TUI/Musement’s new strategic partnership with Booking.com has the potential to reshuffle the powers that be in tours and activities, especially in Europe. 

Booking.com sent notices to its tours, activities and attractions partners that it is terminating their contracts as of June 30.

“As separately described in correspondence with Booking.com’s Partner Services representatives, we aim to continue to enable you to offer your supply via Booking.com through our strategic partnerships and look forward to displaying your attractions in the future,” the Booking.com notice said in a addition to the termination disclosure. “Thank you for your valuable partnership with Booking.com.”

The contract terminations are a precursor to Booking.com handing the keys to much of its experiences business to TUI’s Musement and eventually additional strategic partners, as announced by Booking.com and Musement this week.

The strategy shift began late last year. Before then, Booking.com had been trying to build its own tours and activities business, anchored by its 2018 acquisition of tours’ distribution provider FareHarbor, and found the competition too stiff, and the build-your-own strategy too tough.

The deal to sign TUI’s Musement as Booking.com first new strategic partner in the experiences sector is a big win for Musement, which may now be able to start to challenging bigger players such as Viator, GetYourGuide, and Klook, especially in Europe.

One factor that possibly contributed to the Booking.com-Musement deal coming together was that Musement would be required to share tours and activities supplier leads with Booking.com’s FareHarbor, a tactic that would be reprehensible to some operators.

Bob Gilbert, formerly head of business development in the United States for FareHarbor competitor Rezdy, expressed similar concerns.

“There were many concerns voiced surrounding the Fareharbor acquisition by Booking.com just over two years ago,” said Gilbert, CEO of Captivation Marketing, which counts Rezdy as a client. “One major concern was the internal sharing of supplier information between the two businesses. That was vehemently denied.”

But Gilbert argued that lead-sharing, after the COVID-19 crisis, is possibly a new strategy.

“I believe tour and activity companies who were skeptical two years ago will be justified in being even more concerned today,” Gilbert said. “My recommendation to those suppliers is to choose your partners very carefully and work with truly independent booking software providers with extensive distribution.”

Asked to comment on Musement sharing business leads with Booking.com’s FareHarbor, TUI spokesman Martin Riecken declined to answer, and instead commented: “We are open to onboarding additional FareHarbor suppliers that are relevant to both Booking.com and Amusement/TUI, and distribute them through our channels.”

Will the transition from direct contracts with Booking.com to pacts with Musement instead include a new business model or terms? Riecken didn’t get into the details. “We already work with multiple partners and intend to contract additional suppliers on the Musement platform and distribute them through Musement, TUI, Booking.com and our other distribution channels,” he said.

Booking.com hasn’t confirmed or denied the lead-sharing arrangement.

Source: Destination Review

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