Skift Take
Vacationers want to experience something new and are tired of the same old tours and activities. While global tour operators are baking more customization into their products, digital distribution is changing the way local operators do business.
What, exactly, is a tour? Depending on who you ask, you’ll get a very different answer.
For some, the idea of going on a tour conjures images of a packed motorcoach bumping along the countryside somewhere or exploring a city with forty of your closest friends. Others may think back to an intimate museum tour or being led into a home of a local chef for a dinner so delicious it still makes your mouth water.
It could be access to a guided walk purchased from a booth in a city center somewhere, or an indie concert in a laundromat somewhere purchased through Airbnb.
The truth is, the tours and activities space is undergoing a radical reinvention of what exactly it means to experience something on vacation.
Projections of the absolute scope of the global tours and activities market are inconclusive, but it likely hovers around $150 billion annually, according to Skift Research estimates, and is expected to grow nine percent annually over the coming years.
Tourism is one of the largest creators of a global middle class, with millions around the world rising in their local economy by offering services to visitors. And so often, immigrants to new countries are able to get a foothold in a new community through employment connected to the travel industry. When you consider the 10 percent of the global economy that travel accounts for, tourism is one of the most vibrant and important contributors.
The vast majority of tours, however, are still sold offline either in-destination or through traditional tour operator brands and travel agents; around 80 percent of the sector’s gross bookings take place offline, according to technology provider Trekksoft, and just 13 percent of those bookings come from operators with real-time booking connectivity in the field.
The global tour operator business has evolved over time, buoyed by the democratization of travel and the rising importance of experiences to consumers. Yet, online booking has been limited mainly to simple tours that are treated like commodities on sites like TripAdvisor and Viator.
A long tail of activities, scattered in destinations all over the world, will one day be bookable online, changing the economics of the sector in a fundamental way. The way tours themselves are packaged have shifted to reflect the demands of global consumers in permutations that challenge the traditional concept of what a tour even is.
In many ways, the tours and activities sector right now resembles the
