When online tour search and booking site TourRadar picked up
$6 million in funding in May, it marked more than just a victory for another
start-up. The Austrian company has gained momentum in a space that has eluded
the tour-operator sector until now: a proper online tour-search tool, with
customer reviews and a booking marketplace.
“For us, we see this as a positive sign for the growth of
adventure travel and the tour industry as whole,” said Leigh Barnes, director
of Intrepid Travel North America, one of the larger operators that sell
inventory on TourRadar. “At the end of the day, it’s a new channel that will be
good for the industry.”
TourRadar launched in 2010 as an Australian company focused
on lead generation. In 2013, the company moved its headquarters to Vienna,
picked up its first round of investments and pivoted into a transactional
booking-engine model. The company also created an app five years ago that
enabled people to meet online before a tour began. The app became very popular
and helped TourRadar make its name.
Travis Pittman, CEO of TourRadar and co-founder with his
brother, CFO Shawn Pittman, said that it wasn’t easy to get tour operators
onboard at first. The brothers hit the travel trade-show circuit to
make their pitch to all tour operators.
“Slowly but surely, as we started to prove ourselves, they
started to take more notice and care about what we were doing,” Travis Pittman
said.
TourRadar now sells more than 500 packaged tour brands,
including G Adventures, the Globus family of brands, Intrepid Travel,
Trafalgar, Insight Vacations and Contiki. The site features more than 20,000
tours in about 200 countries, ranging from youth and adventure tours to luxury
escorted ones. And unlike many of its predecessors that essentially operate as
tour discounters, TourRadar has price parity with operators and only runs
occasional sales and promotions, according to Pittman.
One of the site’s main draws, for both consumers and tour
operators, is that it offers some 50,000 consumer reviews. Tour operators have
struggled to claim an online space where consumers could go for comprehensive
tour reviews. The biggest player in the travel review arena, TripAdvisor, has
declined to create a specific category for tours and tour operators.
“We’re a bit like TripAdvisor in a way but for the multiday
tour industry,” Pittman said. “Anyone can go to TourRadar and leave a review
about Trafalgar or Contiki. We want to be that authority in the industry, where
if someone is thinking of doing a tour, they can come to TourRadar and find
reviews about those particular trips.”
While larger tour brands give TourRadar credibility, Pittman
acknowledged that helping consumers sift through and work with smaller,
lesser-known operators provides just as valuable a service, if not more so.
When travelers work directly with smaller operators, he said, it can be risky —
such as wiring someone in Tanzania $5,000 and hoping they show up at the
airport.
Instead, he said he hopes that TourRadar can serve as an
“Airbnb-style platform” between the consumer and the ground operator, ensuring
that the operator “is legit, he’s going to show,” Pittman said.
For travel sellers, seeing a company such as TourRadar
gaining traction might seem like a potential threat to their business. TourRadar
is ultimately providing consumers with information and tools to make tour
bookings on their own, and tours have remained one space where travel agents
still hold some sway due to the fact that the bookings are often complex and
that there hasn’t been a good place for consumers to do it themselves online.
And tour operators still offer some of the most lucrative
commissions in the travel industry.
But TourRadar and the operators it works with insist that
the travel trade shouldn’t feel threatened.
Paul Wiseman, president of Trafalgar, said, “I do not know
of any product purchase that does not begin or involve the internet today, so
embracing that as one potential way to have your travel agency services
displayed to customers is vital. We view the internet as the window through
which everyone will look to shop, and each agency should clearly identify why
the customer should shop with them. All our travel agent partners are
consumer-facing, so we do not see any difference.”
In fact, TourRadar sees travel agents as potential partners.
The company has signed an agreement with Amadeus in the Asia Pacific, and once
the integration is complete (Pittman said it has been a slow process), agents
in the Asia Pacific region with access to the Amadeus GDS interface will be
able to search and book tours on TourRadar at no additional cost to the agents.
“If it works, we’ll roll it out globally,” Pittman said,
adding that TourRadar is also in talks with other GDSs.
“I don’t think travel agents should really be too worried,”
he said. “I think the bulk of people who still book tours through travel agents
will continue to do that. … We are definitely not going out there to just
squash travel agents.”
As for the argument that tours are too complicated for
travelers to properly book on their own and require lots of customer service
throughout the process, TourRadar is hoping to offset a fair amount of the
customer service burden by providing ample information on its site that would
answer many of the questions and concerns travelers might have. For example,
there’s an extensive FAQ section about all the tours, customer reviews and
photos. And if customers still have questions, TourRadar has a team of agents
manning the phones.