7 Steps to Start an Online Travel Agency Business
We live in the startup era, where budding entrepreneurs are passionate about turning their dream project into a lucrative business. Launching a travel agency business can be equally rewarding and intimidating in this booming entrepreneurial era. According to a study, 71% of businesses fail within 10 years of their operation. Turning your business idea into a travel company and getting it off the ground might seem challenging. But it would be best to start with proper planning, make appropriate financial and legal decisions, and much more to keep it operational. Online travel agencies or OTAs are the most dominant players in the travel market, with a share of $561 billion in 2021. OTAs are one-stop-shop to search and book everything from flights and accommodations to excursions, making it hassle-free for travelers to book for their upcoming trips. A new research by Statista predicts that by 2025, the OTA market is expected to reach $833.5 billion. 7 Steps to Start an Online Travel Agency Business Owning an OTA business in 2022 is lucrative as 81% of travelers heavily rely on OTAs to search and book for their upcoming trips. Let’s now dive into the top 7 steps that you need to take to start your travel agency business. This post can be a blueprint for launching your online travel agency. 1. Develop a Business Plan Your online travel agency business plan will be a roadmap for establishing your idea. The document will showcase every aspect of your business- company goals, vision, business strategy, financial plan, products or services, your target audience, marketing strategy and strategic partners: These can be suppliers and tech as well. Developing a business plan will keep you on track with your vision. Also, to stay competitive in the constantly evolving travel market, you need to revise your business plan constantly. Read More – The importance of responsive web design for OTAs and its implementation 2. Identify your Niche Market Since the travel industry is highly dynamic and competitive, you need to identify and choose which travel market do you want to target. Start with market research to understand your potential customer needs. In this step, you must focus on: Target audience travel behavior and preference Types of travel products such as hotels, flights, excursions, cruises, etc. to sell Finding niche travel markets Why is it essential to find your niche to start an OTA business? Well, the competition is fierce with brands like Booking.com, Tripadvisor, Kayak, Expedia, and much more. You need to stand out and compete efficiently in the travel market. And this can be possible by being an expert in your niche and answering every trip-related question the modern traveler asks. According to a research some of the booming travel niches that your business can dive into are: Bleisure travel Adventure travel Healthcare tourism Eco-friendly or sustainable tourism Gastronomy tourism Wellness and spiritual tourism Heritage and cultural tourism Recommended: Five Ways World Travel And Tourism Industry Digitalizing Journeys 3. Find the Right Mix of Partners and Inventory Suppliers The next step is to develop fortifying partnerships that can help your business grow. During the early stage of your startup, you need to work with multiple suppliers or providers to sell your travel products and make money through commissions. Let’s say your niche is heritage and cultural tourism in Italy. To sell your travel products and grow effectively, you must connect with a wholesaler with the largest hotel inventory, airlines, and other travel services. Talk to various providers, suppliers, compare their prices, services, and the commissions you might earn and then decide on the partnership. 4. Organize your Tech Platform With a business plan, niche and partners in place, it’s time to build a technology platform. Focus on these five main tech platforms: Search engine for customers to book Booking engine for automation of OTA workflow Back office for business operations Commission engine Recommendation engine to enhance customer experience It is difficult to work independently, and that’s why it’s ideal to integrate booking engine and other third-party APIs (flight search, hotel booking by suppliers, NDC, hotel mapping, car rental booking, payment gateways, CRMs) to your website for a hassle-free user experience. 5. Register your Online Travel Agency Business This is a crucial part of your business. With major tasks off your plate, it’s time to make your travel business legal by registering with the government. Here is the checklist to do so: Choose your business name Apply for licenses and permits as per your local laws Apply for business insurance Invest in accounting software 6. Gain Accreditation Accreditation will make your travel agency business credible. Obtain accreditation from IATA, ARC or any other reputed travel organization, contracts from GDS. This accreditation will review your industry experience, finances and even provide training and support to flourish successfully. Recommended: How Can IATA Travel Pass Help Countries Reopen Borders? 7. Financial Plan To successfully start your online travel business, you will need sufficient capital. There are different ways of funding capital. Some of them are: Personal savings Credit cards Money from family and friends Venture capital Angel investors Crowdfunding Small business loans and grants A combination of these funding sources can help you get off the ground. To secure this capital, you need to have a financial plan of how much money you need to raise and how your business will make a profit. You are now set to take off your online travel agency business with these essential steps. It can be daunting initially, and your startup might have roadblocks, but stay dedicated and remember these steps to start and grow your new business seamlessly.
Highlights from Arabian Travel Market Dubai 2022
Vervotech had the opportunity to attend Arabian Travel Market (ATM), Middle East’s largest travel and tourism exhibition, from May 9-12, 2022. We were a first-time exhibitor at ATM Dubai 2022 and the four-day event was packed with attendees, clients, and partners. We had one of the best events- filled with high energy, enthusiasm, and positivity. ATM Dubai took place at Dubai World Trade Center (DWTC) in collaboration with Dubai’s Department of Economy and Tourism (DET). The 29th edition of ATM hosted around 1500 exhibitors from 112 global destinations and the theme this year was ‘the future of international travel and tourism.’ Marvel Puri, Co-founder and CRO of Vervotech, shares his insights from the four-day event. Q: What was the highlight at ATM Dubai? Marvel: Sustainable initiatives and responsible tourism. We saw a few travel companies launching their sustainable initiatives with an initiative to make the world a greener and better place. One that caught our attention was the Turkish Airlines of use sustainable aviation fuel (SAF) that is produced from raw materials free from harmful metals and reduces emissions by 87%. The main takeaway was that the travel industry wants to be more socially and environmentally responsible. The industry leaders are getting serious about climate change and are chalking out a net-zero carbon emission plan. Q: During your conversation with attendees what are the challenges with respect to technology? Marvel: Technology migration needs constant support. Talks from ATM attendees revealed that there are still challenges in travel technology platform migration. There is a need for knowledge sharing to bridge the gap between user adoption of new technology and smooth migration. It is inevitable for enterprises not to use technology, but travel tech providers need to offer constant support to their clients for a smooth transition. Q: What technology was trending at ATM Dubai? Marvel: Bitcoin, crypto payments, blockchain, and NFTs were reserved for art and e-commerce, but we see its growing interest in the travel business. At the ATM event, we saw Emirates, a Dubai-based airline, plan to accept Bitcoin payments and release NFTs to be traded on their website. These initiatives reflect how the travel industry progresses towards digital transformation by adopting the latest digital technologies. Q: Any other thing that stood out for you in ATM? Marvel: For the last couple of years, influencer marketing has been flourishing. According to research, 42% of consumers purchase after seeing an influencer post about it. This was highlighted in ATM by different influencer platforms. I came to know that there are various influencer marketing platforms that help brands connect, partner and collaborate with influencers to increase their customer base and sales. Also, at one of the sessions hosted by ATM, there was a buzz of gastronomic tourism or gastro-tourism. There has been a surge in gastro tourists, where travelers plan their trips around food and where they want to dine. There is a demand for unique dining experiences and travel agencies can tap this opportunity and design holiday packages around food destinations to target the gastro tourists. Q: Any suggestions for the travel business? Marvel: I think travel is already recovering very well after Covid. Companies were patient and now they are seeing good traction for their business. They just need to constantly think about one thing – Staying on top of their customer’s minds. The industry should make sure that processes are smooth for reopening and that adequate assistance is available for their customers to help them adapt to new ways of traveling. And most importantly, they should invest smartly and innovatively in technology to streamline their business operations and customer engagement. In-person events have a tremendous impact in comparison to virtual events. After two years, the travel fraternity came together to make this event successful, and the vibe of ATM 2022 was positive and energetic. ATM Dubai’s in-person event helped create meaningful relationships with our clients and partners. The one thing we take back is the zeal to work on our products and keep delivering the best to our customers and their preferences. Vervotech is a leading Hotel Mapping and Room Mapping API that leverages the power of AI and ML to quickly and accurately identify each property listing through the verification of multiple parameters. With one of the industry’s best coverage of 98% and an accuracy of 99.999%, Vervotech is quickly becoming the mapping software of choice for all leading global companies operating in the travel and hospitality industry. To learn more about Vervotech and the ways it can enhance your business in the long run contact us: sales@vervotech.com
