One of the fun things about building this business & the tours has been learning about a whole new industry: how it works; the terminology; the business side of it. And what I’ve quickly learned is that one major part of the business side is especially terrible for a small, new DC food tour business like mine.
I posted on my socials yesteday about all the profile listings I now have up for my Drink•Eat•Walk tours:
- Tripadvisor → https://drinkeatwalk.com/tripadvisor
- Viator → https://drinkeatwalk.com/viator
- Get Your Guide → https://drinkeatwalk.com/getyourguide
These sites are called Online Travel Agencies (OTAs), and it’s how small, new tour businesses like mine get customers early on. Howver, like any travel agency, there’s a cost. I’m the supplier, though, so that cost is borne by me, and it’s steep.
Ex: The baseline cost to me for all tours booked via Tripadvisor/Viator is 26.7% of the purchase price. So, for a $149 tour, that means ~$40 is immediately swallowed by them. Get Your Guide isn’t much better, at 25%.
It gets worse. That high cost % doesn’t even ensure my tours will be seen. If I want my listing to appear on the site in search results or category pages, I have to increase that % into the 30 to 35% range.
I mean, I don’t have to, but all my competitors do, so if I don’t, I’ll never get seen. Plus, any company can choose to pay even more to have their competitors’ listings not even shown adjacent to theirs.
If you think of the OTA not just as a travel agent, but also as a marketing & logisitics expense, and review aggregator, their fees become a tad easier to swallow. That doesn’t mean the finances get any better, though.
It’s become clear already that getting a booking via an OTA is just about getting tour cycles in to improve the product, build the brand, get the word out, increase SEO, and gather reviews. It’s not about making money.
The only way to make real money for one-person tour shop like mine is via direct bookings on my site, and private, custom tours.
You: “Tim, why don’t you just raise your prices?”
Tim: “I already have to charge $149 — would you pay $199 or more?”
I’m not totally ignorant here — I did my research and absolutely knew all of this going in. I signed up for the challenge, am not afraid of it, and am thoroughly enjoying it.
I just wish having a few beers with my guests on a food tour of DC didn’t also swallow all my profits for that tour 🍻😂
eyeintim 
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