This year was quite a doozy for the tour operator industry. Three operators — Thomas Cook, JG Worldwide and Cox & Kings, The Americas — folded, causing many to wonder if the closures were a coincidence or an industry trend.
Analysts have been quick to point out that these companies have gone out of business for the same reasons that companies in all industries fail. In general, they made bad business decisions, such as expanding too fast, not evolving with consumer preferences and competing on price.
Fortunately, travel advisors can take away some best practices from these mistakes. Following are a few lessons, as well as an update on the strong consumer preference for itinerary customization.
This year was quite a doozy for the tour operator industry. Three operators — Thomas Cook, JG Worldwide and Cox & Kings, The Americas — folded, causing many to wonder if the closures were a coincidence or an industry trend.
Analysts have been quick to point out that these companies have gone out of business for the same reasons that companies in all industries fail. In general, they made bad business decisions, such as expanding too fast, not evolving with consumer preferences and competing on price.
Fortunately, travel advisors can take away some best practices from these mistakes. Following are a few lessons, as well as an update on the strong consumer preference for itinerary customization.
Buddying Up With The Owner Is a Good Idea
After the collapse of JG Worldwide this year, Austin Adventures saw an influx of business from travel advisors booking national parks. Dan Austin, founder and CEO of Austin Adventures, tells agents burned by recent company collapses to “ask to speak to the owner, because owner involvement is key.” He also suggests grilling owners about how long they have been in business (longevity is essential) and how they handle complaints, refunds and insurance. These days, advisors can’t afford to skip doing their homework — from asking for referrals from fellow agents to even asking the owner for bank references.
Ask to speak to the owner, because owner involvement is key.
Boutique Operators Are Looking Better Than Ever
While it’s good business to know the owner, the bigger the operator, the less likely it is that advisors will be able to get to the top. Heather Christopher, owner of Heather Christopher Travels and co-founder of TravelPro Theory (TPT), a resource for travel professionals, is a big proponent of boutique operators. She says experienced advisors tend to prefer boutique because “they want their partner experience to match the client experience.”
This shift is the result of changing traveler expectations, says Kate Thomas, co-founder of TPT and owner of boutique operator North & Leisure.
“Clients want more unique, authentic and immersive experiences, and boutique suppliers tend to be a little quicker on their feet when it comes to incorporating new types of experiences, versus just sticking to the tried and true,” she said.
Custom Trips Are Niching Down
Custom itineraries were the No. 1 tour operator itinerary trend, according to the 2019 Adventure Tour Operator Snapshot Survey conducted by the Adventure Travel Trade Association (ATTA). While FIT operators can testify to the growth of this category, even scheduled group tours reflect this trend because operators focus on evolved offerings for nearly every niche.
Operators are creating increasingly niche tours, such as Exodus Travels’ Chernobyl itinerary.
Credit: 2019 Getty ImagesFor example, one new tour for 2020 is Exodus Travels’ Chernobyl & Kiev Long Weekend itinerary, which brings students of history (and, perhaps, fans of HBO's recent “Chernobyl” series) into Pripyat, Ukraine, to learn about the 1986 explosion. And consumer interest in “last-chance tourism,” “sustainable travel” and “remote locations” (the No. 2 trend, according to ATTA’s survey) mesh in Natural Habitat Adventures’ new Discover Greenland trip, which includes a stay at an exclusive lodge in a lesser-traveled part of Greenland, from which travelers can experience a glacier-filled landscape all to themselves.
