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Why hoteliers should be offering local tours and activities?

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Why hoteliers should be offering local tours and activities?



Last week Sabre acquired Techsembly, an automated online retailing platform hotels can use to sell on- and off-property experiences and other add-ons.

Local tours and activities are the last travel sector to embrace online distribution. In spite of all the industry buzz and its huge potential, less than 15% of local tours and activities are bookable online, some experts even claim this figure to be 10%. Why is that? There are two main reasons: the highly fragmented nature of this sector and historic travel consumer preferences.

The local tours and activities sector is greatly fragmented, consisting of millions of small, independently owned operators. This explains the lack of businesses offering bookings online. They simply do not have the resources available for building any meaningful online presence and invest in mobile-first website technology, digital marketing, online booking systems, CRM technology, etc.

In the past, travel consumers have not been fully convinced that booking tours and activities in advance would bring any value in the form of better choice, better service, unique offerings, meaningful savings, etc. Over the last few years this is changing fast. With overtourism roaring back to most of the popular destinations around the world, travelers are smartening up. After booking their flights and accommodations, they are now pre-booking their local experiences, since they are afraid the best local tours and activities would be sold out and not available to book in-destination.

The commoditization of the hotel product, in which hotels are forced to compete with the OTAs strictly based on rate, leaves the hotel little opportunity to communicate the value of the hotel product to potential guests. To combat this and “sell on value” as opposed to “sell on rate,” hoteliers need an effective merchandising strategy, including offering a vast range of local experiences as part of the property website offerings.

Travelers are fully onboard: one study saw 98% of respondents say having “local experiences” in a new city was important.

The direct online channel offers limitless opportunities for the hotelier to present the hotel as the “hero of the destination” and the perfect choice to stay while exploring all the destination has to offer such as museums, galleries, family attractions, shopping, dining, nightlife, entertainment and more.

Combine this with a strong website merchandising program, focused on the uniqueness of the hotel product and its value proposition, and you have a successful strategy!

Hotels are local businesses, and this is a major advantage over the OTAs when selecting and contracting local tour and activity operators, monitoring their performance and customer service and ensuring timely payments.

Max Starkov
NYU

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