity and
access to activities content for other parts of the travel ecosystem such as online travel agencies, travel media sites,
and airline and hotel websites.

T&A Sellers
Expedia TripAdvisor
TUI

Expedia is one of the largest travel company in the world with such brands as Expedia, Orbitz and Travelocity. All
websites offer tours and activities from direct partners as well as from reservation systems: BookingBoss, Rezdy, Rezgo,
and TourCMS.
68М visitors per month
Audience by country Mobile appsWebsite trafﬁc
• United States – 81%
• Israel – 1.5%
• Saudi Arabia – 0.8%
• Canada – 0.7%
• United Arab Emirates – 0.7%
Google Play:
10М-50M
AppStore:
N/A
SimilarWeb, AppAnnie, Google Trends, 2016

Viator is wholly focused on tours and activities. It sells its products to a global consumer base at Viator.com, 60
additional consumer-facing websites, mobile websites and apps, and through its global network of afﬁliates. Viator’s
lists 20,000 tours, activities and attractions and 600,000 reviews, photos, and videos posted by travellers.
In 2014 been acquired by TripAdvisor for $200M. Later TripAdvisor been acquired by Priceline Group.
2015 ~ $100M (Skift, 2015)
9М visitors per month • United States – 40%
• United Kingdom – 8%
• Spain – 4.2%
• Australia – 4.22%
• Canada – 4.1%
Sales
AppStore:
1M+
Google Play:
500K-1M

2013 ~ $10M (Skift)
Sales
AppStore:
1M+
Google Play:
100K-500M
GetYourGuide is one of the hottest startups in the tours and activities sector, selling over 30000
products in some 2,500 destinations. They look for direct operators who offer tours, attractions and
activities. They have website, partner websites and mobile apps. Partner websites include travel
websites, online agents, hotel websites, and tourism boards. Till 2014 has been exclusive T&A service
provider for TripAdvisor.
• Spain – 5%
• Canada – 4%
• United Arab Emirates – 3.8%

A big part of online T&A sales is ticketed events – especially concerts, performing arts and professional sports. Tickets are
booked through well-established ticket sellers.
Ticket Selles
Live Nation

Live Nation is the world's leading entertainment company with ~1000 concerts listed and 500M+ tickets sold annually
worldwide.
• Canada – 2.5%
• Mexico – 0.9%
2015 – $1.6B
Sales
Google Play:
1M-5M
Google Play:
1M-5M

Europe’s event market leader with 22M+ tickets sold in 2015.
2015 – €215M
Sales
Google Play:
500K-1M
AppStore:
• Germany – 89%
• United States – 1.25%
• Austria – 1.1%
• Switzerland – 1%
• United Kingdom – 0.96%

A standalone part of T&A segment with big-names. Players provide customers with listings of nearby restaurants and an
seat-reservation in a click. Most players provide restaurant’s with business automation solutions.
TripAdvisor
Priceline Group
Dining
Michelin

Google Play:
1M-5M
AppStore:
OpenTable provides solutions that connect restaurants and diners online. The company seats about 15 million diners
per month at more than 31,000 restaurants. OpenTable charges restaurants a monthly fee to allow customers to book
restaurant reservations online.
• Canada – 4.2%
• United Kingdom – 1.2%
• Japan – 0.3%
• India – 0.2%

Google Play:
1M-5M
European major restaurant reservation service (the so-called OpenTable of France) operating under the ‘LaFourchette’
brand in French, ‘Eltenedor' in Spanish and ‘TheFork’ in English. Company offers an online and mobile reservation
platform for restaurants in France, Spain and other european contries, claiming to have a network of more than 40 000
restaurant partners.
• France – 16%
• Spain – 14%
• Italy – 8%

Google Play:
5M-10M
AppStore:
Zomato is a restaurant search and discovery service. It currently operates in 23 countries, mainly in India, Australia and
the United States It features restaurant information and other feature including table reservation feature.
• India – 32.7%
• Turkey – 6.5%
• United Arab Emirates – 6%

Currently 90% of all activities
are still booked in-destination
(Viator), but there are several
types of activities that
travellers are most likely to be
book in advance: music
concerts, music festivals, major
spectator sports and ski-
passes.
Segment by Importance and Booking Window
Phocuswright, 2014

Opportunities Threats
• Tourism industry shows a steady growth over the last 5
years. Number of tourists from emerging markets like
Asia and South America is increasing.
• Trends indicate that today's traveler wants a more
enriching experience than that provided by
conventional 'sun and sea' vacations. New generation of
‘millennials' has a well-known trait to get as much vivid
experiences as they can for as less money as possible.
• Increase of mobile data usage by travellers during
vacations to search for local activities.
• There is no distinct market leader in T&A segment. It is
still very under-penetrated segment compared to hotels
and flights. Several OTAs moved towards T&A segment,
but they display T&A products with no contextualisation.
• T&A suppliers are willing to increase online presence of
their products and services.
• There are sellers who are trying to consolidate
suppliers, handpick products and set standards of
service levels.
• Very large and fragmented market.
• Low technology penetration on supplier side. Still
mainly offline story with lots of paper and barcodes.
• Lack of flexibility. Last-minute bookings are usually
unavailable.
• Lack of standardisation of service levels and products.
• Travellers have strong behavioural pattern to buy
activities in-destination and in-person.
• General search engines like Google, Baido, Yandex
and user-review websites like TripAdvisor and
Foursquare invest a lot into local search, i.e. help
travellers to meet local T&A suppliers directly.

Conclusion
1. Online Tours & Activities segment is becoming mature.
2. It’s the right time for OTAs and meta-search services start exposing T&A products to customers.
3. Partnering with major T&A platforms as BookingBoss, Rezdy, Rezgo or TourCMS makes a lot of
sense for OTAs. Contextual embedding into Flights and Hotels verticals, combined with smart
upsale strategy (web, mobile, email, push) will increase ARPU.
4. Meta-search services are in trouble. Implementing of direct strategy «ﬁnd the best price» at the
moment is unlikely to succeed due to small search base (low number of T&A sellers) and low
price completion between sellers. Currently the best strategy for them is also be partnering with
T&A platforms mentioned above.
5. As customers have strong behaviour pattern to buy T&A product in-destination and in-person,
OTAs and meta-search services should expose products, which a likely to be booked before
departure, i.e. ticketed events, ground transportation, ground/water/air tours and ski passes.

Any questions?
Anton Genkin
anton.genkin@gmail.com

Tours and Activities Market Case Study

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Tours and Activities Market Case Study