Ever since TripAdvisor bought Viator for a clean $200m, rumors have abounded all over the place about what they would do with it. Now we know:
Viator is opening their platform to any tour operator who wants to apply.
This is pretty big news! For the longest time, Viator has had a semi-closed platform, meaning that you had to be hand-selected to get on there. While they did add many tour businesses, there were many more on top of those that wanted to get listed. Now you have the opportunity.
TripAdvisor and Viator are out to dominate tours and activities.
Talk to accommodation businesses, and they will all agree on one thing: giving up 10-20% on nearly all their bookings to companies like Booking.com, Hotels.com and the like is not pleasant. While taking that kind of haircut hurts, a part of that pain is not being able to control their acquisition channel.
When people can compare and book a hotel room side by side, it gets turned into a meat market with less opportunity to differentiate and basically zero chance to build a relationship. This is the future as Viator, under TripAdvisor’s ownership, sees it.
It makes sense. Barrie Seidenberg, CEO of Viator, shared this on Tnooz:
‘We view this marketplace effort as complimentary to our curation strategy. We’re not turning away from curation. Consumers like it when we handpick some suppliers and do a lot of merchandising, such as inclusion in our Viator Top Picks.
Having said that, we know customers want to explore lots of long-tail activities and places we haven’t previously serviced. So the self-serve model makes it possible as a practical matter to scale up and offer more comprehensive selection faster than we could otherwise.’
TripAdvisor’s push into bookings has been gradual but pronounced. There are two highly prominent booking buttons and one largely hidden website link. This is no accident. Understand that from now on, TripAdvisor is trying to minimize the amount of visitors it sends you to the greatest extent possible.
While they probably won’t really remove that website link (or else, explode the internet), don’t ever think that your position in TripAdvisor is safe (I’ve talked about this before).
What Does this Mean For Tour & Activity Operators?
This is one opinion from a comment left by an operator on Tnooz:
‘Speaking as a very small supplier, Viator’s 20% commission is a deal breaker. Until booking engines drop their rates to 10%, a large segment of the industry is not going to get onboard. There are enough alternative routes to publicizing a small tour business, and there always will be, and at 20%, there is powerful motivation to prefer these options.’
And then Olan, CEO of tour software company Acteavo.com, emailed to share this with me:
‘TripAdvisor wants to give customers a book now button from all their listings and opening up Viator is their route to doing that. We all know that TripAdvisor listings are important. Having a “Book Now” button on your listing should increase conversion.’
The biggest advantage, however? Olan again:
‘Besides the obvious such as increased eyeballs, you have access to Viator partners such Airlines, Hotels, Car Rental, and Online Travel Agents.’
This is something I personally expect to explode. It’s very rare after booking a hotel room for them to offer you a tour to book at the same time. I’d be shocked if we don’t see Viator and other competitors pushing into this space, as it’s a no-brainer for everyone involved.
Olan mentioned several disadvantages to me, though, including the fact that for no amount of money will TripAdvisor let you send that booking button to your own website.
Should You List on Viator?
First, surely it’s worth the experiment.
Business is really just a series of rapid experiments with expansions on the successful outcomes.
It’s a tough one to think about, though. Will the additional sales on Viator offset the lost margins from sending visitors to their site instead of your own?
It seems to me that the most obvious play here is for the businesses who can fill additional capacity without having to hire additional staff — zipLine or hop-on hop-off bus companies, for example.
Any younger businesses looking to build momentum would also be well-placed to use this kind of thing.
Beyond that, are you tracking your TripAdvisor sales carefully? To run this experiment, the maths is relatively simple. Statistically it could be a bit tougher, as who knows whether that dip in TripAdvisor-related sales can be explained by the uptick in Viator sales? Don’t forget, Viator has a multitude of marketing channels, not just TripAdvisor.
If you have any thoughts or opinions on this let me know at email@example.com.
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