Why Most Travel Planning Startups Miss the Mark — 5 Things To Consider Before Building A Travel Planning App

Trip planning startups are once again the subject of lively debates, this time fueled by a new wave of AI-powered solutions. On one hand, entrepreneurs persist in their efforts to improve the trip planning process, fully aware of the many predecessors who have attempted and failed. On the other hand, seasoned travel professionals argue that trip planning is not fundamentally problematic, as evidenced by the current graveyard of trip planning startups.

What’s striking is that both sides recognize the current way of planning trips is cumbersome and inefficient. Yet, the common argument against these startups is that people enjoy planning their trips. I think it’s important to remember that many of these startups are founded by travel enthusiasts who themselves love to plan trips but have personally encountered pain points firsthand. As much as consumers enjoy planning trips, no one enjoys needless friction and they would welcome a solution that genuinely improves the existing trip planning experience.

Travel planning apps try to simplify complexity, but it’s harder than most people think.

I believe past solutions simply failed at providing a better experience (trying to replace the planning process rather than improving it) and it can be attributed to a combination of poor understanding of the real issues and inadequate product design, all compounded by a challenging market environment.

👇 My thoughts below:

Part 1: Why People Plan Trips

When I try to approach trip planning from first principles, my first question is: What motivates so many travellers to meticulously plan their journeys and what are their desired outcomes? In my opinion, there are 3 primary drivers behind the urge to plan a trip:

1. Access and Cost-Effectiveness: Travelers plan to secure availability and best prices. Booking in advance often ensures both.

2. Fear of Missing Out: Many travelers visit a destination only once and want to make sure they see all the important things. Nothing is worse than the feeling of realising you missed out on key sights and activities after you get home.

3. Maximizing Enjoyment (the most important in my opinion): most people travel 2 to 3 times a year. Since travel is infrequent and a high stake purchase, they want to make sure every trip is worth it. Planning helps in several ways:

• Making the most of the trip: Time optimisation allows travellers to see and do as much as they possibly can
• Peace of mind: By handling most logistical aspects before departure, travellers can relax and enjoy their experience without the stress of last-minute arrangements
• Informed Decision-Making: Conducting thorough research helps manage expectations, tailor experiences to personal interests, and minimize potential disappointments

Part 2: What Does The Typical Trip Planning Process Currently Look Like?

The typical trip planning process is often outlined by the industry in the following stages:

1. Inspiration: You are constantly in that phase. Every day, you get served with travel content relentlessly whether through ads, TV shows, social media posts, or conversations with family and friends. It’s a constant call to start planning your next getaway which leads you to start creating your bucket list, though you haven’t necessarily decided on your next destination yet.

2. Research / Discovery: You’re nearing the burn-out at work and realise it’s time for a holiday. You actively explore your options, gather information and narrow down your choices. You prioritize destinations based on personal interests, budget considerations, and time constraints. You might spend hours switching between different websites to gather information. This leads to the most commonly used problem statement in travel start-up pitches: “Travelers visit 38 different websites on average to plan their trip” (Traveltech entrepreneurs love Expedia for this precious piece of research!). By the end of this phase, you have chosen a destination and have a rough understanding of what to expect, along with unorganised notes scattered in your phone or on scraps of paper.

3. Planning: Now, you start putting together the details of your trip. You take the information gathered during the research phase, collate the pieces together and organize them in what is commonly called an itinerary. This process involves lining up activities and logistics in a logical sequence, balancing what you want to do with your time and budget constraints. An itinerary is often the result of hours of iterations and comparisons as you fine-tune each step (”What if we fly out on Monday morning to enjoy one extra day?”, “I am not sure we should stay 3 days there, let me check what else we could do around”, etc.).

4. Booking: This step is straightforward. Once your itinerary is set, you book your flights, accommodations, and any other necessary reservations to finalize your trip plans.

Part 3: Is Trip Planning Even a Problem to Be Solved?

Opinions vary, but many agree that a significant number of (most?) travellers actually enjoy planning their trips. Some studies suggest that the anticipation and planning phase can be as fulfilling as the trip itself. Here are a few reasons why:

• Researching a destination allows you to explore its beautiful landscapes and unique cultures even before you arrive. This is a form of virtual exploration that adds to the excitement and anticipation of your journey

• Trip planning can feel like a treasure hunt (”What if on website #17, I find this hidden gem that nobody else is talking about?”). This search triggers a rush similar to scrolling through social media, where the next discovery is just a click away.

• The process of putting all those pieces together is intellectually engaging and once completed, it brings a sense of achievement and satisfaction

Is it a time-consuming process? Absolutely. Isn’t this process messy and fraught with friction? Totally. Then the natural conclusion for many entrepreneurs is that trip planning is broken and needs fixing. But few take the time to deeply understand why travellers are willing to endure the hassle of visiting 38 different websites. Below some thoughts:

• No existing website provides a complete, reliable source of travel information. Most travel websites are designed for conversion, not to make your life easier. They push you to browse through endless lists in the hope of making a sale. As a result, you hop from one site to another, continually searching for new information until the next website does not teach you anything new and you feel you have a complete understanding of all your options. The only standalone product that will provide you with this confidence that you are getting a comprehensive view of your destination without necessarily having to visit another source remains the traditional guidebook. This reliability is the result of years of dedicated effort to ease the traveller’s research burden and establish a trustworthy brand.

• Travelers feel compelled to cross-verify information to confirm its reliability. Additionally, gathering different perspectives is important to build confidence they are making the right choices. And while we hate reading the same stuff over and over again, repetition from multiple sources reinforces the idea that a place might be of particular significance and should probably not be missed.

Based on the above, it seems like a successful trip planner would need to:

1. Preserve the enjoyable aspects of trip planning
2. Offer comprehensive and reliable information to eliminate the need for other sources (otherwise you become website #39)
3. Streamline the process to reduce friction and enhance user experience.

And, of course, it must also find a way to make money, but that’s a topic for another discussion.

Part 4: Why I Think Trip Planning Start-Ups Have Struggled to Gain Traction

Over the past decade, numerous start-ups have attempted to revolutionize the travel planning process without success. The typical solution is a web / mobile app that combines 1) curated or user-generated content (like articles and points of interest on a map), 2) search & filtering capabilities for easier discovery and personalisation and 3) planning features (such as saving and organizing by day).

Here is my take on where they fall short (focusing here on the product itself):

• Relying exclusively on user-generated content: It can take years to amass a comprehensive collection of points of interest, especially without strong incentives for users to contribute. Result: the content often isn’t comprehensive enough and users treat the product as website #39, where they might pick up a few tips and then leave. A variation of this is an app built around friend recommendations since it is the most trusted source of information a traveller could possibly use. However, this requires a critical mass of friends who 1) are using the app, 2) have travelled to your intended destinations and 3) spent the time to comprehensively cover those destinations with their insights. It seems like a lot of conditions to be met before new users can get any value out of such a product.

• Not providing contextual depth: Simply displaying collections of places as lists or map points without context is hardly enough. Travelers want to grasp the essence of their destination and this is actually part of what makes trip planning time-consuming (“What makes this place unique?”, “What are the vibes?”, “What should not be missed?”, etc.). Without providing deeper insights and answers to these questions, users inevitably seek information elsewhere

• Imposing a rigid way to plan: Each traveller has a different way to approach trip planning and by forcing them to organize their plans in a specific way rather than adapting to their natural planning styles, they are creating more friction than they are removing.

Significant market challenges further complicate the picture:

1. User acquisition is highly competitive and expensive. If you don’t have a unique cost-effective growth strategy (community, virality on social media, strong brand, etc.), you’ll be competing with the big guys on paid advertising. Guess what, Booking spent $6.8bn in marketing alone in 2023. Good luck competing with that!

2. Established travel companies have built brand loyalty over decades. Gaining the trust of consumers to the extent that they’re willing to share their credit card details with a new platform is an uphill battle. This leads me to believe that building an all-in-one platform for booking every aspect of a trip is unlikely to succeed as it requires to fight several battles at once and surpass each competitor in areas such as pricing, inventory, user experience, etc.

3. The most common business model relies on affiliation where you get a cut from any hotel / flight / activity bookings you generate (building your own inventory is generally not on the roadmap). Since rates are relatively low as an affiliate (~10%), it requires massive scale (back to challenge #1) and a decent conversion rate (back to challenge #2). On top of that, you are actually competing for user acquisition with the same people who pay you those fees.

A common argument against the viability of trip planning apps is that consumers go on a trip only 2-3 times per year on average and since it’s an infrequent problem, they’ll likely forget about your app. It is total non-sense to me and I’ll give an example. I’m a hiking enthusiast and I probably go on a hike 4 to 5 times a year. One day, I discovered Alltrails. For those who don’t know Alltrails, it is an app providing detailed information, maps, and user reviews for hiking trails and outdoor routes around the world. Pretty simple product if you ask me but it excels at making it incredibly easy to access all the information I need to choose the best trail. Before Alltrails, my only other option was to search through Google and various blogs. Because Alltrails offered immediate value from the first use, it has become my go-to resource for planning hikes. Last time I checked, they had over 45m users worldwide. Be more like Alltrails, delight your users the first time by delivering tangible benefits, and they will keep coming back.

Part 5: Why Simply Incorporating AI May Not Solve Trip Planning Challenges

Following the recent advancements in AI, there is not a single day without the launch of yet another trip planning app. Current AI solutions generally take the form of a chatbot which, after indicating your destination, travel dates and some high level information (you are travelling with your partner, you like museums & nature and you are vegetarian), will generate a day-by-day itinerary with ‘personalised’ suggestions. The most advanced tools even populate a map with all the suggested places.

I see a couple of issues with this approach:

• AI offers this unique ability to generate an itinerary in a matter of seconds. As a result, 90%+ of those AI trip planning apps use the same tagline “Save hours on research and travel planning”. Is it really what consumers are looking for? Because I’m not. I personally want to feel confident that the choices I make during planning will lead to a once-in-a-lifetime experience that I will remember for years (remember the ‘maximizing enjoyment’ driver?). If a product can’t help achieve that, then it might be missing the mark. Takeaway: aim for a more efficient and exciting trip planning process, not a faster one.

• Why even start with an itinerary? Suppose you come across a stunning beach photo from Thailand on Instagram and want to explore what the broader area has to offer. But before you know it, you’re presented with a complete two-week itinerary. Imagine sitting down at a restaurant and being served a random meal before you even have a chance to glance at the menu. That’s how I feel when I use those products. An itinerary is usually the culmination of hours of thorough research, iterations, and adjustments. Suggesting that this entire process can be condensed into seconds is a bit of a stretch. What these products often end up doing is removing an important and enjoyable part of travel planning, which does not seem like a great user experience to me. Takeaway: focus on facilitating exploration first, and let the itinerary formation follow organically as a secondary phase.

• A chat interface works well when users know exactly what they’re looking for. However, when it comes to planning a trip, many users are explorers at heart—they may not have precise queries but rather a desire to discover what’s available and decide what suits them best. Besides, users are generally bad at expressing what they want. Since the quality of AI-generated responses heavily depends on how good and specific the prompt is, I question whether a chatbot is the most appropriate tool for this task. Takeaway: UI plays a critical role and may need to go beyond chat-based systems to better accommodate the exploratory nature of travel planning.

Don’t get me wrong, AI is remarkable and offers the unique ability to converse with unstructured data and generate content at scale. It holds the potential to significantly improve the trip planning experience. But, unless products are adapted to what users truly need and want, trip planning startups will continue to fail, AI-powered or not.

What are your thoughts?