Jon Cartu Publishes: FareHarbor responds to criticism from tours and activities ... - Jonathan Cartu - Advertisement & Marketing Agency.
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Jon Cartu Publishes: FareHarbor responds to criticism from tours and activities …

FareHarbor responds to criticism from tours and activities ...

Jon Cartu Publishes: FareHarbor responds to criticism from tours and activities …

There was tension in the air at the Arival conference in
Orlando last week as FareHarbor CEO Max Valverde took a seat on stage next to fellow
leaders of tour and activity reservation systems including Chris Atkin of Rezdy, Ruzwana
Bashir of Peek and Jason Morehouse from Checkfront.

In April 2018, Booking Holdings bought
FareHarbor
, boosting the profile and pocketbook of what had been just another
one of the more than 150 reservation system providers in this sector (according
to Arival research). 

At the time of the acquisition, FareHarbor said it had about
5,000 tour and activity providers using its software in the United States. Fast-forward 18 months and Valverde says that figure has doubled, with more
than 100,000 bookable activities on the platform, still primarily in the U.S.
but also in Europe, Australia and New Zealand. And the company has a staff of
more than 600 employees worldwide working to grow that business.

So Valverde says he was not surprised that the panel
discussion went as it did – with the spotlight largely on him and issues such as
data privacy, pricing and whether independent systems are better able to serve
the needs of operators than ones owned by distributors (TripAdvisor
also bought Bokun
in 2018 and Airbnb
last week made a major investment in Tiqets
).

“I think there’s a slight conflict in the way it’s been
aligned between the reservation systems and the OTAs for our partners. And I
think that creates a little bit of confusion,” Checkfront’s Morehouse said during the panel
discussion.

Peek’s Bashir added operators are concerned about OTAs having access
to data – not just about customers but about strategic business areas such as
pricing patterns, buying behavior and distribution.

“It’s not only what is being committed to today but what
may happen over time. That’s the concern we hear from a lot of businesses,” Bashir
said.

Speaking to PhocusWire after the panel, Valverde says underlying
these concerns is “a lot of fear in the air” on the part of these and other
founders that are wondering about their exit options now that Bookings Holding,
TripAdvisor and Airbnb have all teamed up with other startups and “it doesn’t
seem like Expedia’s making any moves.” 

“FareHarbor is playing nice. And we’re running it like a
modern, mature travel company, with Chinese walls and data privacy and anti-competition.
And we’re an incredible partner to TripAdvisor and Expedia and GetYourGuide,”
Valverde says.

“I think at the beginning there was fear by not only the reservation
software companies – because where are they going to land – but by the other
OTAs about what is Booking going to do. And we’ve made it abundantly clear that
we’re going to run it the right way. So I think a lot of the spiciness is due
to ‘where are they going to go.’”

Speaking to PhocusWire, Bashir says she’s confident Peek can continue to grow to become
a “multimillion-dollar business” thanks in part to the $50 million in capital
it has taken in that is allowing it to invest in updates such as mobile
capabilities and business intelligence analytics.

“The opportunity is massive. I think ultimately there’s scope
in a $180 billion market for there to be a handful of large players,” she says.

“I don’t think there’s a ton of consolidation that needs
to happen. There are often multiple players around reservation systems. I think
a handful of companies will end up owning a lot of the market share.” 

Rezdy’s Atkin said the sector is still young and “there
are plenty of exits that will develop as the market matures.” 

Fast-forward

Valverde takes a different view.

“There are two ways to start a software company in tours and
activities: You can go low cost, run it lean like Bookeo, which is $39 a month,
maybe has three employees. They’ll be around forever. If you try to make a big
company, eventually you need to team up with somebody. And the fact that we are
the largest by a long mile … and the fact that we are playing nice with Expedia
and Viator and GetYourGuide, there’s not really a reason, as a major travel player,
to buy another reservation software when they are so much smaller.

“Maybe an exit opportunity could be private equity or other sort
of play, but then you just look at our acceleration. The sheer speed at which
we’re growing doesn’t bode well for the future of the other software systems.”

Valverde says FareHarbor’s pricing model, which charges a 6%
fee for online bookings, has created a “symbiotic” relationship between the
company and its operators that has enabled it to invest in new technology and
more staff as its clients grow their businesses.

He cites examples such
as FareHarbor’s division that builds free websites that “convert really well” for
clients, while another group of staff are dedicated to maintaining the API
connections with distributors such as TripAdvisor and another advises clients
on search engine optimization and Google AdWords.

“The tour and activity industry is incredibly complex. We couldn’t do it right now without 600 people,
and to do it right you have to have a big team and you have to work to grow
your clients year over year,” Valverde says.

“We have 24/7 support. If your power goes out on your island
where your boat tour is, you can call in and run your business from your phone
with our support center. We’ll help you at 11 p.m., tell you who’s on your
manifest and check those people in for you.”

Looking ahead, Valverde says FareHarbor will launch a new
seat assignment feature early next year that will allow the system to work with
clients such as dinner cruises and small concert venues. Other priorities include
adding payment options to service new markets and adding larger clients in
existing markets.

“They [Booking…

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