What’s Next for Tour Operators at Skift Forum Europe 2022

As damaging as Covid was for tour operators, the inability to conduct trips provided companies in the sector a valuable opportunity to reevaluate their all aspects of their businesses.

Ulla Heffer Böhler, chief operating officer for the Travel Corporation, and Travis Pittman, the CEO & co-founder of TourRadar, told Skift Senior Travel Tech Editor Sean O’Neill at Skift Forum Europe 2022 on March 24 what changes they realized they had to make. Böhler said Covid forced her company to take another look at, among other things, group sizes and domestic offerings while Pittman stated TourRadar was forced to look at what markets it was targeting.

Watch the full video of the conversation, as well as read a transcript of it, below, to hear how Böhler and Pittman used the pandemic-induced pause to develop new tours.

Sean O’Neill: Hi, Ulla. Hi, Travis. Thank you. The pandemic was especially hard on the multi-day itinerary based tour operator segment. Partly because of the start stop, start stop nature of the restrictions, which made it difficult to stitch together inventory at the last minute. Also, you have the cross border nature of your demand, your customers coming in. However, we’re going to assume that is going to be behind us. We’re going to have a forward looking conversation today about the opportunities in the multi-day sector, especially digitization and the new focuses on experience brings a lot of opportunity.

If you have any questions, if you’re here or are watching us online, please use the questions in the app and we’ll get them to towards them at the end.

Ulla, I’d like to start with you please. Last year, the chairman and founder of The Travel Corporation, Stanley Tollman, he unfortunately passed away. But before he did, he had a message about the opportunity that’s now facing the company. Maybe you can tell the audience here about that.

Böhler: Absolutely. My pleasure. And thank you for having me here today, Sean. So Mr. Stanley Tollman, our chairman and founder who sadly passed away last September, was an incredible man and visionary, and he’s really built TTC from the ground up over many decades. And throughout the pandemic, he really was our guiding light. Having lived through so many crisis before and always navigated them brilliantly.

And in September, shortly before he passed away, his message to the executive team was TTC has always come out stronger of a crisis no matter what it was. We’ve always dealt with it. We’ve always survived it. But not only that, we’ve come out stronger. And as I look out into the world and what is ahead of us, I do believe post pandemic, this will be the single biggest opportunity we have ever had. I’m going to be really sad. I’m not going to be here for this, but please team, make sure you don’t miss it and you make the most out of it.

O’Neill: Okay. Well, let’s build on that. It’s very inspiring. So what are some things that you guys have been doing in the past few years that are innovative changes in your product, changes in your operation?

Böhler: Well, what haven’t we changed? I think we were all thrown into the deep end dealing with something that none of us had ever dealt with before. All of us have been in the industry for many years and we’ve had SARS and you’ve had 9/11, but nobody ever has had a crisis of this magnitude. And we were really forced to reevaluate everything.

Let’s start with our product offering. When we realized that Australians, for example, wouldn’t be going anywhere anytime soon, we said, we have such a loyal following of past guests in Australia. Traditionally they all love to travel to Europe with us. We know Europe isn’t on the agenda for Australians anytime soon. What can we do? Why don’t we bring them the tried and trust Insight Vacations quality to Australia? And in normal times, we would have said it takes about a year to launch a new domestic product and put it all together and contract it and come up with a marketing plan. And we knew we didn’t have that luxury of time. So we pulled together very quickly a domestic program launch in Australia, bringing the tried and trust Insight Vacations quality to our very loyal Australian guests.

We also expanded our North American domestic offering. We’ve always had a domestic offering there, but again, it was never a core focus. But obviously given the changing landscape, it did become a core focus.

We also looked at a group size. Insight Vacations always had slightly smaller groups, [inaudible 00:04:38] slightly larger groups. But the group size conversation came up consistently of customers asking, how big is the group that I’m going to be traveling in? So we again very quickly launched different group sizes, something from small private groups where you can take over an existing departure and travel only with a group of 12 plus, privatize your departure, very own travel bubble. Or small group departures with a maximum of 24. Or classic departures again, something we normally would’ve planned out a long time in advance and we just did it really quickly because we felt we needed to.

O’Neill: Yeah. So it’s optional small size tours. So do you think that’s a trend that will last beyond the pandemic? Is that something you’re going to keep in your product offering?

Böhler: I absolutely believe it is here to stay and it’s not a one size fits all. There is a customer for whom it is irrelevant. They’re very happy with our classic group size, but there absolutely is a market for a smaller, more niche experience. And I do think that is of the trends that is here to stay and having the choice and having the flexibility is absolutely key.

O’Neill: Well, if we were having this conversation, Ulla, about five years ago, I could imagine if I asked you, why is it in the multi-day tour sector you can’t really go beyond a year or two, a lot of the companies, in order to offer in their schedules and availability too? You would be able to give a very methodical, pragmatic reason of these are the reasons we can’t do it. But you said when you’re putting together the material for Australia, you were able to do it. So talk a little bit about the new agility.

Böhler: Yeah, that’s a great question. Thanks, Sean. And in the past, as I said, we had a very set cycle in the year. I could tell you in September, this is when we launch our Europe offering for the following year. But in this new crazy world, everything was turned on its head. We knew we had to find a way to come to market earlier. And it wasn’t the question of, can we do it? The question we ask ourselves was, how can we do it? And if you take that mindset and that approach, you find a way to make it happen. Not saying it was easy, but if you put the right people into the room and you focus and determine to find a way to do it, you always will find a way.

So we’ve now across all of our TTC brands, we always have at least two years worth of trips on sale at any given time. And again, that is something that is here to stay. We’re not going to revert back to our old ways. We found different and more agile ways of working and they will absolutely be with us for the long term.

O’Neill: Fantastic. Well, Travis, to bring you to this conversation, if you talk to people in the multi-day, people who are investors or analysts who are not in the sector and you’re trying to explain the multi-day tour operator opportunity, what are some points of education that you try to explain to them that they aren’t always up to speed on?

Pittman: Yeah, I think a key one is it hasn’t always had the best rep, I think group travel and group scheduled tours. And I think it’s getting through that and actually getting across that a lot of people take tours and adventures. And so I think trying to get them to relate someone wants to take a trip with 20 or 50 other people. People actually enjoy that. They’re not just chained to that group. So I think that’s been a bit of education for us. Where they can understand it better is when you say, would you like to go on a private safari or an adventure to Africa with your family? And then they can start to picture it. That’s complex. That’s hard to put together. How do I do all that? How do I get the logistics and all that.So once you start to get into it, there is a bit more understanding.

But I think also what’s been great over the years that we’ve seen is the innovation that the tour operators have had to do. I think the bad rep been there, but they’ve had to innovate or else the customers just wouldn’t want to book this stuff. So it’s been really interesting to see how that’s been evolving the smaller groups now, but also just how it’s really focused around the experiences. And I think we talk about tours and activities, but our sector of multi-day, that’s what it’s all about. It’s the experiences. It’s the hot air ballooning or the white water rafting or the wine tasting and all these different things. It’s all done for you. You don’t need to go to an app and go, what am I going to do today? And you’ve got someone holding your hand.

So I think it’s just education of that process and actually people understanding in this new world as well, it’s actually very simple. I don’t have to think of, what if I need to cancel? I’ve got my train, I’ve got my hotel, I’ve got this. It’s all in one, having one person to go to and actually deal with as well. So I think it’s how you get the communication of what we actually sell was key to investors understanding the space actually.

O’Neill: Okay. I’ll call for a brief video to illustrate one of your products, but experientially, you’ve developed a Wander Women product. Maybe tell us a bit about that to capture.

Böhler: Sure. And just to augment what Travis just said, it really is all about the experiences. It’s about immersing you into the destinations and having those deep and rich experiences, whilst at the same time, you don’t need to worry about it. We take all the complexity out of it. We do all hard work. We’ve got connections and you just show up and have a good time.

And I think in this world probably five years ago, a lot of intrepid travelers would’ve said, oh my God, I’m going to get a hire car. I’m going to drive around Europe. I’m going to do this on my own. In this new world, I think things have shifted a little bit. And the complexity that is out there figuring out what do you need to do in this country, what are the regulation in that country and the regulation are changing every minute. I really think that has shifted the mindset of a lot of people. And we have heavily invested in our experiences. It’s always been front and center of what we do, but it really has come to the forefront in recent years.

And one of my passion projects are our Wander Women journeys. Again, it comes from feedback from our guests saying we would love to have an all female trip. Can you put something like that together for us? So we did launch our Wander Women journeys a couple of years ago, timing wise coincided at the beginning of COVID. So obviously not ideal, but I wholeheartedly believe those journeys are incredible, designed by women for women, with meeting incredible women entrepreneurs in the destinations. And we’ve got a wonderful journey due to Croatia, which we’ll be traveling in June this year. And I think we’ve got a little video that we might be able to show.

O’Neill: Yeah, let’s bring video up, please.

Speaker: My friends at Insight Vacations recently launched something that is very close to my heart, their Wander Women journeys, which have created for women and by women with a goal of empowering women travelers on exclusive trips that celebrate women’s success around the world. I’m particularly excited about the Make Travel Matter experiences on the Venice on the Croatian Coast. Insight and their non-profit TreadRight Foundation have worked with the United Nations to identify experiences that make a positive impact.

O’Neill: Sounds very well put together, has good illustration. So Travis, you’ve for many years at Tour Radar, you’ve had online travel agency. You’ve helped about 2,400 tour operators market their goods online. You in November expanded your business model. You’re now going to the business to business. So tell us what you’re going to be doing.

Pittman: Sure. Yeah. So prior to Covid, we were very much focused on B2C. So actually getting the multi-day tours and adventures sold online. So we work with I think 2,700 and around 50,000 different adventures. And as the pandemic hit, we looked at what can we do to actually help the whole industry also come out of this stronger as well? And as part of that, maybe we can queue up the ecosystem diagram. We actually launched in November what we call the adventure booking platform. And it’s a category with both the B2C element, which is our core business, but also with a distribution piece, so B2B. So how can we get these great adventures and great products in the hands of other partners?

So we know traditionally this has been sold offline, so travel agents have sold this product. About 80, 90 percent is still being sold through offline. And many opportunities came up. We had travel agents using Tour Radar before and actually we never focused on it. And then we had a few big partners like Flight Centre actually, which probably is one of our bigger competitors, also reach out to us and say, how can we work together? And I think it was also being pushed by a few of our partners saying, Tour Radar has the best technology in this space. Let’s try and do something there.

So we basically built out our API now where partners can take that, get one API, 2,500 operators, 50,000 adventures, and actually be able to sell that product in their own way. So we also saw an opportunity that the likes of Shopify and Etsy also did prior to the pandemic and also during the pandemic, in terms of giving a voice to small and medium sized businesses of them selling online. We know that payments are a big problem, communication, messaging, email, CRM, all that stuff. And that’s something that we’re also as part of our ecosystem building out, is this shop functionality where SMEs will be able, so small operators-

O’Neill: So is private tours as a new product?

Pittman: That’s also, yeah, for sure. So we built during the pandemic the capability for private and tailor made adventures. And that’s actually now we’re seeing that grow really nicely, a bit to the smaller group stuff. People wanting to travel in their own bubble. And we’re even seeing, we call them organizers and it could be an organizer of a team offsite like a retreat for workplaces. Or it could be an example we had was a Facebook group of 5,000 members. The admin put together a trip for 30 or 60 people to go to Greece. And so we’re seeing really big groups going because we also rolled out payment solutions where usually the lead passenger gets stuck with having to pay for it all and then try and get the money back from people.

O’Neill: I’ve been that guy.

Pittman: Yeah, and that pain is a real pain that we’ve solved where now the lead passenger can send out a link to every single person, and same with a travel agent where they can actually get the customer putting their own credit card in. So it’s all responsible for that individual rather than the lead passenger. So it’s really been about how do we bring the ecosystem together, put this great products in the hands of third parties. So OTAs, content sites, that type of thing. And we’re seeing great traction also on the onsite travel agents. So little independent agents who have a great list of customers that they sell to, can now actually sell this product as well. And we’ve had since November over 1,000 travel agents sign up for that and seeing some really good traction on that at the moment.

O’Neill: Okay. So there’s a little bit to unpack there. So you have the adventure booking system. And so the Flight Centre, if they want to get access to the Wander Women tour, they can go through Tour Radar and now get it, which that’s what’s new.

Pittman: Yes. So they have an API connected to their system. So it’s called Helio, I believe. And then the travel advisor sitting in the shop can just call from their home screen and actually say, I’d like to book the Wonder Women trip. And then we communicate via the API with TTC and it all just basically gets plugged into the system. So we’re effectively the plumbing or the GDS of this type of product.

O’Neill: Okay. And so Skift research did a multi-day tour report so I’m cribbing from that. But my understanding is that when you were mentioning the private tour, there’s been in the past, a decade ago it’d be much more common. In destination, you’d have local tour operators who actually do handle the operations. And then in market for the retail sales, you have different people who are helping to source to customers. But now thanks to using Tour Radar, you can have the local wholesalers would be able to directly reach their market. How close is that?

Pittman: A bit of both. So we definitely see the bigger tour companies, the global ones, they have their local ground operators that they go through. Some own them, some use third parties. And we are seeing DMCs, so directly coming-

O’Neill: DMCs are direct-

Pittman: Destination management companies. So the ones who actually are running the trips on the ground. And so they’re actually coming on because they can actually offer the product. They can’t offer the same product that they probably offer to someone else, but they see an opportunity there. And because of the social proof we provide, they can get reviews from customers and that sort of thing. So they can actually start to build a presence in the marketplace as well.

O’Neill: That’s interesting because, 20 some years ago you would have the travel agent was bundling the trip and then Expedia and Booking who we heard from earlier on stage, they unbundled the trip. And now through the technology personalization and skill, we’re now rebuilding it. But the suppliers have to get much savvier tech for that to happen. They have to be able to be able to do real time inventory and connect. And your business to business offering is a piece of that puzzle to get forward. Is that right?

Pittman: Yeah, exactly. So I think the unbundling definitely has happened. That’s been driving for the last 20 years with what Ulla mentioned of the benefits of this style of travel rebundling, where the simplicity of a very complex journey over 7, 12, 15 days is all taken care of. And so, on the mega trend of unbundling this year, I call a little bit of BS on that just personally from my side, but I think it’s really this will be about simplicity and the customer wants simplicity. And yes, our system, we provide instant book ability so that if you actually click and put your credit card in, it’s instantly booked because we have direct connections to the APIs of a lot of these providers. And that’s an advancement that just five, ten years ago, just wasn’t there. You had to wait 48 hours for a confirmation. And it’s really trying to now have an API that an Expedia or a Priceline, whoever it is, would want to take and actually get that instant confirmation to be able to potentially package that up with flights and other ancillaries as well.

O’Neill: So Ulla, we have a question from the audience for you about The Travel Corporation. What’s the update in regard to your refreshing? Will you be overhauling your product range or simply adding more fresh product to it?

Böhler: Yeah. Great question. And that is something we constantly always do. We’ve got I call it a process of continuous improvement. We are never going to sit still and say, everything is wonderful and things are amazing. We’re always looking for new opportunities and new ways. But obviously at the end of the day, what is driving it is what is right for the consumer. If it’s not right for the consumers, it doesn’t matter how much we think it is amazing. It has to work for our own guests. And right now we are seeing some really interesting trends. And they’re interesting, but they’re not surprising. We saw earlier when [Gert 00:20:18] presented, all of the money that people haven’t spent in the last few years, we are seeing people buying longer trips. Again, they’re taking their dream vacation. They’re adding Orient Express to their luxury gold journey. So it’s really about those bucket list trips. And I’ve always wanted to do this. I’ve been sitting at home for two years and I’m going to do it now.

O’Neill: Are the bookings actually happening, for 2022? Because you don’t have some source markets, maybe Russia is not having travelers in Europe this year. Maybe China is not doing it. Germany’s economy might be struggling a little bit more than was expected. How are bookings and the forecast for this year?

Böhler: From a TTC perspective, our biggest source markets are all to English speaking countries. And thankfully, obviously that the Americans can’t wait to travel and they are traveling. And they were the first ones to start traveling again in 2021. And Australia’s borders are finally open again. So those are really our key big source markets. So yes, people are booking.

Obviously Eastern Europe, not a surprise, is not really trending right now. But looking at Western Europe, Italy, Spain, France, Portugal, UK, Iceland, are all doing really well. And we also know that we ran hundreds of trips last year. We know we’ve moved from the theoretical travel will come back. Actually travel has come back and we can actually operate really well in this new world where our guests have amazing experiences with us taking all of the complexity out of it. And we’ve obviously had a ton of social media from the trips that we ran last year and it’s given the consumers further confidence.

O’Neill: OK. We have a question from Rue. How do you design for experiences for a group of diverse users, for example, those with disabilities?

Böhler: Great question. Not an easy one to answer. Obviously we try to cater for absolutely diverse users, but there are certain destination complexities, think of Venice. If you are a wheelchair user and are traveling Venice, it is not going to be easy. But at the same time, if somebody with special needs talks to us in advance, we can help and guide them on which of our many trips might be more suitable for them and advise them. And we would obviously request accessible rooms and all the rest of it. But especially traveling in Europe, all of our cities are centuries old and cobble stone stairs, and it is not easy. But again, having open communication, talking to us ahead of time obviously allows us to facilitate that and to give advice on what is the art of the possible?

O’Neill: OK. Another audience question about what the impact of virtual reality experiences may have on the tour operator sector. So there’s two ways of thinking of this. One is that customers might want to use VR as a way to explore what kind of tour offerings there are out there. But on the other hand, it is a competition, real world versus virtual. So how does TTC look at it?

Böhler: I think if we look back at the last two years, we were all forced to be stuck in this virtual world. And I think we can all relate to how wonderful is it to actually be at an in-person event. I was saying to you earlier, I haven’t been back to London in two years. I had my first in-person meetings with a number of London team members yesterday. And of course we’ve spoken hundreds of times over Teams. It is not the same thing. So I think we are all starved for that human connection. And in all honesty, I really feel that the virtual reality, yes, it is an important part, but it cannot make up for that real human connection, the smell, the sense, the taste of actually being in the destination.

O’Neill: So Travis, I was wondering a bit, there has been a lot of money pouring into the multi-day sector. You mentioned with the private tours product, that overlaps with things that Tourlane is offering, Evaneos is offering. We’re going to hear later today from Get Your Guide, which focuses on single day experiences. And we heard earlier from Expedia and Booking. How do you see other players and competition coming into the multi-day space?

Pittman: Yeah, I think there’s quite a few players coming in, but staying in fairly distinct swimming lanes basically. So if you look at Get Your Guide and Klook and Viator, they’re all battling it out for that in-destination attraction activities. So two, three hour type experiences. And there’s a lot of money being pumped in there. So they’re all very cut throat in terms of that competition. So I think it’s very challenging for them to be able to look sideways and actually look at other verticals.

And then if you talk about the likes of Tourlane and Evaneos, they’re very much focused around the tailor made experience. So all the stuff that the likes of TTC and G Adventures and Intrepid and all these companies are selling these schedule itineraries. Basically, no one’s really touching that. And we’ve been the only one really leading that. And I think that combination that we tried to build during the pandemic of offering tailor made and private as well as the group and scheduled is where we think the sweet spot is because a customer actually doesn’t care. Sometimes I want to do something with a group because I have no friends who want to go with me. I just want to travel. I want to get out. And then other times I want to do it with my family or with a group of friends. And they should have one place that they can go and actually do that.

So we see a bit of competition coming in, but we don’t see anyone coming into the way that we’ve approached it. And with our API and how we’ve tried to make it so accessible for other players, we want to have conversations with the Get Your Guides, the Klooks, the Viators of the world, to say why don’t you do a multi-day through us? And then they can actually package it up how they like. But all that contracting, all those commercials, it’s very difficult, takes a lot of effort to do that.

O’Neill: And your system allows a provider to decide I want to have this commercial relationship with this channel and these terms with this other channel as you’re toggling through?

Pittman: Exactly.

O’Neill: So, Ulla, we heard from my colleague Wilder from Skift research earlier, was talking about one of his points was sustainability. And a lot of consumers are not yet spending on it, but there is a strong preference for it. TTC has a commitment on sustainability. I know it’s been for a couple of years, what is new in your sustainability efforts?

Böhler: So as you said, for us this isn’t the new buzzword. We founded our TreadRight Foundation over 15 years ago. So we are very strong believers in it. But during the pandemic, we actually doubled down on our sustainability efforts and launched our five year how we tread right sustainability strategy. And it is publicly available on ttc.com. It’s got 11 very distinct goals. We’ve set ourselves as an organization, to give you one example, one of the goals is to be carbon neutral by 2030 across all of our TTC brands. Another one that is very close to my heart is our commitment of having at least one make travel matter experience on 50 percent of all of TTCs itineraries by 2025.

O’Neill: What kind of experience, the make travel better experience?

Böhler: Make travel matter experience. And essentially it is an immersive experience that supports the local community in very simplistic terms. But we use an assessment tool, which has been validated by external sustainability professionals. But just to bring it to life a little bit, picture yourself in the south of Spain in Seville, the city of flamenco. You obviously want to experience flamenco. We wouldn’t just take you to a regular flamenco show. We actually visit a local flamenco foundation. The Christina Herren Foundation, it’s a flamenco school. Our guests get to meet some of the students. They have a bit of a flamenco dance class if they wish. If they don’t want to participate, they sit down and watch it. And after that, they take their front row seats to a performance. It’s a very small, intimate venue. It’s not a touristy venue at all, but it is a very deep and rich experience. And we are supporting the local foundation who’s keeping the traditional alive.

And I think that is just one of the examples of the win wins we can create because our guests will have a deeper and more meaningful experience. We are supporting the local foundation. And at the end of the day, it’s a win for the company as well. So that’s really the 360 degree view we’d like to take and how we do believe the travel can and needs to be a force for good and support the local communities.

O’Neill: That’s a wonderful point to end on. Thank you, Ulla. Thank you, Travis, very much for joining us. Appreciate it.