Travel industry news website Skift has a knack for eye-catching headlines, but their scoop on some new ad product testing by Google hardly warrants the “game-changer” moniker, at least for now.
Such tests by Google should not be a surprise to anyone following what’s happening in our industry. Late last year Google’s travel group absorbed the tours and activities startup, Touring Bird, which had been a part of the company’s secretive incubator Area 120.
Although Skift’s coverage focused on the closure of the initiative and framed it as a failure, our sources at the time indicated just the opposite: Google Travel recognized the potential opportunity in the sector and were plotting their plan of attack.
Our take at the time was simple: expect Google to follow a similar path that has proven successful from their flights and hotels products, and test a variety of search and ad products to see what works. So expect a lot more testing.
OTAs face a familiar dilemma
To play with Google or not to play, that is the unending question facing OTAs. This new initiative, as reported by Skift, indicates that Google is only working with online travel agencies (OTAs), following the same approach as Touring Bird. Operators may not advertise through this product.
Pay to play, and OTAs risk elevating Google’s own search products, which over the long term could increase their dependency and overall marketing costs. But if they don’t, they risk losing that valuable traffic to competitors who will pay. It’s this issue that has dogged OTAs in flights and hotels especially. It was only a matter of time before it would happen in tours and activities.
Once Google finds its footing with its ad products for the sector, expect plenty of disruption ahead for the future of search. But it may take some time.
While OTAs wrestle with these existential search questions, operators should be keeping tabs on another Google initiative: Reserve with Google.
With Reserve, the Plot Might Thicken
This is by far a bigger question for operators: where does Reserve with Google fit in. Reserve, the booking button from the Google MyBusiness listing that connects directly to OTAs and reservation systems, enables Google users to book a tour or attraction ticket within the Google environment.
Reserve presents an interesting opportunity for operators to compete more directly with OTAs in Google. For those operators who use a connected reservation system, they can accept bookings directly from Google. So far, Google has not been charging a fee for those bookings.
But as is usual with Google, there are more questions than answers. In April this year, Google Travel quietly brought Reserve into the fold. We covered that story here, Google Takes Soft Steps into Tour, Activity Booking. The move implied that the capabilities of Reserve could play a larger role in the Google shopping funnel. This could be a boon for operators, but Google has revealed little (actually nothing) about if, when and how that might happen.
The other big question is advertising or booking fees. At some point Google will seek to monetize Reserve. When they do, operators and OTAs will have yet another Google advertising product to consider.
Like it or not, Google remains front and center in our industry. We will continue to track their initiatives in tours and activities and what they mean for operators.
