May 10th, 2018
All of the recent clustered developments within the tours and activities space including Booking Holdings' acquisition of FareHarbor, TripAdvisor's acquisition of Bokun, and Marriott's tweaks to its Magic Moments program should be considered within the context of Google Maps.
The Maps feature is effectively becoming Google's default travel platform, as it continues to transform from a search tool into a local discovery tool. This will eventually give local tour operators and other businesses that target visitors a new way of funneling customers. It will also move Google further down the proverbial funnel by targeting users with personalized content and real-time recommendations based on what's trending.
We expect Google to eventually dissolve the Google Trips app - similar to what it did with Hotel Finder. Advertising on Google Maps is already a thing. Local businesses pay to stand out. Integrating all or some of the Google Trips (currently separate app) functionality will make Google Maps more attractive to visitors (non-locals) as they familiarize with locale pre-departure and in-destination. More non-local traffic will make Maps an interesting advertising platform for tour operators. Plumbing will be content and market-driven based on keyword and category search.
Google Maps is becoming an exploration platform.
The long string of impressive announcements at this week's I/O 2018 Google developer conference included new enhancements to its Maps product slated to roll out later this Summer. Google Maps was a key feature discussed. The platform is essentially transitioning from a search tool into a local discovery tool offering users recommendations on where to go and what to do based on real-time data of what's happening in a given city or neighborhood.
Here is an excerpt from a recent TechCrunch article explaining the features. "So in the new Maps, you’ll find the new “For you” tab that’s basically a newsfeed-like experience with recommendations for you. You’ll be able to “follow” certain neighborhoods and cities (or maybe a place you plan to visit soon), similar to a social networking experience. When Google Maps finds interesting updates in that area — maybe a restaurant that’s trending or a new coffee shop that opens — it’ll tell you about that in your feed."
Canned vs dynamic content for activities.
We see two paradigms emerging when it comes to content and data for what the travel industry refers to as "tours and activities" and more recently "experiences". Canned content includes trail rides, food tours, and scheduled art lessons. We call it “canned” because while pricing and availability changes, the product remains consistent. Travel booking sites like Airbnb, Booking.com Expedia, and TripAdvisor are rushing to upload this content as bookable products. What customers have access to is also largely a function of how fast these suppliers can integrate canned content.
Dynamic content involves ephemeral activities based on what's trending at the time in a given area, particularly in urban settings. These include concerts, new restaurants, art exhibits, parades, marathons and more. This dynamic content is quickly becoming the domain of Google - through Maps.
Last year's NYC Pride March
Google Maps displayed the route with clever custom colors one day before the event making it easier for spectators, taxis, local businesses to plan.
We go every year. A wonderful way to celebrate equality and New York City.
The level of data that Google can acquire on individuals, crowds and general flow and movement of people will give it the ability to personalize at scale. This will move Google further down the proverbial purchase funnel by giving local businesses the ability to target both locals and visitors in real-time.
Apple has fallen behind in this space and will struggle to catch up. Baidu, the Google of China, is doing the same thing with its map feature in China and globally. Users on Baidu Maps will receive different recommendations based on what's trending with that user base.
Baidu Map of New York City
Google Maps will have both.
For those travel consumer brands pursuing the tours and activities space, the question then becomes, can and will Google push further down into the canned experiences purchase funnel? Very likely and having both the canned and dynamic content will give Google an advantage over other travel apps. Travelers like to do both. Canned experiences are typically booked further in advance while dynamic experiences are part of the regular flow of the visitor experience. One platform that has access to both is more useful for the user. Time is a more precious commodity when traveling.
Travel is a life function. Google is a life platform.
Travel as a function of human life boils down to navigating between two worlds: the familiar or local worlds and less familiar outside worlds. Travel companies are great at facilitating the transition between these two worlds in all manner of ways including the discovery, retrieval, and visualization of local information. Google is arguably the best at this process. There are other companies that fall in this category that we at LUFT call "life platforms".
There are shopping apps and then there is Amazon. There are social media apps and then there is Facebook. There are smartphones and then there is Apple. There are job search sites and then there is LinkedIn. There are search engines and then there is Google. All of these companies have managed to dominate individual and basic life functions before moving into other areas. They now compete on many levels. There are others with great business models and loyal customers. Life platforms have the scale in terms of capital, users, content, technology and other compounding properties. Artificial intelligence is where many of these players overlap. AI also gives Google the ability to personalize recommendations on where to go and what to do.
Google Trips Will Eventually Fold Into Google Maps.
We saw it happen with Google Hotel Finder. Last year the company dissolved the stand-alone hotel booking app and integrated its accommodations search into the main Search and Maps applications. The same thing will likely happen with Trips. Promoting a new platform like Trips when Maps already has the same functionality and all of the traffic seems mismatched for an ad-driven platform like Google. Our sense is that Trips is essentially a test environment for Maps.