In over a decade of working with operators and owners in the tourism industry, I’ve found one myth to be more prevalent and limiting than any other:
If you want more, do more.
Many operators do not simply believe this myth—they adhere to it. They knuckle down and keep grinding it out, hoping their efforts will produce the results the myth tells them they will. The irony, of course, is that as you adhere to doing more, the less you end up having and the more limited your business potential becomes.
Instead, why not rewrite that myth:
If you want more, do it differently.
For those in the tours, activities and attractions sector, there’s never been a better, or more important, time to do it differently. Diversification is the name of the game — namely, because the game itself is also changing. Technology, time, remote work, AI, and many other factors are completely changing the face of the tourism industry — and in many cases, for the better.
The question then becomes, for tour, activity and attraction owners and operators today, how do you quickly and effectively diversify your revenue? Consider the six steps below to do just that.
6. Host One-Off Dinners and Special Events
Offering special events like chef-focused dinners with more history and involvement can attract a different crowd than your usual tours. These events can highlight local cuisine and their chefs, offering guests a unique dining experience that goes beyond the standard tour. By incorporating storytelling, live demonstrations, and exclusive menus, you create memorable experiences that can also command a higher price point.
Midgi Moore, Chief Eating Officer at Juneau Food Tours, has had incredible success with one-off dinners. Her events have been so successful that she has even invested in an outdoor kitchen setup. This investment reduces the stress on her chefs and makes it easier for them to deliver an incredible experience for her guests.
By providing a dedicated space equipped with the necessary tools, her chefs can focus on creating memorable dishes and giving her guests personal interactions. This not only enhances the guest experience but also creates another revenue stream for the business outside of public tours alone. These special events diversify the offerings of Juneau Food Tours, attracting new clientele and providing existing guests with more reasons to return.
5. Partner with Other Tour Companies
Collaboration can open new revenue streams and expand your audience. Consider partnering with other tour companies to offer mixed experiences that attract a broader range of guests.
For example, Chicago Pizza Tours and American Ghost Walks have teamed up for the fourth year in a row to offer a unique pizza and ghost tour. This partnership brings fresh exposure to both companies and creates an experience that stands out in the market.
These hybrid tours appeal to both locals and visitors who might not have considered either tour on its own. By pooling resources and expertise, both companies can offer a distinctive and memorable experience that combines culinary delights with thrilling stories.
This approach not only enhances the appeal of each individual tour but also ties into the idea of hosting special events that cater to the local market, providing guests with new and exciting ways to explore their city.
Who can you team up with in your market? (Hint: Arival events are a great place to meet potential partners in person!)
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4. Develop a Retail Space
Setting up a retail shop or offering curated boxes online can significantly diversify your income. This approach not only generates additional revenue but also keeps your brand in the minds of guests long after their tour has ended.
Savannah Taste Experience, for example, has successfully launched a physical retail space. They use this shop to highlight local products and souvenirs, incorporating it as a stop on their tour. The shop provides guests with a memorable experience and offers them the chance to purchase unique items, further enhancing their connection to the tour.
The experiences of tour operators in places like Savannah, Bienville, and more demonstrate that a well-curated retail presence can be an effective and profitable extension of your tour business.
3. Sell Merchandise
Offering branded and themed merchandise can be a lucrative revenue stream for tour operators. By selling items like t-shirts, hats, mugs, and tote bags featuring your logo or unique tour designs, you create additional income while enhancing brand visibility.
Consider also offering products that reflect the essence of your tours, such as local crafts, food items, or custom-made souvenirs. These items serve as tangible reminders of the experience and help maintain a connection with your guests. To maximize sales, display merchandise prominently in your guidebook and during tours.
During the pandemic, we saw tour operators upend the industry standard by finding innovative ways to stay connected with their guests. For example, Devour Tours created a digital cookbook featuring recipes from their tours, allowing guests to recreate their experiences at home. Chicago Beer Experience started hosting virtual happy hours, bringing people together online to enjoy curated beer tastings. Unexpected Atlanta launched local food boxes, delivering a taste of their tours directly to customers’ doors.
These creative approaches not only provided new revenue streams but also kept the brands engaged with their audiences, demonstrating the value of their expertise in new and exciting ways. By adopting similar strategies, you can diversify your offerings and ensure your business remains resilient and adaptable.
2. Work with DMOs and DMCs
Destination Marketing Organizations (DMOs) and Destination Management Companies (DMCs) are invaluable partners in the tourism industry, providing extensive local knowledge and logistics management for large groups and events. By forming partnerships with DMOs and DMCs, you can tap into a steady stream of business from corporate events, conferences, and incentive travel. Ensure your offerings are tailored to meet the needs of these groups, focusing on seamless, high-quality experiences.
Additionally, collaborating with DMOs and DMCs allows you to leverage their established relationships and marketing channels, expanding your reach to a broader audience. Think of DMCs in particular as the OTAs of the private world, connecting you with exclusive corporate clients and high-end travelers. These partnerships can also lead to co-branded promotions and joint ventures, further enhancing your visibility and credibility.
By working closely with DMOs and DMCs, you can stay informed about emerging trends and preferences in the market, allowing you to continuously refine and improve your tour offerings. This proactive approach ensures that your business remains competitive and relevant in a constantly evolving industry.
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1. Focus on Corporate Clients
One tour company saw their corporate group revenue increase from just 5% to 60% by shifting their focus to corporate groups. This strategic move not only boosted their overall profitability but also significantly enhanced their standing within the corporate sector.
Corporate groups represent a significant, sometimes even untapped, revenue opportunity. For this to be effective, though, a few steps have to be taken, including defining new sales processes, setting up a CRM (customer relationship management system), and implementing targeted email marketing strategies.
This focus can generate substantial sales, which is excellent. But more importantly, it forges long-term client relationships — upon which so much long-standing growth and revenue are built. Establishing these connections requires an understanding of corporate clients’ unique needs and tailoring your offerings to meet those needs seamlessly.
Chicago Pizza Tours achieved impressive results by concentrating on corporate bookings. In just six months, they generated $100,000 in revenue solely from corporate groups. By reducing their reliance on OTAs, they tapped into a more sustainable and profitable revenue source, underscoring the value of a corporate-focused approach.
The benefits of corporate tours extend beyond immediate revenue. They also contribute to a stronger brand reputation and increased market visibility. Companies that offer memorable experiences to their teams are more likely to recommend your services to others in their industry. Moreover, a successful corporate tour can lead to repeat business, as organizations may choose to return annually or even more frequently.
By prioritizing corporate clients and customizing your approach, you can ensure a steady stream of business and solidify your position in the market as a go-to provider for corporate tours.
Learn more about how to increase your revenue from corporate groups here, and see this case study on how Chicago Pizza Tours crossed the $100k threshold.
No Time Like The Present
Developing new revenue streams will strengthen your business over time and increase its overall worth when it’s time to sell. Protecting your business by tapping into new markets is not just a smart move—it’s essential for long-term sustainability and growth. Now is the time to start developing these new revenue streams to secure your business’s future.
The only constant in our business is change, and when it comes to change, there’s no time like the present.
About the Author
Joe Martin is a business growth consultant and TEDx speaker, as well as Founder and CEO of UpLevel Tourism, which focuses on helping tour companies increase their corporate group bookings.
Learn More about Diversifying your Revenue with Arival
Insider Pro Access members are invited to join our upcoming Arival Elevate online session where Joe Martin will join us live to discuss diversifying your revenue, on August 22, 2024.
Also, join us at the upcoming Arival 360 | San Diego to learn more about growth, strategy and diversifying your revenue, including a breakout session with Joe Martin on working with corporate groups.
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