During the recent RTO Summit East, INBOUND’s editor-in-chief, Jake Steinman, had lunch with at a delightful Greek restaurant in New York City with Tomás Rey, the founder and president of the New Orleans-based Rey Royal, a receptive tour operator whose slogan is “Travel Like a Local.” Tomás has been in the business for a period approaching two decades, and we had the opportunity to discuss a wide range of subjects regarding the tour and travel industry. Here, we share excerpts of our conversation with Tomás.
Jake Steinman: So, how did you get started in the business?
Tomas Royal: I worked in international sales for a Belgium company and enjoyed traveling all over the world, but traveling internationally every other week after six years made me desire a new path to proceed. I took three months off and went to Europe where three totally different people (an Italian friend, my brother and a Costa Rican friend, told me I should think about going into something in tourism, being that I have a wide-variety of friends from all of the world, I speak several languages and I love New Orleans (my hometown). My Costa Rican friend and her receptive company in Costa Rica, educated me about tourism and the receptive business. In 2002, I opened a receptive operator for New Orleans and Louisiana at a time when there were several competitors in the area.
JS: What was the turning point for you?
TR: I started to enter the FIT market while tour operators were getting out of FIT by focusing on selling and servicing of groups. Then Hurricane Katrina hit in 2005 and no one was doing any business. Every one of the other local operators went out of business and I was the only one left standing.
JS: How were you able to survive?
TR: 2006 we had requests to book hotels for the U.S. Army Corps of Engineers and FEMA (Federal Emergency Management Agency). And then the BP oil spill in 2010 also influenced things; we had a whole new group that needed rooms.
JS: How long did it take for New Orleans to get back to normal?
TR: For my business, not until 2011, about five years later. After Katrina, I changed my business focus and decided to branch out to Texas and the South. A few years later, two of my biggest clients asked me to go into the Midwest to handle their clients there. Now Chicago has grown into a great market for us, fourth only after Louisiana, Tennessee and Texas. Now we handle the entire South and Midwest including Minnesota, Wisconsin, Michigan, Illinois and Iowa—many of the states along the Mississippi.
JS: Were any other receptives serving the Midwest?
TR: There were other bed banks that were selling hotels but we were the only inbound operators that contracted local guides. Four years ago, we found out we couldn’t just sell hotels, so we began offering private tours, which is a good market that is growing for us. After Katrina, most of the French operators were glad to find someone who spoke French. Before Katrina, 80 percent of our inbound was Latin America and 20 percent was from Europe; it flipped after Katrina to 80 percent European because of Latin American airlines that stopped servicing that market.
JS: What are your top source markets?
TR: France, Germany, Canada (Quebec and the Maritime Provinces), Benelux, Mexico (for medical conventions) and Brazil.
JS: How has business been for you recently?
TR: Well, it might be hard to believe, but 2017 was one of our best years; 2018 was better, and 2019 looks to be even better than that.
JS: It sounds as though you’re on a roll. How would you describe your business?
TR: The connections we’ve made with France, Latin America and Belgium and Canada are beginning to pay off and we’re focusing on operators that are working with the high-end market and they are doing pretty well. The day of the standard tours and hotels are not what people want anymore. They’re looking for products like hands-on cooking classes, which are huge—we began offer them in French and Portuguese. Our tag line is not “Live like a local,” but “Travel Like a Local.” We take them where the locals go.
JS: Is this the same cast of tour operators you’re accessing or are there new companies coming into the market?
TR: The majority are tour companies that have seen the writing on the wall and understand that younger people are going online and booking hotels directly. They are now concentrating on the 40+ plus market who want personalized service and don’t mind paying a premium for it.
JS: Do You have national aspirations for Rey Royal?
TR: Not really for the FITs, but we already do groups nationally for MICE. I keep the group size at maximum of 20 so we can get into restaurants and clubs where “the locals go”.
JS: What about attractions?
TR: It’s something that they can always buy online. Most don’t want to book in advance so we have to find a way to get involved. Sometimes we will set up a kiosk that will serve as welcome center that acts like a concierge. Recently, though, we have been thinking about working with an app developer that can push out attraction offers and discounts from us while they are in the destination wandering around.
JS: What are your primary challenges?
TR: Crossing over and working with tour operators who are not only selling to agents but have consolidated with other companies and are now selling directly to the public. In the Netherlands, for example, lots of tour operators are closing up—but the challenge is how to get a piece of that business with the few tour operators there but offering them something unique, or in other words, sculpting a product or products so it’s unique. If you’re selling a typical tour or attraction anyone can offer, you’re limiting your services or not casting your net far enough. Also, it’s key to work with your DMOs / CVBs in the various states who are open to try something new and think outside the box on how you both can capture more visitors to their destination. I’m fortunate to work with so many who understand this and partner with us.
