The potential of tours and activities in the travel industry will have the capacity to move 183 billion dollars in 2020, according to research from the sector.
This amount represents a great opportunity for many actors: B2B technology suppliers, B2C distributors, wholesalers, aggregators, companies that offer tours or accommodation activities, investors… and more..
This assessment was published in a July 2017 report in Phocuswright, Tours & Activities Come of Age. Using that phrase as a starting point, the sector, without a doubt, is embracing this enthusiasm trend, but it is still on track to reach maturity.
Mobile phones in the foreground
Like all sectors in travel, a deep understanding of mobile technology is essential for tour and activity suppliers. This technology, like the tours and activities sector, is consolidated but in constant evolution, with much room for growth ahead.
With more than 50% of global Internet traffic coming from mobile devices (April data), it is obvious that these tour and activity suppliers must implement a mobile strategy. Understanding the specific trends of the use of mobile devices in tours and excursions can make the difference between having a mobile-friendly site or one that is truly optimized for mobile devices. (Differences between mobile-friendly and mobile-optimised)
The knowledge of mobile trends in other travel segments and in e-commerce in general, also adds up.
In the last three years, the bookings via mobile device have grown by 49% and those made through a desktop computer, have decreased by 10%. The data shows that, in 2017, mobile bookings represented 44.3% of total bookings. If tablets are included as mobile devices -the boundary between a large smartphone and a small tablet is more than diffuse- then mobile percentage breaks the 50% barrier.
In view of this upward trend, it is clear that the mobile, in its broadest sense, should be the central pillar of the multichannel approach of a tour and activity supplier.
Tours and activities do not exist in isolation, they are part of a travel experience that usually includes the acquisition of other products such as a plane trip, train, car rental, accommodation… Mobile bookings are increasing in all these types of products. Travelers who book their flight on their mobile or check-in at their hotel using a smart key will expect their tour and activity supplier to offer the same mobile experience as well.
Moving ahead of your bookings
Some components of the trip should generally be booked in advance, not only to ensure the best price, but also, as in the case of flights, a seat on the specific dates of departure and return. Accommodation is less limited in terms of capacity, but many travelers prefer to have it planned in advance.
In the case of airlines, hotels and external distributors, the advance sale is imperative to help visibility, cash flow and yield management processes. In recent years, airlines and OTA have raised the stakes in this area by adding messages of “shortage of seats” in their booking channels, along the same lines as “Only three seats left at this price” or “26 people are looking at this page now”, all designed to make people book immediately.
For tours and activities, the mentality is different. The data shows that one out of every four bookings is made on the same day that the activity is consumed. This tendency towards in-destination booking is due to many factors, but the dominant one is the most obvious: people use their mobile phone when they are away.
In the early days of mobile phones, travelers were reluctant to use them due to concerns about the cost, especially on trips abroad. Network operators now offer data plans that include international roaming at a reasonable price or even for free. And travelers who do not have data can easily find Wi-Fi hotspots in coffee shops, hotel lobbies and department stores, to fulfill the same purpose.
Another change in the mobile landscape is the willingness of consumers to make transactions using their device. It is vital that tour and activity suppliers ensure that your mobile site accepts payments transparently and securely. A website optimized for mobile devices with a poor payment process is not friendly at all.
As we can see in the graph, most bookings for tours and activities are made the week before departure. From there, booking fees are reduced week by week.
There are many factors that contribute to make this time frame of the week before the departure dominant: leisure travelers in particular begin to prepare for their imminent journey, talk with their friends, think about packing, buy essential last-minute items. Booking a tour in advance solidifies the anticipation and reduces flexibility when improvising the trip on the fly.
For tour suppliers, this narrow advance booking window is nevertheless ample time to prepare and ensure that the experience is memorable for the customer. It can also enable a company with a suitable CRM platform to interact with the traveler in advance, in order to forge a personalized relationship likely to result in a lifetime value with the customer. Opportunities for increased sales and cross-selling may also arise if the products offered are relevant.
The research pointed out that conversion rates on mobile devices are higher than desktop rates. In 2017, 61.91% of mobile device users who started a booking followed up with their confirmation, compared to 45.33% of desktop users. These rates are slightly below 2016, reflecting an overall increase in traffic volumes.
The success of the conversion rate depends on many factors. There are reasons why mobile users are reluctant to convert: security concerns, inability to see product details, difficulty navigating the site, comparing the offer, and filling in the forms.
These concerns are relatively simple to deal with a site optimized for mobile devices. As mentioned above, if the mobile site does not show your product clearly enough, then it is not compatible with mobile devices.
Tours and activities have better conversion ratios on mobile devices than desktop computers because users are often closer in time to the purchase decision. Mobile sessions are shorter than computer sessions, suggesting that mobile users enter, find a tour or activity and book it, showing a more functional approach than desktop users, who spend more time in the consideration phase.
It is also observed that mobile users visit fewer pages than their desktop colleagues, confirming this more pragmatic approach.
The other side of this functional attitude is that mobile device users have less patience, they do not click on a site if it does not work according to their expectations. The bounce rate on mobile devices is higher than that of the desktop.
Having a website optimized for mobile devices (Web with Responsive content) should no longer be a project at the bottom of the drawer. Tour and activity operators should take a mobility approach or risk losing half of their online customers. Here are some tips to optimize the mobile booking experience::
- Eliminate all distractions and lead visitors to make a booking with clear calls-to-action
- Provide search by date for your products
- Minimize form fields and offer autocomplete options
- Secure refunds to help visitors overcome anxiety about booking on mobile devices
- Provide assistance easily through instant messages or click-to-call buttons