Spice — Travel Inspiration App
We want to make travel videos economically viable so that people can discover and assess destinations in an easy and entertaining manner
Video Centric Travel Content
Travel video seems to be the obvious thing to be popular and at some point it should take over blog as the most dominant form of medium for introducing/reviewing destinations. Video does a superior job of delivering authenticity, inspiration and tells unique stories relative to photos and texts. Our Youtube channel has strong followings by adventurer-type travel enthusiasts for providing such content.
Yet travel focused creators are struggling to get tractions vis-a-vis those in other lifestyle verticals on platforms such as Youtube for a couple of reasons — 1) travel destination topic is infrequently discussed/searched, 2) travel costs more than other forms of videos, 3) it takes time to study destinations to the fullest thus it’s hard to keep up with Youtube’s preferred content schedule. As such, most travel content creators focus on their personal stories instead of talking about destinations as to push content as frequently as possible (two videos or more per week). Or lifestyle content creators occasionally create travel vlog that get more views due to their followings than travel focused creators regardless of the quality of information provided in the videos. Simply put, current environment is far from fostering organic and self-sustaining travel content creators.
We not only make such travel videos but also want to create the system where such video production is economically viable by overcoming disadvantages you see in other platforms.
Where content funding should come from
Hotel booking is the biggest source of revenue for travel industry. As airlines are in oligopoly, their payouts to OTAs and downstream merchants are generally minimal. Hotel industry is fragmented. Even the biggest international hotel chains cannot fill their rooms on their own. Thus they are willing to pay significant portion of merchandising value to OTAs (Booking Holding, Expedia Group) as well as Global Distribution System players such as Amadeus, Sabre and Travelport.
Right now, this revenue is spread across many players — not only international OTAs and GDS but also traditional travel agencies, hotel pricing and review aggregators such as Tripadvisor, Google, bloggers and travel content farms through OTAs’ affiliate programs. Unfortunately, this money barely goes to fund authentic travel video production although video might have a potential to be far more useful and valuable to people than existing content available on the web.
OTAs takes ~20% off of the booking. Even assuming 10% of the booking value goes to the industry, that’s $60bn a year. That’s 5x bigger than Netflix’s annual budget. If that money goes to fund video production, there will be great catalogue of destinations everywhere in every language. Instead, thousands of content farms are producing the exact same content to get a slice of it. Google inserts itself into the process of booking and takes up huge pie of it without creating any content. It also goes to traditional travel agencies and absorbs their fixed costs.
We aim to change this by connecting hotel booking revenue with video content funding through the app that integrates videos that work as discovery/inspiration and booking.
Frequency of use
It requires a seamless service which flows from inspiration to planning to booking in the app. It also requires more frequent usage than booking services which tends to get used when users plan a trip in order to have an advantage in providing inspiration. Thus the app content must be enough entertaining so that it can get consumed without the context of travel planning, something that gets consumed casually as an idea for the next trip.
Learning culture and skills as a key ingredient for unique travel experience
As is evident in our Youtube channel, particular type of our videos that are popular are educational kinds where we introduce the skills i.e. photography and culture i.e. Japanese food. As idea of travel matures, more and more people crave for trips that caters to their specific interest and appreciation of culture rather than just visiting most stereotypical attractions. By deepening the knowledge of culture or acquiring skills, people can fulfill their demands for unique travel experiences. Not only such content provides learning people are eager for, but also works as a great retention tool.
We aim to amplify this impact through gamification so that users can keep on learning new things.
Great content means both great product and marketing
As media business landscape has shifted, it’s getting harder for media companies to be viable just by relying on monetization through banners and links. On the other hand, newer startups with mobile apps or e-commerce platforms also struggle to get traction as it’s getting hard to have an organic reach through popular social channels. Given the backdrop of those, you start to see the wave of companies whose setup is a mixture of in-house media/content production for its owned media and branding together with e-commerce seamlessly integrated in the service for monetization.
Our organization is set up in such way. We have content/marketing team on one hand, and we have engineering team on another with full travel planning and booking features built-in. By having both capabilities, we aim to innovate the form of content that’s interactive and entertaining.
We also iterate on video production in cost effective ways on multiple social channels, of which Youtube being the biggest by far as well as in our own product. Better content on such iteration leads to superior tractions on marketing as well as better retention for the product.
Advantage of distributing through owned media over paid media/cross promotion is evident as our own videos recorded 100+x better conversion over partner cross promotion through ads.