Travala.com Report Q3 2021
Leadership In Travel Innovation
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A Note From the CEO
The travel world is changing at an incredible pace.
It is hard to overstate how big a challenge Covid-19 has been for our industry. With signs of recovery increasingly starting to take hold, we are witnessing a staggering amount of transformative innovation rising out of the ashes of the pandemic.
Even with the last years being the most challenging on record for the travel industry, Travala.com has grown exponentially as the rise in cryptocurrency adoption has more than offset the negative impact of the pandemic. We posted another record quarter in Q3 2021, driven by explosive growth in our three core verticals of hotels, flights, and activities.
The continued improvement of our booking platform played a major role in our success this quarter. Our growing development team has made significant improvements to the speed and relevance of search results, as well as upgrades to platform security and infrastructure.
We will continue to invest heavily in the growth of the platform to continue expanding our reach and improving the travel booking experience for crypto travellers around the world. But we have also been inspired by all the innovation we see around us, and it has us thinking…how can we do more?
How can we capitalize on Travala.com’s success to have an even greater impact? And how can we do that in a way that supports our growing community and leverages the largely untapped potential of blockchain and cryptocurrency in the travel space?
We took our first step towards decentralization in Q3 by introducing the Community Pool and Community Vote. Our first proposal was approved by a landslide, and we were thrilled both by the level of engagement and the overwhelmingly positive response.
We are also hard at work on a new concept of “proof-of-travel” NFTs, the outcome of the first community proposal. We believe we are perfectly positioned to adapt crypto innovations to the travel world, and this is just the first of many exciting projects to come.
We are very proud of these initiatives and the rest of the work we accomplished in Q3. Thank you for taking the time to read this report—we hope you are as excited as we are for what comes next.
Juan Otero, CEO
Travala.com achieved its highest quarterly revenue ever, driven by rapid growth in the core hotel, flights, and activity verticals.
Total revenue for Q3 2021 was $9.8 million, comprising hotels, flights, activities, concierge, and integration fees. This represents 651% growth over the same period in 2020, and while growth over the previous quarter was only 0.3%, a breakdown by vertical demonstrates that our core verticals performed extremely well.
Hotels and flights grew nearly 50% each from the previous quarter, while activities grew over 70%.
The growth in these verticals was offset by a decline of 55% in bookings through our concierge service. An extremely successful Q2 driven by several major bookings was the reason for the decline in growth, rather than an overall decline in the business. In fact, the number of active concierge clients doubled in Q3, and the number of bookings grew 59%, meaning this line of business is well positioned for future growth and more robust than ever.
Each of these verticals is discussed in more detail in the following sections.
Hotel bookings were the strongest performing travel vertical for Travala.com again in Q3 2021 and remains a focus for us heading into Q4 2021 and beyond.
In Q2 we made substantial improvements to the search functionality and the user interface on the Travala.com platform. While this work continues, part of the hotels growth in Q3 can be attributed to the marked improvement in our core booking product:
- Increased search speed to reduce time needed for booking queries;
- Improved the relevance of search results, particularly for less popular destinations and outside major cities;
- Fully integrated Zendesk to improve the speed and quality of customer support, resulting in reduced refund rates and improved customer satisfaction.
We did see a small drop in hotel bookings in July, as well as an increase in refunds. Both decreases can be attributed to the uncertainty around the Covid-19 Delta variant in many key travel markets.
However, this downturn was short lived, and bookings recovered in August. Based on the events of the last few months, we’re seeing that travellers and countries (or regions) are still sensitive to Covid-related news and travel policies. But compared to last year, and as evidenced by the quick recovery in August, we believe people are increasingly comfortable with returning to travel—and we want to help! To streamline the return of global travel, we’re evaluating solutions that will provide travellers with easy access to accurate information about travel restrictions and Covid-related requirements directly on our website.
The flights vertical had its strongest quarter yet, which we believe is the result of an improved product and travellers’ desire for longer-haul trips after months—if not years—without international travel.
This was the first full quarter with the backend integration work complete which, along with the improved search functionality, helped drive Q3 flight bookings growth. We have some exciting developments on the horizon as well, with work currently progressing on multi-destination bookings and flights within the Binance Mini-App.
Further to this, merging the backend systems will facilitate the sale of travel packages, which are expected to go live in Q4. Allowing customers to book hotels and flights together will help each vertical support the other’s growth. See below for more details.
Our activities vertical showed strong growth in its second full quarter. The number of activities booked almost tripled over the previous quarter, indicating that Travala.com users are increasingly aware of their availability on the platform and are often booking activities on top of hotels or flights.
We see activities becoming an important part of our offering as we further develop the product. The vertical also forms an integral part of our packages strategy, and in the longer term, activities are a key offering which will bring us closer towards our goal of becoming one of the world’s leading digital travel companies.
Our activities partner is Viator, which boasts the world’s largest selection of high-quality experiences and is part of the Tripadvisor family.
Travala.com Packages are almost ready for launch! We had initially hoped to release this product in Q3, but decided to spend a bit more time on development and we’re thrilled with the result. We’re looking forward to activating Travala.com packages in Q4.
Packages will allow travellers to build their own dream vacations within the Travala.com platform, mixing and matching hotels and flights and booking everything seamlessly in one place.
Our concierge service was created in Q2 2021 in order to provide a higher level of personalized, premium service to select luxury and VIP customers. We started strong with a handful of significant bookings that played a large part in the creation of the service itself.
Despite seeing a dip in total booking value, the concierge service progressed significantly in Q3. The number of concierge customers doubled, which resulted in a 59% increase in the number of concierge bookings made compared to Q2. We also launched our concierge membership program, which allows VIP customers to get access to our team of experienced travel specialists upon payment of an upfront membership fee, which can be applied to travel bookings in full.
If you are a frequent traveller looking for a more personalized level of service, or know someone who is, we would love to hear about your travel aspirations. Our team is always standing by and can be reached at [email protected] or on the live chat.
Monthly Active Users (“MAUs”) is a key performance indicator that refers to the number of unique users who interacted with Travala.com over a given month.
Average MAUs in Q3 grew 22% over the previous quarter, including posting new single-month records in August and September. This is the second strong quarter in a row after similar growth in Q3. These figures include users of the Travala.com website, blog, and mobile apps, each of which grew average MAUs in Q3.
This steady rise in users demonstrates the effectiveness of our marketing and social media strategies, as well as the ongoing strength of the Travala.com community. We expect this to drive consistent growth in our core verticals in Q4.
AVA continued to be the top payment method for hotel bookings in Q3 overall, though it was surpassed by Binance Pay in September.
*Binance Pay supports payments in over 30 cryptocurrencies.
We previously highlighted how significant the Binance Mini-App integration was for Travala.com and for the crypto community in general. The Mini-App enables customers to pay with a wide basket of cryptocurrencies directly from their Binance exchange wallets. This has grown quickly to drive more bookings than any individual token, and we expect to see this trend continue. One of our major strategic initiatives is to integrate our mini-app into more exchanges and metaverses, and this rapid adoption of Binance Pay reinforces our ambitions in this area. Our broader mini-app initiative is discussed in more detail below.
With respect to single cryptocurrencies, AVA is again the top payment option, followed by BTC. There are considerable advantages to paying with AVA, including additional discounts above and beyond the Smart Program incentives described in more detail below. To learn more about the AVA token benefits and use cases, please see our website (LINK).
We strive to provide as many booking channels and touchpoints as possible in order to optimize user experience and drive better engagement.
While desktop bookings currently remain the preferred option, there was a clear shift towards the Binance Mini-App in Q3 2021. 10% of September bookings by volume were made through the Mini-App, with total Q3 Mini-App bookings sitting at 8% of overall bookings for the quarter. This is up from 5% in Q2, indicating that a greater proportion of growth was driven by Mini-App bookings than by desktop bookings.
We worked hard on improving the core platform and booking infrastructure in Q3. We have been on an aggressive recruitment drive and have added several top-quality hires over the last quarter, particularly to the engineering and customer support teams. Our development team headcount grew by 23% in Q3, and we are targeting close to 50% additional growth in Q4.
This resulted in a number of significant improvements to the platform, including:
- Improved booking search, both with respect to the speed and relevance of results, as discussed in more detail above;
- More robust reporting capabilities, allowing us to better understand and grow the business;
- Significantly enhanced security, including improved auto defense to protect from DDos attacks, increased protection for customer information, and running security audits and tests to identify and address platform vulnerabilities.
Our development goals for Q4 reflect the shift in focus towards innovation and decentralization.
Our top focus will be to launch the “proof-of-travel” NFTs, as voted for by our community. We are currently still in the program design phase, but are devoting a lot of resources to this as a priority. Once the program has fully taken shape, we will develop the NFTs themselves.
Our direct contracting initiative is the next priority on the innovation list. To do this, we will integrate with suppliers and build the necessary functionality into our search and order engine. We’ll also work closely with suppliers to ensure the product benefits these important new stakeholders.
We will not lose focus though on the continued improvement of the core booking platform and its underlying infrastructure. We have a number of major speed and performance upgrades in the pipeline, as well as improvements to UI/UX across all products to provide our users with a seamless booking experience.
We will also finalize the development of the Travala API and begin to integrate our mini-app into more partner exchanges and metaverses. Lastly, we will complete our wallet infrastructure upgrade which will support BEP2, BEP20, and ERC20 tokens while enhancing security and reporting capabilities.
AVA Token Updates
The Smart Program continues to provide exceptional value for its members through travel booking discounts, givebacks, and invite program rewards. We know our strength lies with the community, and we are grateful for your continued confidence in the vision for Travala.com and AVA.
As of October 1, a total of 8,574,750 AVA has been locked, representing ~17% of the circulating supply. During Q3, 44,438 AVA tokens were issued for standard booking givebacks, Smart loyalty and invite program rewards, which was equivalent to US$155,248. This represented an increase of 145% in USD terms from Q2 2021.
Travala.com experienced very strong growth over the past 18 months, which we are particularly excited about given the challenges the travel industry has faced.
In order to take full advantage of our momentum, we have taken the first steps towards implementing decentralized AVA token governance through the introduction of the Community Pool and Community Vote.
Since August 2021, 30% of all net revenues from Travala.com are now converted to AVA and added to the Community Pool on a monthly basis. We are taking a longer term view by giving AVA holders the power to determine how Travala.com will be built going forward for the benefit of the community. The tokens will be used for initiatives that expand the AVA token’s reach and create more diverse use cases, which we expect will benefit the Travala.com platform as well as AVA.
The Community Vote was introduced in parallel with the creation of the Community Pool. Smart Program members now have a direct say in the use of the funds held in the Community Pool via a voting mechanism on the Travala.com platform. Initially, Travala.com management will propose strategic initiatives for AVA allocation from the Community Pool, and Smart Program members will vote on those proposals.
The first proposal was for the creation of an NFT Program, which was approved by the community with 89.6% of voters in favour of the proposal. More details about the NFT Program are included below. We are developing several other proposals for the Community Vote and are looking forward to pitching the next proposal in Q4.
An ERC20 version of the AVA token went live in Q3, and a swap was executed to create liquidity on the Ethereum chain. AVA is now available on BEP2, BEP20, and ERC20, expanding its availability to a wider range of users and potential future use cases.
There is also work being performed on a new wallet solution to support all three versions of AVA, as well as BNB and BUSD. Once the new wallets are in place, Travala.com users will be able to hold all versions of these tokens in their in-platform wallets and use them to pay for bookings. The new wallets are expected to go live in Q4 2021.
AVA Token Burn
The 7th and final quarterly AVA token burn was completed in July. 101,292 AVA tokens were burned, equivalent to US$196,505.62 worth of tokens at the time of the burn.
The first proposal put forward for the Community Vote was to develop and launch a travel-specific NFT program. The initiative was announced in early September. Voting was live from September 14–16, and the response was overwhelmingly positive, with 89.6% of the votes cast in favour of the proposal.
We have since been working with an external agency on devising a more comprehensive NFT strategy paper, developing the program details and mock-ups of the UI/UX as well as the NFTs themselves.
The first item on the NFT program roadmap is allowing Travala.com users to claim NFTs as part of a new “proof of travel” concept. Proof of travel is a blockchain-based record of a person’s world travels booked via Travala.com. The program serves to incentivize use of AVA for booking travel on Travala.com and to maintain Smart membership status.
More broadly though, we believe there are some novel and very interesting use cases for NFTs in travel, and we’re excited to share more about our plans in the coming months.
The Mini-App Program
Travala.com has designed a mini application (“Mini-App”) that can be integrated into top-tier cryptocurrency exchanges, wallets and metaverses, allowing instant booking through existing wallets. The first integration of the Mini-App was completed in Q2 2021 with the world’s leading cryptocurrency exchange Binance.
On the back of our success with Binance, we have been developing an API which will allow other exchanges and metaverses to integrate the Travala.com Mini-App into their own platforms. We have already received interest from a number of other partners to integrate the Mini-App, and with the API nearing completion, we expect it to be deployed with our second partner in Q4.
As mentioned in our last quarterly report, we believe the Mini-App will be a game changer for Travala.com as it significantly increases our distribution capabilities and brings us even closer to potential customers. This continues to be an important focus for our development efforts.
Travala.com is on a never-ending quest to offer the most high-quality travel products out of any Online Travel Agency (“OTA”) in the world. This is why we are constantly expanding our offering of hotels, flights and activities by partnering with leading travel suppliers.
Our most important strategic focus in Q3 was on furthering the establishment of direct contracting links with our suppliers. Initially focused on hotels, our direct contracting initiative will allow us to connect directly with suppliers rather than accessing inventory through third-party aggregators. This has a few significant benefits:
- Margin improvement: by eliminating the need for a third-party aggregator to sit between Travala.com and our suppliers, we can earn higher commissions on bookings while also passing on a portion of these savings to our customers.
- Collaborative promotion: connecting directly with suppliers will allow Travala.com to collaborate on property-specific promotions, including the use of AVA to drive customer loyalty programs and reward suppliers for providing inventory to Travala.
- Customer service: while Travala.com will continue to provide support for all our customers as needed, direct contracting will empower customers to connect directly with the properties they visit, allowing for faster, more personalized customer support.
We are still developing our direct contracting capabilities, though we expect to go live with our first direct suppliers in Q4. This is expected to lead to some promising opportunities to use blockchain to transform the supply side of the travel industry. Stay updated on our social media for more announcements coming soon.
Travala.com partnered with several amazing token communities in Q3, including the likes of KLV, OM, SUPER, VIB, CHR, XVG, FUN, and KISHU. Each community can now use their tokens to pay for millions of travel products, including hotels, flights and activities.
As part of the concierge offering, token communities can now book corporate travel services, such as company retreats and business trips. See here for more information (LINK).
Travala.com is quickly establishing itself as the premiere travel partner for an increasingly wide range of blockchain and cryptocurrency-focused events, including:
- Block World Tour: 2-3 September in Montril, Spain, and additional events on the circuit
- Token2049: 7-8 October in London, UK
We are in advanced discussions with several other events and conferences and will be announcing more of these partnerships soon.
Other Strategic Partnerships
In addition to event partnerships, Travala.com entered into two other new strategic partnerships in Q3.
HASSRA Membership Integration
HASSRA is a UK-based organization that provides a first-class program of competitions, activities, and benefits for its members, with the goal of helping members to achieve a healthy work-life balance and wellbeing in the workplace. Under the new partnership, HASSRA members will receive access to travel discounts on Travala.com.
Verge and Fuelled by Verge
Travala.com is a sponsor and official travel partner of Verge (XVG) and their Fuelled by Verge program. Fuelled by Verge is an initiative to educate and spread awareness of blockchain technology through partnerships with athletes and sports personalities, as well as showcasing the utility of Verge through community events.
Q4 Travel Outlook
The travel recovery continues to be dependent on region and is heavily influenced by Covid-19 case numbers and vaccination statistics. In the US, which had a significant resurgence in Covid-19 cases in Q3, travel spending declined 11% to $92 billion in July after having steadily improved since January 2021.
The US is starting to relax international travel restrictions, however, recently announcing they will open their doors to fully vaccinated foreign visitors in November. Australia, which imposed one of the strictest bans on international travel in the world, has similarly started to ease restrictions for Australian citizens, with international travel expected to open to certain countries in November. Pent-up demand for travel is still huge, and as restrictions continue to lift, the travel industry will inevitably continue to recover over the medium and long term.
Regions that have the pandemic under control and are open for business are already benefiting from this demand. More travellers are taking advantage of work flexibility by spending extended periods of time on “workations” in Covid-safe destinations, typically locations that offer interesting history and culture or a comfortable and relaxing lifestyle.
At the opposite end of the spectrum, travellers not interested in working remotely are increasingly travelling solo and local. Millennials were already starting to favour local travel and “staycations” prior to the pandemic, and the increased desire for safety and sanitization has now made local travel more appealing for a wider range of travellers.
All of this informs our strategy at Travala.com. We are continually increasing our travel inventory and exploring new partnerships. Discussions are underway with both local boutique hotel chains through our direct contracting initiative and remote, work-friendly travel providers catering to workationers. Ultimately, we continue to believe that the majority of trips for the remainder of the year will be domestic, with higher value and longer-term trips than in the past as travellers reallocate their budgets to local options.
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