A brand new report from EyeforTravel finds that growth in the segment is inevitable for travel brands that put mobile first

Rapid growth in tours and activities has the travel industry sitting up and taking note, finds EyeforTravel’s latest industry report  – The Changing Face of Tours and Activities.

By some estimates, revenue from the segment totalled $40 billion in Europe alone in 2016. Going forward, however, EyeforTravel foresees a global market worth at least $200 billion a year. These growth projections are backed up by the forecasts of the companies interviewed for this report, which expect growth to range from between 9% and 30%.

At the lower end of growth projections is GTA, a provider of travel services and products to the travel industry. It is seeing spend of €150 per booking on tours and activities although this can be as much as €1,000 for multiday tours. TourRadar, a dedicated site for booking tours, which is forecasting 30% growth, says it is seeing travellers forking out anything between $1,500-$2,000 for a tour.

Typically, many tours and activities (which encompass a fairly broad range of things that travellers can do) have been booked in destination. But technology, in particular, and the rise of websites like TourRadar and GetyourGuide is changing all that. Indicating a shift in customer behaviour, Rezdy, a provider of online booking software to tour operators, says today nearly 40% of all tours and activities are booked online. Worth noting, however, is that there is still a last-minute aspect to this with the majority of online travel agent (OTA) bookers signing up for tours and activities in the last minute (usually 48 hours before departure).

Having said that, the report finds that there is still a propensity to book in destination, even in some digitally advanced markets. In Germany and the UK, for example, 53% and 45.8% of travellers respectively still booked in destination.

In destination is is where the opportunity lies. “Today’s traveller is all about mobile. The mobile phone is the number one item that people take on holiday, with millennials likely to touch their smartphone more than 40 times a day,” the report states.

Travellers today are also in search of adventure and tours and activities, “once considered a bolt-on sale are now becoming the main reason for travel.”

Since TripAdvisor finds that 67% of travellers use mobile devices to research what to do in destination, this is as GetyourGuide CEO Johannes Reck put it “a phenomenal shift”.

It’s also a huge opportunity, but understanding booking habits and behaviour – such as the growing propensity to rely on reviews, the influence of social media and payment trends – will be crucial to success in this competitive market.

The report is free to download. Aside from focusing on the size of the market other insights that include:

• Technical challenges incorporating tours and activities into a digital travel product

• New start-ups and disruptors

• How OTAs, hotels and airlines are including tours and activities

• Technology and how it is shaping the future of this market