Amid the experience sector's digital transformation, a notable trend is emerging: the importance of Direct Bookings, with smaller Tour operators looking to capitalize on the next wave for experience travel businesses.

While leading online travel agencies (OTAs) are keen to expand their digital footprint in a market where only 30% of bookings occur online, a growing preference for authentic, immersive experiences is reshaping how tours and activities are discovered, booked, and distributed.

Skift interviewed intermediary businesses, including management software solutions and business-to-business marketplaces, to get the inside track on these latest trends.

1. Google Things To Do Disruption

Lasse Kjær, founder of Holdbar, which offers management systems software for experience businesses, called Google's Things To Do an "interesting disruptor", offering tour operators direct traffic opportunities. "It changes the way bookings flow to the end provider of the experience," said Kjær, calling it a leveling of the playing field for smaller providers by reducing dependency on OTAs.

Google's Things To Do tool introduced a display update in July that makes the unpaid search and discovery of tours and activities easier, and it could be an important driver of direct bookings in the experiences market.

Skift Research's recent analysis of 40 cities on Things To Do showed that the direct sites of tour operators consistently appeared as top options for attractions, followed by major online travel agencies like Viator and GetYourGuide.

Craig Everett, CEO of Holibob, a travel tech platform that facilitates the distribution and selling of experiences online for tour and activity providers, travel brands, and tourism boards, said the cost of listing with OTAs was substantial, compared to operators owning their own direct booking process and optimizing their digital presence for organic search and display on Google Things To Do.

He used a hypothetical example for a walking tour operator in New York that runs 10 tours every day, each for 30 people, with tickets priced at $40.

That's $1,200 a day or $84,000 a week. However – if 90% of their bookings come through OTAs at a commission of 30%, operators are paying over $22,000 to the OTAs a week, compared to no commission cost for organic display on Google Things To Do. Focusing on direct bookings and investing $100K in site optimization and digital marketing could increase direct bookings by 25%, Everett said.

"While many operators excel in their specific niches, they often lack a strong digital strategy," added Kjær, who has helped 2,000 small and medium tour operators build their business through his decade-long venture TrueStory, which he recently exited. "This leads to an over-reliance on OTAs and a missed opportunity to build direct customer relationships," he said.

2. Niche Data: Mapping the Guest's Journey

Operators in the experiences sector are increasingly recognizing the importance of data ownership. Kjær suggested that commissions paid to OTAs can be a worthwhile investment if it lead to collecting data from satisfied guests who promote and refer more clients to the business.

"If your digital foundation is bad, and you don't fetch that organic traction to your business, then the OTAs will get it, again and again," Kjær cautioned, suggesting that it doesn't have to be an either-or scenario of building your own website and systems to boost customer loyalty through personalization and data-centric engagements – instead of listing only with OTAs.

Understanding the guest's needs can help operators choose when to list with OTAs and how best to grow direct bookings through a loyal customer base. Mapping the guest journey means tracking a customer's experience from start to finish to find the best times and ways to interact with them. Examples would be:

• Discovery: Place ads when people are searching for tours.
• Booking: Send a confirmation with add-ons.
• Pre-Trip: Email packing tips a week before.
• Post-Trip: Send a thank-you with a future discount.

While OTAs give global reach, Kjær said local operators should tap into existing guests with a more direct connection. He used gift cards as an example. "If you're good at creating great experiences, of course, those guests want to give that experience to somebody else," he said stating that it was important to set up processes where guests share this first-hand information and referrals with the business.

Hotels and Experiences: Targeted 3rd-Party Opportunities

Matija Marijan, Turneo co-founder and CEO, said hotels present a unique and targeted distribution channel for travel experiences. Turneo works with hotels and resorts to improve the guest experience by directly connecting tailored tours and activities to the hotel's websites.

This benefits destination-specific tour operators by giving them a niche channel to showcase and sell their activities. While commission rates are the primary source of revenue for OTAs, hotels are looking to experiences as a value-add and, therefore, charge lower commissions.

Turneo recently onboarded 50 of 52 local experience partners of a Croatian hotel chain Aminess, such as Sunset boat tours and a Taste of Istra wine tasting.

"Many of them are small family businesses that are unique to the destinations," Marijan explained, "Digitizing through hotel partnerships legitimized small experience providers, standardized their business practices, and helped them gain immediate demand."

Experiences from other hotels Turneo has worked with include a La Dolce Vita tour, Olive oil tasting, and a Gourmet experience in San Tomasso.

"You need to have a price. You need to have a structure. People will give a review, and the review needs to be based on the actual thing that's booked," said Marijan concerning the challenges of offline fragmentation. He added that onboarding smaller operators in this way benefits hotels with an "enhanced guest commitment and reduced cancellations." He said hotels offering unique experiences also see surprising extensions in booking windows.

Customers are making reservations for activities up to nine or ten months in advance, according to Marijan who cited an example like Truffle Hunting in Tuscany, extending a hotel's traditional appeal beyond just a bed for the night.

The Nordic Choice Group in Scandinavia, now rebranded as Strawberry, is another example of accommodations shifting to providing complete packages that include experiences, added Kjær, "I think it's really interesting when the hotel groups start thinking more about it, instead of just Booking.com."

Holibob's Everett said that with travel companies moving into other travel products further along the value chain like experiences, which he called "horizontalization," brands can "tap into a rapidly growing new source of revenue, with minimal lift. All while delighting travelers, generating customer loyalty, and driving up customer lifetime value."