Malaysian travel platform Touristly Travel Sdn Bhd has landed a strategic investment from AirAsia Bhd to receive MYR 11.5 million (about US$2.6 million) for a 50 percent stake of the company.
The acquisition follows an earlier round last August where AirAsia-owned Tune Labs took a 9.54 percent stake in Touristly for an undisclosed amount.
The deal will see AirAsia injecting its Travel 3Sixty digital magazine valued at MYR 6.5 million (about US$1.5 million) into Touristly via AirAsia Investments Ltd, in addition to extending a MYR 5 million (about US$1.1 million) convertible loan to its working capital and development.
AirAsia’s Travel 3Sixty digital platform consists of online advertising assets and other AirAsia online properties, which will provide Touristly access to the company’s 60 million guests annually.
This also includes AirAsia’s offline advertising assets, which includes the physical version of the in-flight magazine, as well as ad placement on the overhead cabins and seat trays on the AirAsia aircraft.
Following the completion of the deal, Touristly’s founder and CEO – Aaron Sarma will lose his majority control over the firm to AirAsia Group’s CEO – Tony Fernandes which will become the chairman of the board.
However, Sarma is still excited about the deal as it would put AirAsia’s 60 million customers a year on the table for Touristly to monetize. Besides, Sarma commented that this is a requirement for Touristly to have the autonomy to execute its business plan effectively.
Moreover, Sarma said that “it is nearly impossible to put a value on the opportunity to serve over 60 million travelers a year with our platform. This is highly qualified traffic with purchase intent which will enable us to scale up at a rapid pace.”
Additionally, the deal will also allow the company to tap into AirAsia’s vast regional network with offices located in major cities of Asia Pacific, helping Touristly to expand its footprint efficiently.
Fernandes, on the other hand, also sees the deal bringing AirAsia a step closer to becoming a one-stop digital airline – as the carrier will be able to offer in-destination tours, activities, and restaurants to its customers.
“We see enormous potential in Touristly, which perfectly complements AirAsia’s existing travel offering. Our guests will be able to choose from thousands of activities when purchasing a flight and this brings us a step closer to become a truly one-stop digital airline,” said Fernandes.
“With the trove of AirAsia customer profiles and data sets coupled with Touristly technologies, the Touristly platform can offer more targeted offerings that match the customer’s lifestyle and travel aspirations, for instance, adventure travel,” he added.
Previously, both parties have already witnessed the results of their collaboration over the last nine months where Sarma notes that there were high conversion rates when selling on-ground activities to AirAsia flyers with an average expenditure of MYR 813 per flyer.
Founded in 2015, Touristly is a platform that enables travelers to customize their holidays with ease using an interactive trip planner. The platform is based on industry-proven API technologies that allow guests to seamlessly create and purchase travel on-ground itineraries for 70 destinations out of the 120 AirAsia destinations.
Guests can also combine and view them in a single itinerary for easier travel planning. This feature complements AirAsia’s guests’ travel intention and purchase habits, leading them towards higher conversion.
Going forward in 2017/18, AirAsia BIG Points will be used as a currency to redeem deals on the Touristly platform, including one-click hassle-free payment with AirAsia BigPay.
By Vivian Foo, VCNewsNetwork
This news is published on Reuters.