Tourism Industry Community

AMA with Michael Herrmann, Founder and President of TourConnect

We’re excited to be kicking off our first AMA. Join us on October 9, 2018 5:00 PM (Europe: Paris), October 9, 2018 8:00 AM (America: Los Angeles), October 10, 2018 2:00 AM (Australia: Sydney) (CDT / UTC -5) to ask questions directly to the founder of TourConnect Michael Herrmann. We are all very excited to be starting this series on the community forum.

We’ll be doing this all live at 5:00 PM (Europe: Paris), 8:00 AM (America: Los Angeles), 2:00 AM (Australia: Sydney) (CDT / UTC -5), however, if you’re unable to make it during the live event, we have opened this up to allow anyone to leave their questions before the live event for @mike-tourconnect to respond to during the event.

We can’t wait to see the questions, discussions, and sharing of experiences and knowledge.

Who is Michael Herrmann?

Michael Herrmann (@mike-tourconnect) is the Founder and President of TourConnect and owner of Bonza Bike Tours.

His passion and love for the Tourism industry began when he journeyed to Australia to begin a small bike tour showcasing beautiful Sydney - learning along the way. It was these lessons, processes and ultimately frustrations while growing Bonza Bike Tours to an award winning bike tour that stuck with him and have driven him to build TourConnect.

TourConnect is the manifestation of his passion to innovate within and grow the industry he loves.


Why don’t you work commissionable???

Hey everyone! I’m excited to take some questions today. I’ll also answer a few questions I hear pretty regularly as the founder of a small day tour company, as well as a software company in tourism.

Hi @santacruztrekhostal - That’s a great question, and one I get quite regularly.

TourConnect doesn’t work on commissions because we don’t ever touch or see individual bookings. Our goal is to help you manage your tourism industry B2B relationships in every way except the bookings.

The next question I get is…why?! I started TourConnect because for my bicycle tour company, I was overloaded with managing all of the administrative tasks that go along with building successful B2B distribution. This meant managing things like:

  • my contracts (where I give wholesalers and agents commissions for booking my products)
  • my high resolution images (so my partners could put them on their websites and brochures)
  • my insurance (sending out my public liability certificate of currency every year)
  • my announcements/special offers (so my partners knew about new products and some great offers)

All of these tasks are critical to generating bookings, but are not the actual bookings. While I wanted, and still do want, efficiency in how my bicycle tour company manages our bookings and inventory, there are a ton of companies out there trying to solve that problem (and love taking a clip of every booking’s revenue for doing so!). TourConnect instead focuses on managing and building great B2B relationships.

Overall, we believe B2B relationships are critical to our industry. Partners all work together to create incredible experiences for travelers - from researching a destination to making a booking to the actual travel experience itself. TourConnect is here to make all of that more efficient, so B2B partners work together as a seamless team serving travelers around the world.

Another question I get regularly is “Why does TourConnect’s contracting tool focus on static rates, and not dynamic rates?”

Dynamic rates are all the rage, and have been for nearly 10 years now; however, static rates remain resilient and don’t seem to be going away entirely any time soon. TourConnect fundamentally believes that a healthy revenue management strategy includes both dynamic and static rates. Let’s dive into this a little further…

Dynamic rates are driven directly out of a hotel or tour operator’s live inventory and gives companies greater control over their pricing based on the market at any given moment. Pricing can be adjusted on the fly - meaning if 2 rooms are left, the price could be $100, but if 1 room is left, the price jumps to $125.

Static rates are locked for a set period of time, say 1 year. There can be seasons during that year - so maybe high season is $125, shoulder season is $100, and low season is $75. When these static rates are provided to B2B partners/agents they are bound by these rates, regardless of what the demand is at the particular time of booking.

Dynamic rates are a very efficient way to distribution tourism products; however, there are a few challenges:

  • Dynamic rates require connectivity between systems

    • For tours and attractions, this is a challenge because the booking systems are trying to catch up with the technology available (so there are a ton of different systems out there that don’t have connectivity to distribution)
    • Many small-medium sized traditional wholesalers do not have booking systems that can handle dynamic rates (so when companies don’t issue static rates, they miss out on these companies selling their products)
  • Many companies still drive sales using brochures and group series that rely on bookings made far in advance

    • Companies using these methods need to lock in their margins, to ensure that bookings are profitable for all parties
  • Dynamic rates can drive margins down, as hotels can simply continually adjust prices lower and lower to beat out competition. By contrast, static rates lock in margins - and while there are times this can mean these margins are lower than what dynamic rates would have produced - a revenue manager can at least count on the margins over the course of a contract, and plan accordingly.

Overall, there are a lot of channel managers and booking systems throwing tons of investment at dynamic pricing…and we recognize how important this is to our industry. That said, static rates have their place in our industry, and static rates can be one of many effective revenue management tools available to our industry. TourConnect is happy to be the company leading the innovation in static rate distribution so that it can be used for years to come to help all of our businesses be more profitable.

Alright, here’s one last question I get from some of our users…“I connected with a new company, but I haven’t gotten a booking, yet…what’s the deal?”

I hear this quite often, and there are two aspects to this. First, TourConnect is always learning and growing, and part of that is learning how to better explain what we do and how to set better expectations for our users. Second, and this is what we are getting better at communicating, is that just meeting a company doesn’t mean bookings magically start flowing. We always have to remember what goes into an agent booking your product.

Here’s a little visual we put together around the B2B sales process:

TourConnect’s PartnerFinder acts a little like an online tradeshow. We provide you a way to meet a new partner; however, that’s when you have to start selling! Here are a few notes:

  • Once you’ve met a partner, you need to get buy in from the product manager or agent on a particular product they want to sell. Remember, this can often take a long time - even years…as product managers are constantly doing research on putting together great itineraries and managing when they release these offerings to the public.
  • Next, you need to ensure you agree on the commission or nett rate for that product, and that your new partner has access to your rates (either through dynamic rate channels or through a static contract). This can be via a channel manager/booking system or through wholesalers/inbound tour operators.
  • From there, the partner needs all of your product information so that they can showcase the product (descriptions, images, videos, etc.). Remember, beautiful images and great descriptions can really impact bookings.
  • Finally, all of those first few steps are important, but if you don’t train the actual front-line agents on how to sell your product…you’re not going to see a lot of bookings. The front-line agents are the ones talking to the travelers…if they don’t know about your product or don’t know how to sell it, you’ll have a tough time generating bookings. Hint: Remember, agents also set expectations for the traveler…so make sure they are selling your product to the right type of travelers and that travelers know what to expect before they arrive.

So, remember, while meeting a new partner is great - whether a connection on TourConnect or a business card at an industry event - if you don’t put the effort in to make it easy for your partner to sell your product, you won’t see bookings.

Thanks everyone! This was our first AMA, and we’re excited for this to be the start of a great resource for our industry. We know the questions and engagement will grow over time, so I’ll be doing these quite regularly. I look forward to answering more and more questions in the future!

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