Q&A: Travelfish's Stuart McDonald on the OYO and Instagram problems plaguing Southeast Asia

Stuart McDonald of Travelfish has seen some dramatic changes over the 15 years the Southeast Asian online travel guide has been in business.

For one, changes in the global economy have created a drop in gap-year travelers - which have made up much of Travelfish’s readership - while at the same time, budget brands like AirAsia and OYO have made shorter trips to previously prohibitively expensive destinations more feasible.

The guidebook ecosystem has also changed, with a shift away from Lonely Planet- and Rough Guides-style recommendations to Google search results and TripAdvisor reviews.

To McDonald, who fiercely defends Travelfish’s independence, much of this is problematic, as he explains in detail below.

How have you seen the travel landscape in Southeast Asia change in recent years?

With mainland China and Southeast Asia coming online, that’s a new substantial volume of people who are relatively new to the region and travel differently than your traditional backpacker.

On top of that, there’s different types of accommodation - mom-and-pop guest houses are fading away and being taken over by OYOs and hotel chains. That changes the whole experience, at least from my point of view.

I spend a lot of time looking at hotels, and now I go into a city and there will be 15 or 20 OYO brand hotels. It’s the McDonald’s of travel: They’re all similar, they’re not memorable and they’re completely forgettable, but they’ll do the job. They’ll cost you 15 or 20 bucks and you get your flat-screen TV, your white linen and your Wi-Fi, but there’s no character to the place.

It makes the experience the same everywhere, which is a bit of a shame, but that’s how destinations are moving to accommodate this sometimes-substantial increase in visitors.

AirAsia is making it easier for large numbers of people to get to destinations that were previously difficult to get to. That’s been the main changes on the ground at least from our point of view - not for the better in my opinion. I don’t want to be the, “You should have been here yesterday” kind of guy, but it is a very different experience from what it was in the ‘90s.

Why do you think these budget brands are able to flourish, and is a model like OYO’s sustainable?

I read something interesting about OYO … because they tend to not own the properties, they just do a deal with whoever is running it and brand it. So what they do is guarantee you [something like] 80% of your rooms they’re going to fill a month and when it’s close to end of month, if they’re not going to make the target then they drop rates right down. They’re essentially losing money to make their target.

There’s been a lot of pushbacks from owners who are saying this isn’t making money. That kind of thing is a problem. I don’t know how that will play out longer term.

OYO is the McDonald’s of travel: They’re all similar, they’re not memorable and they’re completely forgettable, but they’ll do the job.

Stuart McDonald - Travelfish

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I live in Bali and I was tweeting the other day that I was in a hotel, and within 200 meters of me I think there were nine or 10 mini hotels - ones with 50 or 60 rooms. They weren’t all OYOs, but a couple OYOs, and none of them were there five years ago. They’re all $20 a night; they’re not charging enough money to have a sinking fund and maintenance. So I’m worried about what these properties are going to be like in another 10 years.

These destinations are going to end up with shitty hotels that really no one wants to stay in, but [the hotels are] there, so it’s a problem from a destination point of view. It ends up being this box hotel place. Who cares where you stay when they’re all the same. So local flavor - staying at a family-run place – they’re not getting any of that in these kinds of properties. And I’m just using OYO as an example, but there are a whole bunch of those chains. I think it’s pretty problematic from the destination point of view.

For travelers, they might eventually want to move from an OYO to more interesting property as they travel more.

But once local places are gone, they’re gone and they’re not coming back.

What we see a lot of in south Bali are places that were originally family-run - been there 30 years or something - and mom and dad are in ground now or have given the property over to their kids, but they’ve not made enough money and the place needs a revamp.

Kids don’t have enough to do that, and the only thing they can do is sell it. The property itself, the building is worthless, but the land is worth a bazillion. The only solution is to sell it to these companies that are going to put a big hotel there. It’s the only way to make money back on the land because land’s so expensive. So local talent is gone and there’s just another $30 a night hotel the same as 50 other ones in the same area. You can’t go backwards.

What does Travelfish offer to travelers in region?

We’re going through a pretty tight period. We had some very good years and some very bad years. Essentially we’re like a guidebook online, like Lonely Planet or Rough Guides.

Like I was saying before about the changing way people travel - we’ve sort of made this great resource for if you were traveling in the ‘90s. We tend to find our readership is far older than I would have expected.

We’ve been through various different ways of making money: ad-driven for a long time, affiliate-based like with hotel commissions. A couple years ago we went to a membership model. We dropped ads and it’s been a really, really hard slog.

In the same breath, we’ve lost about half our traffic year-on year, and that’s just Google sucking up travel and that kind of thing. It’s pretty difficult at the moment.

How does Google factor in, and how are you trying to compete?

They shouldn’t be allowed to do what they’re doing. I guess it’s good for Google shareholders. I have no problems with competing with other people in search on a level playing field, but when Google gets its material and shovels it in at the top - that’s all revenue-earning for Google. That’s very problematic.

A report recently said 70% of clicks on Google go to another Google property - might be YouTube or Google Maps or their travel portal or whatever. Back in the day, Google was all about, “We’re going to send you to answer as quickly as possible.” Now it’s much more keep answer here [within Google].

As example for us: We rank very well for general weather questions, that’s always been a good traffic source for us. Now Google puts all that on their own site.

We’ve also paywalled a lot of the site to drive the membership, but when you do that then Google penalizes you and you get pushed down in the search because people will click through and see it’s paid and bounce back, so the signal is they’re not getting a good experience.

It used to be just TripAdvisor and Lonely Planet and destination-specific websites, but now there’s so much more.

Culture Trip is hemorrhaging money. It’s the new spam for travel, all over search engine results. I don’t know if that’s always a good result for a traveler, some of their material is good but a lot of it isn’t.

But we’re not funded - never were - and that’s sort of frustrating. It’s like complaining about the wind, but it’s frustrating competing against businesses with no need to make money, at least in the short term. 

We’re one of few publishers who doesn’t take freebies. We go everywhere we write about, we’re very old fashioned in that regard.

In terms of content, do you have an advantage in Southeast Asia because you’re based there as opposed to Culture Trip or Lonely Planet?

I’ve been traveling around in circles for 15 years, so we’ve seen how destinations have changed. When we send the writer to some island they’ll look at all the beaches for example and can say with some authority this is the best beach versus someone who goes to the beach and says, “This beach is amazing.”

We do it the old style, like the guidebooks, but I think from the reader point of view, people seem to be satisfied with user-generated material. I would much rather one review of a temple that’s authoritative and tells me about it rather than than 20,000 reviews of same temple on TripAdvisor, but it’s a personal choice.

You used to be either a Rough Guides person or a Lonely Planet person in Southeast Asia. Now people are pulling in info from a vast number of sources. Sometimes that’s great - obviously we don’t cover everything and there’s always some blogger or magazine that’s done something interesting.

Social media tends to also dictate which places pick up popularity.

Instagram is the big one for this. There’s an island off the coast of Bali which has some very spectacular cliffs and beaches. Ten years ago there were maybe 15 hotels; now there’s 150. It’s on Instagram continually. You go to the sites and there’s a queue of 100 people waiting to get a selfie on a swing or whatever the hell.

Instagram in particular has been pivotal in really channeling this overtourism down to specific destinations. There’s a very good study by GetYourGuide - their number-one-selling tour worldwide is a Bali Instagram tour. It makes me want to eat broken glass. It’s one day and they take you to six or seven top selfie spots.

It’s interesting - they looked at what people were buying, all individual tours, then made their own. GetYourGuide put the trip together with a local operator and you pay more to get a drone, this and that, whatever. People are spending hundreds of dollars for this tour and going to six or seven spots to take photos.

For me its exact opposite of what Bali is about. It’s a huge problem for local residents and traffic and all that. Money is shifting to this foreign company.

There are local operators who used to do this, and they’re still there. The partner with GetYourGuide I think is making out like a bandit.

Instagram in particular is a big one. It’s beautiful but it’s bullshit. You see the beautiful photo of the beach but you don’t see the mountains of garbage behind it.

And influencers are spending so much time cultivating the perfect photo.

Influencers are like influenza. I don’t know what the solution is.

I think it is a real problem when you have a highly respected temple completely overrun with people who, through no real fault of their own, are not dressed respectfully or behaving properly. These are still houses of worship, places locals go. Now it’s a photo shoot 24/7.