A recent report by Skift Research estimates that the global tours and activities market is worth approx. $150 billion annually and yet it is still considered to be the great untapped market in online travel due to the global fragmentation of the industry.

This recent growth has primarily been fuelled by the rising importance of 'the experience', with travellers increasingly widening their horizons and opting for new non-traditional, experiential breaks.  The way that tours are packaged now reflects the demands of consumers and challenges the very definition of what a tour is.  Consumers want more immersive, authentic and unique experiences, with opportunities to absorb the culture of a destination.  And it's not limited to a specific demographic either, with baby boomers and millennials both exhibiting similar trends.  

Tours and activities tend to be the last element booked for a holiday, with 35% of travellers using a mobile to book a tour or experience in-destination and TripAdvisor accounting for just over half of the bookings made.  Data from Skift Research shows that:

  • more affluent travellers (67%) prioritise tours and activities over a hotel room when it comes to spend (compared to 59% in 2017)
  • 54% have participated in an adventure experience at least once
  • relaxation is still important but 67% say that experiencing new things is more important

TripAdvisor's research data for 2017 demonstrates some interesting trends for tours too:

  • iconic landmarks and sites are the most popular
  • historical and heritage tours jumped 125 percent in popularity in 2017 for global travellers
  • sunset cruises increased by 86 percent 
  • private day tours were up 79 percent
  • food experiences were the fastest growing category in terms of traveller spend; spending was up 61 percent in 2017, with travellers from Canada, the UK, and Australia leading the way
  • travellers are increasingly avoiding queues with 'skip the line access' appearing in the most popular and fastest growing lists for global travellers
  • 30,000 new experiences were added to TripAdvisor last year, equating to a 50% increase

The majority of tours currently available are geared towards large groups, mainly offered by global brands, some working in partnership with DMOs and local travel operators.  The vast majority (around 80%) of bookings still take place off-line in destination, through traditional tour operators or through travel agents.  Only 13% of bookings happen with real-time connectivity.

The current situation has been compared to the challenges that the hotel sector faced before booking.com when a disparate market of independent and boutique hotels became connected and bookable online.  One day travellers will be able to book global tours online, joining up destinations around the world.

Airbnb has made a huge impact on the tours and activities space in the last decade, launching its experience booking platform initially in 55 cities in 2016 and expecting to extend to 1000 cities by the end of 2018.

So how are New Mind | tellUs destinations taking advantage?

Many of our destinations are also experiencing a growing interest in tours and experiences and are increasingly regarding them as a key source of booking income.  Our Itinerary Builder functionality continues to be a key element of our visitor sites but some of our clients are complementing this by creating inspiration via their own themed tour suggestions and itineraries.  

Earlier in the year we covered the popularity of Fjord Norway's Tour Suggestions page, prompting the introduction of banner ads and the generation of a new revenue stream for the DMO.  Fjord Norway's tours include spectacular road trips and its '10 Norwegian Scenic Routes' has proved particularly popular, inviting visitors to experience local food in villages along the routes and hike or bike in the mountains along the way.  Coastal expeditions, family adventures, romantic culinary trips and journeys in the footsteps of the Vikings are also popular on the Tours Suggestions page.  Sophisticated search facilities help visitors to refine their choices to a specific starting point, season, type, duration and mode of transport. 

Also in Norway, VisitBergen has experienced an incredible growth in their activity and experiences booking, with an increase of 30% between 2016 to 2017 and 40% between 2017 and 2018. Similarly, Visit Svalbard is another example, achieving a 40% increase this year.   

Another New Mind | tellUs DMO, Visit Nottinghamshire is helping visitors to explore the destination with themed itineraries promoting the area's fascinating history, culture and attractions.  Themes include Weekend Itinerary on a Budget, a Literary Itinerary and a Robin Hood Itinerary inviting visitors to get to know the man and the legend.

The Visit Manchester marketing team has also invested some time on the creation of a great selection of itineraries to suit all interests including music, sport, culture and shopping.   Visit Isle of Man's sample itineraries cover various themes and lengths of stay to help visitors to explore the whole Island, taking in family activities, heritage, wildlife and food and drink along the way.  

More options and increased differentiation has changed the perception of tours from the original staid idea and users now expect unique experiences which can be personalised and customised and bookable online.  It will be interesting to see how the sector develops...

To talk to us about your ideas for tours and experiences and to find out how we have helped our clients to exploit their potenial, contact your Account Manager.

The full reports from Skift Research and TripAdvisor can be read at the links below: 

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