A reservation system is one of the most important pieces of technology for any company working in travel. These come in various shapes and sizes, but they all have the same function — to make it easy to take and manage bookings. Since the end of the last decade, they have become an essential piece of kit for tour and activity operators.
What is a reservation system?
The purpose of a reservation system is to bring order to chaos and replace pen, paper and Excel as a method of managing travel bookings. They are specifically designed to do this and exist because pen, paper and Excel are only up to the task for some operators, even small ones. Reservation systems will connect to most sales channels, organise that information, keep you in contact with your customers and automate many tasks to provide a seamless booking experience for your guests.
Some reservation systems will be lightweight and simple. These will be designed to carry out only the most essential tasks that a tour operator requires, such as taking bookings from an online travel agency and website.
Others will be specialised in specific areas, such as hop-on-hop-off buses or boat tours, and come with a whole suite of different tools. These will operate as a single source of truth for your experience and allow you to manage every aspect of your business, including staffing, dynamic pricing and providing point-of-sale devices. Booking systems such as these will also have a high level of customer service and the ability to adapt to your specific needs.
These systems are known by a few different names. They can be referred to as booking systems, reservation technology, or res-tech if you’re in the Arival group. There is no difference between these. It is just a matter of what a company or technology provider calls them.
Reservation systems aim to help you scale your business. They do this by streamlining the online and in-person booking process for customers, which should increase sales. They will also increase efficiency by automating many processes and reducing customers’ queue time. The system will also present all the data you have in common and easily customisable tables and charts to help you spot opportunities and problems quickly.
What does a reservation system do?
Streamline bookings
A reservation system will streamline your booking process and keep everything in one place. Payments will handled securely and quickly. Those that provide point-of-sale devices will have every booking automatically added to your database, along with those that come through your website and online travel agencies. Online bookings will capture all the information that you require.
Connections to online travel agencies
Most booking systems will have connections to the main online travel agencies. These will enable you to sell and update your products through the largest tours and activities sales channels, such as GetYourGuide, Expedia and Hotelbeds. Travellers can book instantly, payments will be handled automatically, and any changes you make in the system will be changed automatically on the OTA. Those wishing to extend the sales reach of their operation even further should look at the options a channel manager provides.
Efficient, all-in-one management
Once a booking is made, this information will be added to all the relevant locations. If you have a certain number of seats on sale, a booking will reduce the number available across all sales channels. Confirmation and reminder emails will be sent to the guest with no hassle. The information will be immediately added to the relevant dashboards for analysis. Invoicing will handled automatically, with the correct commission rate calculated. There will be fewer mistakes to fix, and staff may be deployed to more productive areas.
Because a reservation system holds all your company’s information and is your single source of truth, it will also make it easy for you to analyse this information. It will give you graphical displays of your sales, margins, locations, and anything else you require. You can drill down into these to spot trends, opportunities and any issues you may be facing.
Your and your customers’ security
The security of your business and your customers should be a top priority for your booking system. It holds all of your information, so you need to be able to trust that the database is secure. It will also handle your payments, which must be reliable, efficient and encrypted.
For the geeks: A history of reservation systems
As with much travel technology, airlines first used reservation systems, then trains and hotels, and eventually, they came to tours and activities. There are good reasons for this: money, sales methods and the nature of the industries.
The first reservation system was built in 1946 by American Airlines. This was part of an expansion policy that prioritised increasing efficiency as much as possible. The Reservisor checked if a seat was available, updated the manifest when a seat was booked or cancelled and recorded the passenger information. It could hold ten days’ worth of flight information.
They had previously been working on paper and had to pull everything from filing cabinets but could now access everything through a terminal. After the first year, American Airlines could handle 200 more passengers daily with 20 fewer operators, and everything could be centralised.
Soon, this was replaced with the Magnetronic Reservisor, a significant improvement, and seat lookups took less than a second. The information stored increased to 2,000 flights over 31 days. By the early 50s, American Airlines’s office took 45,000 calls daily to book flights. The system was modified for other airlines, and larger hotels and train companies started knocking on the door.
At the same time as the Reservisor took off, Americans had started flying their first jets. These increased both speed and passenger capacity. While the Reservisor was a leap forward, it wasn’t good enough to handle this, and as with all new technology, it was still quite buggy. American Airlines started working with the computing company IBM. This led to Sabre — the first successful computerised reservation system still operating today.
The birth of the global distribution system
Other airlines began to develop their own systems. In the mid-70s, they started to give direct access to travel agents and the global distribution system was born. Along with Sabre, The major systems are Amadeus and Travelport. Between them, they handle trillions of dollars in bookings, and all have started distributing tours and activities.
As the world came online in the 90s, so did travel sales. In 1995, the first online travel agency (OTA) was formed — the Internet Travel Network. Airlines were ready, but suddenly, many hotels had far more sales channels than they could cope with. What had been a case of taking a few phone calls from agents and updating the ledger suddenly became more complicated. Guests could search and book through an OTA or the hotel’s website.
Large hotel chains had already developed their centralised reservation systems, but the smaller ones could not. Technology start-ups saw the opportunity and jumped in to fill the gap. In no time, every hotel could centrally manage all their reservations from Expedia, Booking and their website with fewer mistakes.
Reservation systems for tour operators
While tours and activities is the third largest sector in travel, it took much longer to come online. There are fewer large corporations than in the transport and accommodation sectors; most operators handle fewer guests, and many are small businesses. At the same time, tour operators could rely on walk-ups, recommendations and partnerships with hotels, and bookings through agents and destination management companies for much longer.
However, some operators saw the need for reservation systems built specifically for the market. These connected to the operators’ websites and the new batch of experience-focused OTAs and marketplaces that were starting to form — even if much of that work was carried out through an extranet. TourCMS by Palisis was one of the first.