New Ottawa-based startup Tourdigger.com, a B2C aggregator of tours and activities in about a thousand cities worldwide, is off to a strong start.
Since its July 2013 launch, 752 tour operators have posted listings on the platform, including brands like G Adventures and Intrepid Travel. More than 50 independent guides are listing tours, too.
As of today, the company has 5,606 tours and activities, from day tours to multi-day expeditions (that sometimes includes lodging).
Part of its appeal may lie in its having a booking model that differs from the common industry approach.
It attempts to put the tour operator in front of the transactions by connecting the operators directly with the customers. For this reason, it does not require credit terms like most OTAs. (See answers, below.)
TourDigger describes itself as an open platform, similar to GetYourGuide. Tour operators join risk-free to plug into a full-market platform. Any (vetted) tour operator can list.
Unlike other platforms, it has an integrated private social network Tour Trackz — basically a Facebook clone only for its users.
TourDigger has created a cool Vine to illustrate its pitch.
Q&A with Brian Stoneman, founder and president.
Tell us how you founded the company, why and what made you decide to jump in and create the business.
I founded Toudigger.com as a collaboration between my partner and myself since at the time there was no standout providing credible tour reviews, TripAdvisor was not yet in the tours and activities picture.
Why? Anyone who enters the in-destination activities, segment (the “things to do” sector) is in some way looking to provide a unique and interesting experience to the traveler.
What seems to have been ignored to some extent are the incredibly valuable tour operators and guides who are responsible for imparting these experiences.
I jumped in to create something useful for travelers (of course) but to do so by creating something equally useful for tour operators, something they can really get behind in order to promote their products on their terms.
The idea/goal is the build the largest collection of Tours, Activities, Events, and Festivals that is out there (Events and Festivals not on board yet and won’t be for some time).
It’s about trying to find a way to connect Tour Operators with the clients and supporting their efforts in order to bring such an overwhelming variety that we can’t be ignored by Travelers
Tour operators recognize that our platform is well executed and easy to use, that it is low risk and perhaps that it brings them a little something extra currently missing in the promotional space.
Are you supplier direct? Do you act as the agent for transactions?
We are neither and THAT is where we are different.
According to Stephen Joyce there has been no innovation in the “model” for tours and activities for years.
Well, we have done something different — maybe not innovative, but different.
Because the traveler reserves with us and then pays the balance owing directly to the tour operator, there is no payment sent by us to tour operator for the submission of a “voucher”, the way is done with Viator & Company.
Instead there are two transactions: one to use to book, and the other to the tour operator, to finalize.
What’s TourDigger’s theme or niche?
Our niche? Well we are taking a step backwards, I guess. We are trying NOT to be pegged as day tour or multi-day, exclusively about twentysomethings, or another theme.
While others are specializing into categories, we are trying to broaden and house all types so that when people think tours, they come and search our site…
For example we have all City Sightseeing, Intrepid Urban Adventure and 30 Gray Line but also World Expeditions, GAdventures, Intrepid, and many others.
Size of the team, names of founders, management roles and key personnel?
Our team consists of mix of talented people brought to the project the need arises; developers, writers, graphic design, data management gurus, network optimization geeks and marketing specialists to name a few.
At any one time there are as many as 6 teams of independent contractors working on this.
Brian Stoneman (me) is the Founder and President while Andre Latreille remains involved as a co-investor and general sounding board.
Funding arrangements?
TourDigger is self funded but is very interested to take on a partner(s) to fund expansion plans as well as to further fund marketing, SEO/SEM/SMM/SMO efforts.
We also have expansion plans that will soon require capitalization. We need investors to ramp up this growth, it’s sitting right in front of us.
In the meantime, we also have VERY many tour operators who have multiple tour offerings but have only put up one or two give time constraints. We will “mine” our own operators in the next year and put their offerings up at our expense, to scale.
Estimation of market size?
Enormous by all accounts, though highly fragmented. As as near a we can tell this market is heating up and full of opportunity.
According to various studies cited on Tnooz and elsewhere the market for in-destination activities sector in the US and Europe combined is estimated to be about 20 billion annually for online bookings.
Competition?
There are many players, see the Ultimate guide to the specialist tour and in-destination activity market.
However, there appear to be only a handful of players who pay particular attention to tour operators.
Revenue model and strategy for profitability?
We work off of commissions as agreed to by each tour operator. We take these commission directly from the traveler as a reservation deposit. After the traveler secures their spot with us he/she pays the balance owing directly to the tour operator.
There are a number of benefits to the tour operators working this way.
Principally it benefits all concerned since we have reduced the transaction costs for transferring money and can offer more to our users by way of site innovations.
We are saving and the tour operator is saving since we are not paying banks and payment service providers to redirect money….they have enough money right?
We also sell direct advertising to operators, hock ad spots via Google, sell subscriptions and sell leads via our lesser subscription class. We are currently building a complimentary SMM/Comms application that will operate as a “software as a service”.
It will be directed to tour operators to help them punch a bit above their weight and later to a broader market.
We are also considering standardized travel tour WP themed websites and hosting as a value added service to tour operators who want to up their game a bit.
With a year or two we will be looking to broaden our reach by publishing our own white label api solution accompanied by a simple, yet effective TourDigger Android/iPhone App. This will in part depend on revenue and capitalization by investors.
Our overall strategy for profitability is simple, offer as much tour variety as possible and build an enormous, well appointed resource that people just can’t avoid.
We want to offer a world of tour options to travelers and do this by accommodating tour operators in a way that not only makes them feel like they are part of something great, but makes them want to help build it.
What problem does the business solve?
The tours and activities segment has two moving parts, the travelers who take tours and the tour operators who provide them. We are hoping to improve marketplace fragmentation/accessibility issues for tour operators.
We are convinced that this will have the knock on effect of providing greater variety, info and ease of access to travelers.
Tour operators will find greater accessibility in a tool that allows them to tailor their service offerings as they wish and travelers will realize better info and an easier way to readily connect with the experiences and things to do they are trying to find.
We also have plans in the works to help operators with their marketing. I have found that very many tour operators want to advertise or “get out there” but don’t have a lot of time for including secondary content into sites like Tourdigger.com.
We are finishing up a solution that will hopefully address that issue.
How did the initial idea evolve and were there changes/any pivots along the way in the early stages?
The idea started as a simple review site. We wanted to provide people with meaningful info that would help them to pick the best tours.
A great deal of thought has been incorporated into creating a process that provides specific and useful information. Our reviews are more than a selection of stars and the addition a bit of text.
The reviews are easily/quickly completed via sliders. These sliders focus on 26 core criteria that will aid both tour clients and tour operators.
As each review is added, the average tour scores are calculated and the tour rankings are updated in real time. We think we collect more information and summarize it better than others out there, reviews and rankings are more front and center than in other sites.
We also provide summary reports to our tour operators as part of our premium subscription. These reports detail the scores for each criteria and these criteria are updated as each new review is submitted.
Over time our reviews will prove to be an invaluable resource to tour operators who may want to tweak their services and travelers who simply want to sort the good, from the bad and the ugly.
The business evolved from a simple review site to:
• offer a full booking engine capable of accepting booking info from about 99% of tours on the market,
• offer corporate xml feed integration for larger partners via xml importers
• offer an incredible inventory, excellent searches/sort features and more
• offer social media marketing campaign/communication tools, which will allow tour operators to more easily meet their social engagement objectives
We are continually evolving as we refine our knowledge of the market, of new and interesting strategies for growth and as we realize better our own strengths and weaknesses.
Why should people or companies use the business?
Tour operators should use us because the platform is effectively risk free since we have done away with the “merchant of record” business model. What this means is that tour operators are not required to provide tours then wait for payment.
Brett Asbury, VP of Operations and Business Development at Gray Line Connect says,
“this is an improved way of doing business that substantially reduces risk to tour operators by dissolving credit terms normally required between OTAs and suppliers, it’s good to see this evolution within the industry.”
Travelers should use our platform because Tourdigger.com is shaping up to be a massive marketplace for tours and activities that will be difficult to avoid.
In addition, the platform is risk-free to tour participants since we are committed to provide a 100% deposit refund even after the tour has taken place. We are definitely taking a long view when it comes to client satisfaction.
Accessibility, service and value are not simple words on the page, they have been incorporated by design.
What is the strategy for raising awareness and the customer/user acquisition?
Build it right, build it well and make it easy to use and PPC, SEO, SEM, SMM, publicists, contests, affiliation, the usual suspects.
Of course we will be casting a net in our social pond as well as conducting research to ensure that we know what’s coming and where to invest our time.
We are looking to make strategic alliances with complementary startups and established business to broaden our knowledge base as well as our mutual customer base.
Where do you see the company in three years time and what specific challenges do you anticipate having to overcome?
It’s probably over-ambitious but we want to hold the greatest number of travel tours in one place hands down, day or multiday.
Once we have done that, we will finetune the site searches and sorting to ensure that they are even better to handle this type of variety. But the roots are already there.
Honestly, if success is a foregone conclusion and hopefully it will be, I envision Tourdigger.com branching out into emerging economies and markets to bring something that can lift people up.
I hope to help people who might encounter barriers to entry into the in-destination activities segment due to their challenging circumstances. Cambodia comes to mind.
By providing innovative opportunities to people in marginalized markets, our ultimate goal to help travelers find real meaning in the activities and experiences they choose by supporting people who can benefit the most.
We have to overcome all that challenges most startups like resources, time, direction, growth, capacity, etc.
What is wrong with the travel, tourism and hospitality industry that requires another startup to help it out?
In a recent article, A reality check on tours and activities (bubble?) Paul Bennett of Context Travel says, “Much of the world’s destinations are regulated by tour guiding laws, which tend to homogenize the travel experience and reduce it to the lowest common denominator”.
I could not agree more and it isn’t confined to “tour guides”.
Tour operators within the tours and activities sector suffer this burden as well. Institutionalized thinking seems entrenched as do protective business practices all keenly linked to the “agency” ethos. The result of this has been to limit or make less visible smaller amazing service providers.
Don’t misunderstand, travel agents work hard as hell and many are very good at what they do but there is definitely room for innovation. Technology provides many new avenues for exposure one simply has to look at AirBNB or Uber.
The industry is at an exciting time and it will be interesting to see what happens over the next 10 years.
The glass is half full, we see nothing “wrong” per se we see only the opportunity to be creative and apply innovation to enable/empower people.
What other technology company would you consider yourselves most closely aligned to in terms of culture and style… and why?
To be completely honest I am not sure. We haven’t been too concerned about what others are doing.
We offer a mix for both travelers and tour operators but culturally speaking I imagine we are somewhere between Viator and TourRadar.
Tnooz view:
Tours and activities, especially focusing on the same-day market, has officially caught fire as a category among investors lately.
This summer, TripAdvisor has acquired market leader Viator, while the other most-talked about platform, GetYourGuide, landed $25 million.
The list of other competitors in tours and activities is quite long.
We’d roughly put TourDigger.com in the top 10% in terms of technical and business savvy, along with companies like TourRadar and City Discovery plus solutions providers like Rezgo. It appears to be coming up with practical solutions to the chicken-and-egg problem of creating a marketplace.
But much depends on execution, especially on user acquisition.
Even then, only the top 5% may survive, so TourDigger will have to not only make good on its promises but exceed them over time. Embracing more innovation may be helpful.
We’re looking forward to seeing what’s next for this Canadian-based startup.
NB: TLabs Showcase is part of the wider TLabs project from Tnooz.
