Why Offering Local Tours and Activities is a Huge Revenue Opportunity for Hotels
Offering local tours and activities - i.e. experiences in the destination - is a multibillion dollar business, with the OTAs having shown a growing interest in this sector. Expedia alone is looking to grow its local tours and activities sales fivefold - from approximately $400 million a year to over $2 billion. Expedia currently has 4,000 suppliers providing 27,000 tours and activities worldwide. Airbnb, through its Experiences offering, has been rolling out tours and activities in many of its key destinations with the goal of bringing its offerings to 1,000 cities. Recently, Booking.com acquired Fairharbor.com and TripAdvisor acquired Bokun.com, both cloud-based software platforms that enable local tour and activities operators to make their services bookable online.
Yet, in spite of all the industry buzz and its huge potential, less than 20% of local tours and activities are bookable online. Why is that? There are two main reasons: the highly fragmented nature of this sector and travel consumer preferences.
Source: Hospitality Net