Yourttoo’s Jesús Pérez Martín: “It’s important to shine the spotlight on service providers because there is always a difference between DMCs”
Interview #2 with Jesús Perez, Co-Founder of Yourttoo
We spoke with the co-founder of Yourttoo Jesús Pérez Martín. For those of you not familiar with Yourttoo, they created a ‘marketplace’ platform for travel agencies to connect to Destination Management Companies (DMCs) and other product providers, letting them build customised tour packages from a wide-ranging and transparent inventory.
Jesús Pérez Martín is the co-founder of Yourttoo. Prior to creating the company, he also started Travel Sense SL, and openmarket.travel. He has over 24 years experience in the tourism industry, working in various functions from tour operator director, product manager and beyond. He holds an Executive MBA from IE Business School.
Turbulence: What is Yourttoo?
Jesús Pérez Martín: In a nutshell, Yourttoo is a multi-day trip consolidator, connecting travel agencies with inbound services operators (also known as destination management companies, or DMCs) who provide various products and inventory.
We stand alone in the B2B space. On the one hand, because there are no other consolidators at present offering these multi-day products (product aggregators usually offer traditional services such as hotels, rental cars, one-day activities, flights, cruises and so on). On the other hand, our model is different from that of a traditional tour operator: we’re more like a marketplace platform. That means that our clients extend beyond just agencies and tour operators and that we’re not bound to a particular supplier or a limited group of receivers or DMCs.
Before taking a deeper dive into your business model and your distribution model in particular, what is a multi-day product exactly?
It is a package that, at the bare minimum, features a night at a hotel, an activity and a journey. Under the umbrella of this concept, you’ll find everything from a city break with transfers and excursions included, to a cultural tour of European capitals for two, or a solo road trip across the United States with a hire car. The minimum length is two days, and the maximum is 25.
Who are your clients?
We try to cater for all the players in the travel distribution landscape and not just travel agencies (albeit they still account for the bulk of our client base). This group includes OTAs, offline travel agencies, travel agency management organisations, tour operators, fellow consolidators, software companies and so on.
What about your suppliers?
As I noted earlier, they’re mainly DMCs. One of the things that set us apart is the fact that we don’t work with a single DMC; rather, we draw together DMCs from all over the world.
We’re unique in this sense when you consider how fragmented the inbound services market is (only a DMC of a significant size can give you 40 packages, say, and even then they will only cover a particular market). Our platform currently includes over 500 of the 20,000 DMCs that exist across the globe.
What added value do you give these DMCs and other receiving parties?
For one thing, their products gain exposure among all the clients who make use of our platform. For another, we’ve created an extranet featuring a programme (which they can also enable on their websites) allowing them to quickly and intuitively upload content. Many operators with 30 or 40 packages use relatively basic technology. With our platform, though, they can, for example, post an eight-day trip in 20 minutes. All the data are digitised and stored in our database (which now includes more than 2,000 easily integrable trips that can load into other channels via XML feeds).
And what about the demand or client side?
On the other hand, we offer travel agencies and other players more than 2,000 multi-day products from more than 500 DMCs and give them transparent information about the operators providing these services at the destination. Another advantage we offer travel agencies is the ability to register on our page, buy trips and combine them with other products, such as hotels from Hotelbeds or air travel, alongside our tours. Agencies can save up to 15% depending on their choice of package. In other words, they can define their sales prices and margins, and increase their profits.
This transparency regarding the identity of DMCs, i.e. the providers of the end products, isn’t typical in the industry.
Before now, the tendency has been to shroud the provision of ground services in secrecy. I find it relatively common for an end customer who buys a trip, whether at an online travel agency or a bricks-and-mortar one, to know that they’ve bought the package from a tour operator like Travelplan, but to be in the dark about the provider of the product at their destination. What I can’t wrap my head around is the travel agency themselves not having this information. I think it’s important to shine the spotlight on service providers because there is always a difference between DMCs. That’s why our model involves displaying not only the DMC’s name in each listing but also their track record, among other things.
And don’t you run the risk of agencies cutting out the middleman (i.e. you) and dealing directly with the DMC?
It is a risk, but it’s one we’ve got to live with because this transparency is part of our DNA. Fortunately, in practice, it’s not a problem. It’s true that there have been occasions when a DMC has contacted us to tell us that such and such agency has approached them directly about a Yourttoo programme. In those cases, we talk to the company and explain to them that we’re not a directory. In any event, any agency that takes advantage of our services and bypasses us certainly isn’t the sort of company we want to work with.
What is the size of your target audience?
Where travel agencies are concerned, we’re looking at the 5,000–6,000 independent firms there are in the Spanish market. Our tool gives them a great opportunity to better compete along the major verticals since ultimately the price is up to them — they decide whether they want to earn 12%, 13%, 14% or 15%. That’s also what sets us apart from traditional tour operators, who demand a retail price and charge a commission on top of that.
I imagine that many of the travel agencies you target hold a bigger presence offline than online.
Yes, and that’s why in March we launched a similar solution to Traveltool’s itinerary service, giving agencies a free subdomain so that they can have a page with their name on it. This service includes the more than 2,000 trips we offer, plus a booking engine and POS, allowing their customers to book online (or, if they’ve already got a site, they can add our solution to it). Additionally, the tool enables them to customise all the documents sent to end customers (e.g. quotes, itineraries, booking summaries, service vouchers and automatically generated invoices).
What about online travel agencies (OTAs)?
We recently rolled out XML/JSON integration so that OTAs like Destinia, who are integrating our product, can have access to more than 2,000 multi day trips. We give OTAs the opportunity to diversify their product portfolio, which tends to focus on hotels, flights, car hire and one-day activities, by adding multi day trip products and strengthening their positioning for holiday travel.
Moreover, it’s not only that your business model sets you apart from tour operators: you actively want to attract them to the platform as customers.
That’s right. For example, right now we’re looking to replicate our model in Latin America and give small and medium tour operators over there access to our more than 2,000 trips. Also, we want to offer them a technological tool (a sort of white-label Yourttoo) enabling them to embed their logo, register the travel agencies they work with, create white labels for their agencies in the country and integrate with other offices via XML.
You mentioned Destinia as an example of an OTA. As it happens, in July the news broke that TOR Travel, Destinia’s B2B platform, had invested in Yourttoo. How did this investment come about and what implications does it have for you?
We had embarked on a capital expansion programme, and my partners hit it off with some people from the group during the Tramuntana Tech Talk event, which took place at the Fundación Bit — the incubator where we’re based. Our project struck a chord with them.
As for the impact, I’d say that it’s significant. Destinia is a colossus that we can learn so much from, especially with their expertise in the online world and their status as one of our primary distributors. On the other hand, we’re also a good fit for them because, although they already had multi-day suppliers, we offer them a much more global solution.
On top of that, there is the TOR Travel angle: by buying Transhotel’s technology, they have established themselves as a consolidator of hotel beds, flights and technological tools. Naturally, we’re also interested in integrating our trips with them, so they can make them available to their travel agencies.
Broadly speaking, what are the biggest challenges (or trends) in the travel industry right now?
First and foremost, I’d highlight the major increase in the consolidation that is taking place in the market. Where the outbound hotel industry is concerned, companies like Booking.com and Expedia are making it very difficult for many OTAs to compete, while when it comes to bed banks, Hotelbeds’ takeovers of Tourico Holidays and Kuoni’s GTA are another clear example of these mergers and acquisitions.
That’s why, when it comes to the hotel industry, in particular, I think it’s highly unlikely that we will see any more companies emerging that sell just one sort of hotel or flight (although there is always room for surprises). I say that because we’re talking about a highly mature market in which you need real contracting and selling clout to thrive, and these days consolidators like the Hotelbeds group hold power on the contracting side and OTAs like Booking.com rule the roost on the sales package side.
Lastly, could you tell us a little bit about your background in the travel industry and how you ended up founding Yourttoo?
I started out at Unijoven, a wholesaler that was part of the Meliá Group, who offered trips around Europe for a niche market of 18-to-35-year-olds, including night-time bus journeys. At the peak of my five years there, almost 100,000 young people per year travelled with us.
Next, I moved to the Barceló Group with the aim of replicating the model. I spent two years at their ViajaJoven unit, where we reached break-even, but Barceló scrapped the project, so I decided to set up an inbound agency with some partners in the US. Shortly after that, Unijoven separated from Meliá, and I returned to my first company.
Unfortunately, eight years later the company went bankrupt. During the insolvency proceedings, I got to know the Globalia Group and the new managing director of Travelplan, Pepe Duato, who offered me the chance to join him in Palma in 2001. While there, I worked on the long-weekend and special-events products, before later launching their European tours and becoming the Product Owner for International and the Caribbean. In 2010, Pepe Duato left to become the new CEO of Orizonia and asked me to go with him and oversee all of the company’s tour operator products.
However, in 2013 I decided the time was right for me to start my own business. I embarked on a project — one that was different to today’s company –, invested my savings into it, rasing around €500,000 through several rounds. Eventually, in July to August 2015, we pivoted to form what is now Yourttoo.
Originally published at www.kantox.com on September 14, 2017.