B2B resellers are an important part of the tours and activities sector. These distribute your products to customers you may have difficulty reaching on your own
A business-to-business reseller does exactly what it says on the tin. They will take your products and sell them to other travel companies, who will then sell them to their own customers and guests. An example would be HotelBeds, which takes tours and activities content and distributes it to accommodation providers to sell directly to those staying in destination.
B2B reseller models
Direct and wholesale
There is a range of different B2B reseller models available for tour operators. These include marketplaces, distributors, reservation systems, and channel managers you already use. Distributors will take an operator’s content and provide it to their partners. There will be fees or a commission structure involved for the service, but generally, these are pipes connecting operators to partners.
There are two main distribution options — direct and wholesale. A direct model is used when a commercial relationship exists between an operator and a partner. A wholesale agreement covers those instances where there is not a relationship.
Direct models allow operators and partners to agree on the commercials and inventory provided. The distributor will then provide the connections. A rate on transactions, sales, or a monthly fee can cover this.
For wholesale relationships, commercial agreements will be provided by the distributor, and, in this case, the merchant of record is often the reseller. This will be covered by fees or by a commission on each sale.
Marketplaces, portals and affiliate programmes
Marketplaces, such as the one provided by TourCMS, work differently. Here, the operator provides the marketplace with content that partners can search and resell. These are similar to the Amazon Marketplace but B2B. As with distributors, marketplaces can offer direct relationships or provide commercial agreements. Sometimes, the operator sells directly to the marketplace and then resells the content to interested partners. In this case, the marketplace can become the merchant of record.
Other B2B distributors will provide a portal for agents and concierges to purchase content. These allow the partner to search operator content and sell it to their client, similar to a global distribution system used by airlines. There may be either a fee or commission involved, and the distributor will be the merchant of record.
Affiliate programmes are also in use. Here, operators may provide their content to the program, turning it into trackable links and widgets. These links will be directed to the operator’s site where the sale is made. Commissions are paid to the programme for sales; the operator is the merchant of record.
How to connect to B2B resellers
Medium and large operators
Medium and large operators will likely need channel management to access B2B resellers. There are options to choose from here — a separate channel manager plugs into your reservation system or a reservation system that includes channel management. Assess the quality of each solution and carry out a cost/benefit analysis.
It may be in large operators’ best interest to choose a specialised or custom solution that will begin to meet their exact needs. A single solution may be preferred here, and the integration and mapping processes and a full rollout will take time. Expect a timeline of six months to one year, depending on the number and complexity of products.
Some B2B distributors will enable you to sell more tickets locally through hotels and transport providers. Others will be global and less focused. What is the demographic of the customer you wish to reach, and is that partner capable of reaching them?
Operators should also assess the distribution reach and volume of tickets sold by a partner. This will indicate their scale and whether they can do what you require. This can be discovered by asking the partner, asking other operators who use them, and finally, by testing yourself. Take a trial and turn the partner on — if it doesn’t work, turn them off.
Check is who is the merchant of record. This will affect who is responsible for payment processing, customer service, and how much customer information an operator receives. For example, if an operator has a small customer support team and no wish to remarket to new customers, allowing an OTA or B2B partner to be the merchant of record could be in their best interests.
To assess the quality of API connections, ask the provider about its quality, how well it is maintained, and what is in the development pipeline. How stable is it? What features does it have? What can it connect to? How involved is the provider in setting it up and mapping products? What is the standard of customer service? Again, ask the provider and their clients, and test if you’re satisfied with the answers.
Small operators
Small operators should be conscious of their business model when choosing their connectivity partners — what are you trying to achieve? Are you trying to fill a few extra seats or expand to reach an international audience?
Many new and small operators will only need to connect to B2B resellers later. At first, they should concentrate on making their experiences as good as possible. The technology you use should enable and complement your business.
Once you are ready to expand, operators must ask what problems they want to solve. While a reservation system can become the backbone of a business, it does not need to. If the problem is purely one of a small amount of extra distribution through a few OTAs, then a lightweight booking system that does not focus on B2B resellers could be the solution.
Once a solution has been found, operators should take the time to learn exactly how it works and how best to integrate it into their business. Don’t do it by half. Make sure it becomes efficient and not a chore. What role does it need to play for your company? Make a list, do your due diligence and cost/benefit analysis, and find the tech that solves most of your problems. What role does your distribution technology play?
For example, a smaller operator may like connections to a few OTAs and to direct partners and their websites. On top of that, they may like the ability to schedule pick-ups and have a point-of-sale.
Smaller operators should also remember that online distribution has a cost. It is not that long since hotels lost a lot of revenue because they were too slow to come online, the emergence of OTAs and their new commission structures, and a global travel slowdown.
Operators should avoid this and keep online commission spending as low as possible, with as much return on investment as possible. Ensure you fully assess whether it is the right path for the customer you’re aiming for.
It is likely that there are OTAs and B2B resellers that specialise in your particular type of experience or region, as well as those who sell experiences more generally and all of travel. Be smart and choose the ones most likely to convert the customers you want.