Thirty-five percent of global travellers have used mobile phones to book a tour or activity while already in their destination for a vacation, according to a 2018 Skift study. Seventy percent claim to have used mobile phones to help plan their itineraries, while 31 percent have even booked tour guides this way.

It is undeniable that tour and activities operators around the world are witnessing an abrupt shift in their business fundamentals. This is true in nearly every market, with Asia-Pacific seeing a particularly profound digital revolution of its own. In a world where the customer had limitless in-destination tour possibilities via a few taps and swipes on a screen, the days when operators could rake in comfy bookings by partnering solely with offline travel agents may be coming to an end. 

As the market evolves, traditional tour and activities operators in response are forced to evolve too. Terms like ‘instant bookings,’ ‘mobile friendly’ and ‘channel management’ have become increasingly accepted vernacular among stakeholders. As Darwin might say, it’s not survival of the strongest, but survival of the fittest. Here are a few reasons, in no particular order, why Asia’s tour and activities players need to evolve, and fast. 

Travellers now demand variety

The observable fact that experiential travel is now being packaged differently by operators is a likely indicator that consumer preferences in general are morphing. Sometimes this repackaging can even buck the definition of what some even consider to technically be tours or activities at all. 

Traditionally speaking, when operators think of ‘tours and activities,’ images of buses, museum visits and boat rides come to mind. It is less common to think of joining a local family in their home for an authentic evening meal. Building a hut with indigenous people in the jungles of rural Indonesia is not usually an experience you’d think of getting from a tour provider—much less booking it online. But these are precisely the kinds of experiences modern consumers are starting to demand, in addition to evergreen attractions like theme parks, galleries and others.   

In the past, travel was all about escape and relaxation. But recent trends have shown preferences shifting from escape to experience. Immersive, adventurous and authentic experiences, are now a key component to success for operators of all sizes. This is true according to travel advertising and meta search optimisation firm Koddi.

Intricate tours with complex offerings are more expensive to put together than your run-of-the-mill bus tour in Cebu. To keep up with competition, Asia’s operators need to continue cross pollinating their packages with complimentary service providers. 

No such thing as a millennial?

Some operators in Asia may think that having tour and activities bookable via web and smartphone is just for a customer base of 18 to 35 year olds. However, recent data shows that when it comes to consumer behaviour (inclusive of booking experiential travel), there may be no such thing as a millennial. Booking.com recently revealed that 80 percent of customers in general prefer to self-serve when seeking information, not just young people.  

In the context of travel searches in Q4 of 2017, 38 percent of those in Asia came from mobile devices, according to data-driven travel marketing provider Sojern. This number surpasses even those in developed markets like the US, where only 26 percent came from mobile.  

The chief digital officer of The Travel Corporation (arguably the world’s largest tour operator) recently said on the record that travel consumers of all ages and demographics are looking for immersive experiences and cultural connections. There is no real difference when comparing millennials to baby boomers. Offline operators who think they’ve already shored up an older customer segment ought to reconsider.  

Data is replacing physical assets

With travellers demanding immersive variety and operators recognising the need for closer collaboration with related service vendors, some brands are deciding to sharpen their competitive swords by going ‘asset-light.’ 

According to Boston Consulting Group, every company should seek to pursue its strategy with the lowest possible level of asset ownership, but determining the optimal level can be challenging. 

Hai Ho, CEO of Vietnam-based booking platform Triip recently told TTG Asia that data is one of the most precious assets for tour and activities operators today. Ho’s platform has put together a network of partners such as Dichungtaxi, TripRadius, Travelog and Keys China, representing a data ecosystem of more than 100 million users. “All of these small companies decided to work together because if they don’t, they would have to spend a lot on advertising,” explained Ho.

Ho’s advice seems to check out. After all, there’s no sense in paying to maintain a fleet of vans each year if the data is already telling you that you’ll see more lucrative demand from large parties. In such a case, wouldn’t it make more sense to just strike a deal with a local bus provider? Your competitors are likely already moving on this.  

The web will determine the winners

Cash from heavy-hitting investors and travel giants is pouring into Asia’s online tour and activities space. Globally, experts believe the industry represents a US$150 billion opportunity. Thus, if one online player from Asia can sew up even one percent of the addressable market, then investors have a company worth more than US$1 billion on their hands.

With this dynamic at play, digital businesses like OTAs and new e-marketplaces for experiences are cropping up each quarter. Stakeholders who can read the writing on the wall arrive at a fairly simple equation: whichever platform can facilitate the most bookings will win the war. It’s that simple. 

In the meantime, traditional tour and activities operators can benefit from this battle in the form of underpriced attention, more exposure to potential customers and easier sales in general.

However, with so many new platforms and solutions out there to choose from, it can be tough for operators to know which ones to partner with or how to even navigate the landscape. Fortunately, there are reputable tech solutions providers in Asia that can ease the pain, and there’s no substitute for experimentation.