I can feel travel beginning to come back. TSA checkpoint volumes are hitting post-pandemic highs, business travelers are starting to come out from behind their Zoom sessions, and vaccination rates are prompting more people to make travel plans. So on this episode, we first talk to Paul Melhus, CEO of ToursByLocals about the state of the local tour market and then about how frequent travelers are starting to stretch their atrophied travel muscles. All this and more – click here to download the podcast file, go up to the Subscribe section in the top menu bar to subscribe on your favorite site, or listen right here by clicking on the arrow on the player.
Here is the transcript of TravelCommons podcast #175:
- Intro music — Warmth by Makkina
- Coming to you again from the TravelCommons studio in Chicago, Illinois. Just one bit of travel since the last episode, a drive down to Nashville, Tennessee. Right at about a year ago, this drive was my first post-lockdown trip. I talked about it at the start of episode #164 — no one was on the road save for a few trucks and a few folks like me. It was a drag race down I-65, 80-85 mph the whole way, maybe dropping down to 70 going through Indianapolis and Louisville. You couldn’t be sure what restaurants had their drive-thrus open, so car snacks were key. But now, it’s back to the normal drive — lots of trucks and having to jockey for position with them on the 2-lane stretches, slow-downs through construction zones, and having to think again about timing the drive so I thread through Chicago, Indianapolis, Louisville, and Nashville without hitting rush hours.
- A year ago, the restaurants that were open were only doing take-out, so I ate in my hotel room every night, which led to me putting “bring-your-own dining sets” on my 2020 travelers gift guide 6 months later.
- One thing that hasn’t changed is hotels not cleaning rooms during the stay. On this trip, I was in a Courtyard for 4 days and no one but me walked into that room. At what level of COVID cases or vaccination rates do they also have to get back to normal service because walking back into the smell of damp wet towels every day, or having to find a hall garbage can to throw out the takeaway Korean is getting a little old. I do give that Courtyard points, though, for bringing back the free lobby coffee.
- I’m heading down to Miami next week for my first post-pandemic business trip. At the start of the year, everyone was talking about how business travel won’t be back until the end of 2022 or into 2023, and even then, it won’t come all the way back because Zoom and Teams will have replaced the need for 20-30% of business trips. But, I dunno, the TSA is regularly reporting new highs in post-pandemic checkpoint traffic — 1.63 million passengers the first Sunday of May and 1.64 million the first Thursday of May, averaging 8 times the traffic from the same weekday last year. And I don’t think it’s all leisure travel. I’m starting to see some 2019 behaviors coming back — execs flying out to a plant to do a one-hour town hall in person; people coming together, physically, in an office conference room to get around some white boards and solve a problem. Is it Zoom fatigue or reversion to the mean — at least for the vaccinated? I dunno, but I’m kinda looking forward to getting back in the saddle — well, except for next week’s horse being a 7am Monday rush hour flight out of ORD.
- Bridge Music — A Foolish Game by Zep Hurme (c) copyright 2014 Licensed under a Creative Commons Attribution (3.0) license. http://ccmixter.org/files/zep_hurme/46448.
- In the last episode, I talked about the spike of publicity around the deterioration of Uber and Lyft’s service — spiraling wait times that leads to big price surges that leads to driver cancellations as they work to maximize their pay. It’s not getting any better. I retweeted an Uber driver’s screenshots showing no cars at ORD and MDW on a Sunday night — prime time with people coming home from weekend trips, and it’s not a one-off event, especially at MDW. It’s also starting to make people rethink travel plans. A colleague on my Miami trip moved from a Hyatt to a Marriott closer to our meeting place, saying she couldn’t trust Uber to show up in time. And even for me, I’ll get up earlier than I need to so I can catch public transit to ORD in case Uber or Lyft fail and I can’t find a cab. It doesn’t feel like that $250 million “driver stimulus” Uber was touting last month has made much of an impact.
- Empty Hertz lots has also been a multi-episode arc that doesn’t look like it’ll go away soon. Rental car companies dumped cars during a historically high used car market to generate cash that saved them at the start of the pandemic. Hertz dropped almost 200,000 vehicles in the back half of 2020. While Avis’s fleet shrunk about 31%. But now that travel has snapped back faster than expected, they can’t get more cars; the new car inventories are at historic lows because of chip shortages.
- And the combination of these two is a helluva pincer movement on a lot of returning travelers because they’d ditched rental cars for the convenience of Uber. Now they have neither. I plan on doing a good bit of walking in Miami.
- DMV managers across the country must’ve breathed a sigh of relief when they saw Homeland Security announcing yet another delay in Real ID enforcement for air travel, this time to May 2023. I remember in 2019, more than a year before the original October 2020 enforcement date, the warning signs went up at the TSA desks in airports and immediately there were predictions of mass chaos. I was one of them. Back in episode #155 in September 2019, I said “Note to self – don’t book any travel in October 2020.” But then, 6 months later in March 2020, as COVID shut down DMV offices along with the rest of the economy, DHS made the obvious call to kick the deadline down the road a year to October 2021. I remember my first post-lockdown flight in June, the TSA desks at MDW still had the old 2020 signs up. A few months back, some friends had to renew their driver’s licenses and so figured they’d get the Real ID version. After some 8 hrs of queuing at a just-reopened Illinois DMV, they had gold-starred IDs and were good to go for October travel. Last month, a little alarm bell went off in my head — “You know, that deadline is 6 months away; you need to start thinking about this.” But just as I started to, the news hit my Twitter feed — delayed not just a year, but to May 2023, 18 years after it was signed into law. At what point is Real ID past it’s “Best Used By” date — if not already?
- Many of us lost track of these peripheral travel bits during lockdown. We were driving our daughter Claire to ORD for a flight to Philadelphia last month. She pulled up her boarding pass on American’s mobile app — “Hey, I don’t have PreCheck!” Huh, well maybe there’s something wonky with the app, I told her. Hit a kiosk if you have time and pull another boarding pass. Turns out, because of construction traffic, she didn’t have time but the regular TSA line was short, so it wasn’t a problem. But the same thing happened on her flight home — on Southwest this time. OK, not a res system glitch. She logged into the TSA website. Her Global Entry, which includes PreCheck, had expired a few months back. Which prompted Irene to log in; she was expiring that day so she immediately hit the Renew button — and then spent the next 30 minutes reconstructing our travel history for the last 5 years. Thank God for cell phone photo archives. I figured I should check mine too. Logging in was a little bit of a hassle — I had to create a new account at login.gov, some federated government login that replaced TSA’s login. Once in, I saw my expiration date isn’t until the end of the year, so I’ll start thinking about it in June or July.
- United Airlines CEO said searches for flights to Europe jumped 19 % after the head of the European Union said vaccinated US travelers would be allowed into the EU this summer. And shortly after that, United put on new summer flights to Iceland, Croatia, and Greece – certainly not business travel destinations.
- I had already placed my bet on the UK opening by Thanksgiving. Actually, I was repeating the same bet I placed about this time last year when cash and frequent flier prices went cratered. I booked ORD-LHR flights on American for 30,000 points each. When I had to cancel in September, the agent said “Wow! That was a great deal!. Yeah, I knew it. The price of this year’s bet was 50% higher. But with the US and UK vaccination rates, it’s feeling like a safer bet.
- The riskier bet was plunking down a deposit on a bike trip in Italy in mid-October. There was a lot of “It’s non-refundable so buy our trip insurance” language in bold italic font. So I went back and re-listened to episodes #163 and #173 where we talked about travel insurance and then dug deep into the insurance rider for the tour provider’s insurance and the travel insurance I’d get for free if I charge it on my Amex or Chase Sapphire cards. One hour and a couple of three-column tables later, I first threw out the Amex insurance; it was sorely lacking. Then comparing the tour company with Chase, neither of them offered cancellation coverage if a, what is it, a fifth wave of COVID (I’ve lost count) causes Italy to close its borders again. Running through the rest of the comparison, the tour company offered a bit more, but not enough (at least to me) to justify the additional $760 cost for Irene and me. So I charged the deposit on the Sapphire card and am hoping for the best.
- And if you have any travel stories, questions, comments, tips, rants – the voice of the traveler, send ’em along to firstname.lastname@example.org — you can send a Twitter message to mpeacock, post your thoughts on the TravelCommons’ Facebook page or the Instagram account at travelcommons — or you can post comments on the web site at TravelCommons.com.
- Bridge Music — Hear Me by DJ Blue (c) copyright 2007 Licensed under Creative Commons Attribution Noncommercial Share-Alike license http://ccmixter.org/media/files/DJBLUE/11541.
How to Find Local Tour Guides
- This is a topic where I need to, up front, state my priors — I don’t do well with structure when I travel. Well, let me refine that a little — I don’t do well with other people applying structure on me when I travel. I don’t cruise, I’ve always hated forced “team-building” outings during company sales meetings, and I cringe whenever I run across tour guides walking backwards, reciting factoids to trailing lines of people tethered to them through wireless headphones. To be honest, I look down on them — I can do better, more authentically with my own research.
- But that’s really more pride, and maybe a bit of cheapness, talking than real facts. I’ve had great experiences with small tours. Way back in episode #105 — 8 years ago! It always amazes me how long I’ve done this; and amazes even more how long many of you have been listening — I talked about a couple of private tours that completely readjusted my attitude — a tour through Saigon with an ex-South Vietnamese army officer, a food market tour in Madrid, a wine tour in Priorat. They were phenomenal, but they were all second-degree connections — friends recommending other friends or acquaintances. So unless you have a lot of friends with connections to places you want to visit, that word-of-mouth model doesn’t scale.
- Which leads me to this episode’s guest, Paul Melhus, CEO & Founder of ToursByLocals, a private tours marketplace. I talked with Paul about the local tour market, how he fared during the COVID travel meltdown, and what things look like from his vantage point as we’re coming out on the other side.
- Mark: Paul, help us understand your marketplace, how you help travelers search and book for local tours. This is a space that had a lot of startup activity, say five years ago. Everybody was a peer-to-peer tour marketers and the Uber of local tours. And now though, it seems that we’ve got a mix of large companies, Airbnb Experiences, Viator, and then smaller folks, offering a broad range of tours like yourself and Get Your Guide, and then some specialized niches in things like food, Eat With. And then last episode, we talked with Rob Cheshire about what he’s doing in This Week In Craft Beer. So, help us understand the market space.
- Paul: ToursByLocals is a platform, and our goal is to connect independent tour guides with independent travelers who want to have that kind of unique experience. I’ve often wondered why it is that we seem to have been successful. We started in 2008; somehow we’ve managed to thrive, and we always started right from the get-go to make sure that the guides that we’re on our site were competent, qualified, able to do what they said they would do. So we feel like our network of, we’re at 4,750 guides right now, is a curated list.
- Mark: So that curation, it’s not so much the Uber for local tours, maybe the Angie’s List for local tours.
- Paul: Yeah, I guess, Yeah, that’s a good idea because I think a lot of other companies, they just went out and tried to get a lot of guides and they didn’t really worry too much about making sure that every one of them is going to be quality, responsive — that’s a big thing — and then it’s the consistency of everybody knows how it works. In some cases, especially if the tour is more high value, like we have some safaris in Africa, for example where the customer will pay $23,000 and the guide, in order to deliver that tour, they can’t fund all of that on their own account, so we advance them funds. But you know if things were to go south, well, we’re here. And we have done that in the past, refund the traveler because who knows, maybe there was some weather-related event that caused the thing to get canceled and then, so we’re out the $5-6,000, but the customer is made whole.
- Mark: So there’s really two things that you’re offering above and beyond just the search and book. You’re offering curation and you’re offering escrow. So you’re taking some of that uncertainty in both of those areas, uncertainty about the qualification and then uncertainty about performance, you guys are taking that on. Paul, you talked about Covid. How has this curated network of tour guides held up through Covid?
- Paul: Right now, our maximum number of tour guides listed on the site was just over 5,000 and that was February 2020. Now we’re at 4,750. So, not huge and we have a status of tour guide called on hold — for the time being, I don’t want to be on the site, but I want to be able to come back once it’s safe. For an example. We had a guide in Denmark, had an elderly mother and she just didn’t want to be out there with people because she had to look after her parent. So we have a project right now to contact all of these people and see about getting them back on the site. But the other thing that offset the loss was, rather than laying all of our staff off, we repurposed them and tried to infill a lot of the smaller destinations, the Nashville’s, Flagstaff Arizona. And of course, Yellowstone National Park where our sales are up 1,300% over 2019 levels, which was a good year.
- Mark: That was the trend last fall, and I think going into the spring was everybody wanted to do outdoor stuff. Right?
- Paul: Oh, it really is. Now that people have got their vaccines, they want to travel and the easiest place to travel is domestically. So, we’re seeing a real boost in US travel.
- Mark: What do you see around trends? Do you see an uptick, and where is it?
- Paul: A metric that we track very closely is the conversion rate of our tour guides. So, if we send them an inquiry from a traveler, what percentage of those inquiries turned into a booking? We’ve noticed that the conversion rate is about half of what it was in 2019. Because normally a good guide converts about 40% of the inquiries and now it’s fallen down to about 20%. There’s a lot of dreamers out there. That’s what we’re thinking.
- Mark: There’s a lot of people shopping, but they’re not buying yet.
- Paul: Not quite yet. Now basically there’s the people that are booking are kind of falling into two buckets. Normally we would have kind of a nice smooth curve of not too many short notice bookings and then it would be a bulge and then tail off farther out. But what we’re finding is that people are booking within a 2-week window, so short notice, or their booking into 2022. We recently extended our booking calendar out 26 months and that’s driven some surprisingly long-term bookings. It’s that middle that’s missing and I think that’s where they want to go. But until such time as you can actually get on a plane and happily go to London without having a 14-day quarantine when you show up, people are just not going to do it.
- Mark: Super. Paul Melhus, CEO of ToursByLocals. Thank you very much for taking the time to talk to us here at the TravelCommons.
- Bridge Music — Gargantua by Admiral Bob (c) copyright 2014 Licensed under a Creative Commons Attribution Noncommercial (3.0) license. http://dig.ccmixter.org/files/admiralbob77/46361 Ft: My Free Mickey, Martijn de Boer
Rebuilding Travel Muscle
- Frequent travelers, road warriors, mostly sitting at home for the past 15 months, certainly not heading to the airport every week or two, our travel muscles have atrophied. That rhythm, that cadence, that confidence that separated us from all those regular travelers — well, all that and premiere status lines and lounge access which also physically separated us. I noticed this loss of travel muscle tone a bit on my trips to Tucson and San Diego over the last couple of months. I had to think a lot harder about those trips — what to pack, when to leave — things that were second nature to me, say, 18 months ago when I was traveling every week to Charlottesville, VA or Phoenix. Even on personal travel — to Poland, Hungary, Estonia, Finland — I had everything down; on the road, I had my groove.
- Pretty much all of my travelling friends breathed a sigh of relief during the first 6-8 months of lockdown — first, happy to be home and safe; then settling in, enjoying the extended family time, picking up some new hobby (even frequent travelers weren’t immune from the sourdough craze). But toward the end of the year, I could hear a bit of ansty-ness, and now, vaccines in arms, I’m seeing people getting back out on the road, beginning to rebuild those travel muscles.
- It’s been a pretty quick snapback. Remember, back in December, people like Bill Gates were saying to large virtual conferences that 50% of business travel would disappear and video conferencing was the new normal. I think the big ramp up in vaccination rates flipped this script. Again, back in December, the euphoria of vaccine approvals was quickly overwritten by the depressing logistics of manufacturing ramp-ups and cold-chain distribution. But now, five months later, people are again sitting across desks and conference tables from each other; initially masked, but then quickly running through their vaccination statuses and comfort levels so they feel safe dropping their masks and getting on with business. This “new normal” feels like it’s trending pretty quickly back to the old normal.
- At least for one-on-one meetings. Larger meetings and public spaces can’t do those same negotiations. But that’s enough for a start. Those same friends of mine who were loving their cocoons and sour dough recipes last year are looking to break out now. Like me, they tend to have pretty short attention spans and travel gives them the change, the external stimulus they need — new places with new people to see and new things to do.
- The seating chart for my flight down to Miami shows a full flight and is asking for volunteers to take a later flight. And this for a 7am Monday morning flight — first flight out, the standard business traveler choice. A lot of folks are getting back into that rhythm.
- Closing music — Pictures of You by Evangeline
- OK, that’s it, that’s the end of TravelCommons podcast #175
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