The State of Cancellations

It’s an all-too-common complaint among tour and activity operators – and an industry blindspot: cancellations. Flexible cancellation policies have become standard practice across much of the industry, driven in no small part by online travel agencies (OTAs) promoting “book now, pay later” and pushing operators to accept last-minute cancellations with full refunds.

The problem? While this flexibility makes sense for consumers, it can have a significant impact on operator cash flow, staffing, inventory planning, and ultimately profitability. The operators most at risk are those with hard supplier costs (such as food tour operators paying restaurants, or operators subcontracting transportation or hotel pickups).

In many cases, these suppliers still need to be paid even when last-minute cancellations come in. Just two or three cancellations on a single departure can be the difference between profit and loss. And yet, there has been little industry-wide sharing of real cancellation data. Operators have little guidance on what standard cancellation rates should be, whether their rates are too high, and what they should do about them. 

That’s why Globick’s Travel Experiences 2025 report caught our attention. Based on 200,000 bookings in 2025, Globick reported an overall cancellation rate of just 6%. On the surface, that is very low compared to what many operators have reported to us anecdotally. So we dug deeper with the Globick team to understand what’s really going on.

Once city passes and non-cancellable attraction tickets are removed, the picture changes quickly: cancellation rates rise to 11.5%. So what can the data tell us about what’s behind these cancellation rates?

More Advance Booking Leads to More Cancellations

One of the strongest correlations Globick found was between cancellation rates and advance booking. Bookings made further in advance cancel far more often. 

Channels with long lead times, such as DMCs and traditional retail travel agencies, show cancellation rates as high as 19.4%. By contrast, consumer-facing online channels, including OTAs, tend to have much shorter booking windows and materially lower cancellation rates, around 10.3% once non-cancellable products are removed. (For the purposes of this analysis, Globick grouped its multiple OTA partners into an aggregate OTA grouping, and did the same for travel agencies and DMCs). 

In other words, flexible consumer policies matter, but booking timing and product type matter just as much. Travelers who book closer to the experience date appear more committed and are less likely to cancel.

Operator takeaway: Set price and policy by booking window, not just by channel.
Not all bookings carry the same risk. Long-lead bookings cancel far more often than last-minute ones. Consider tighter cancellation windows, partial refunds, or deposits for bookings made further in advance, especially for higher-priced tours and group products. At the same time, operators need to watch conversion closely. More restrictive policies can reduce cancellations, but they may also impact sales, particularly on OTA channels.

We hope more organizations will share data like this. Until they do, cancellations will remain one of the industry’s most expensive blind spots — and one operators will have to manage without reliable benchmarks.

We should note some limitations in how cancellation data is recorded. Some cancellations may reflect booking changes rather than true demand loss. A traveler may need to make a change to dates, times, or group size, which often appear as a cancellation followed by a rebooking. This can inflate cancellation figures. In addition, the data does not fully distinguish between customer-initiated and operator-initiated cancellations. Factors such as weather, minimum group thresholds, or staffing constraints can also drive cancellations.

Learn More with Arival

Keep up with the latest on the ever-evolving experiences industry landscape with Arival. Join us at the next Arival event to stay up to date on the latest developments in the experiences sector directly from tours, activities and attractions industry leaders and experts. 

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