Thomson brand is rubbish say experts

Well, kind of.

Enormous interest in our story yesterday about Thomson-First Choice not being particularly enthusiastic about the Superbrands programme.

Within an hour or so of our story going out, Stephen Cheliotis, chief executive of the Centre of Brand Analysis, which runs the judging process for the Superbrands 500 list, was on the phone.

Cheliotis was keen to point out - as a PR rep had done repeatedly earlier in the day - that there is absolutely no connection between those who pay to be "members" of the Superbrands programme and those who appear on the list.

Fair enough. We had that in our original story anyway.

So then we got onto talking about the judging process for this year's Superbrands 500.

As we noted previously in our , a list of around 1,350 brands is selected by the TCBA from numerous sources. The list is then put in front of an Expert Council of luminaries from media, marketing, ad agencies etc, which decides on a list of the best 750 brands.

The 750 are then put to a public vote of around 2,500 people, which decides the top 500.

So it turns out that Thomson was a lowly 964th in the 2008 expert list and didn't even make the public vote. The experts clearly think of Thomas Cook in a much better light.

First Choice was in 1,039th position.

This means that the all-conquering Thomas Cook was 892 places higher - in the final list - than Thomson. Crikey.

The whole thing gets even more bizarre when Cheliotis revealed that Thomson managed to get in the 2007 top 500 list in 161st.

Some might call this a rather tragic fall from grace (hilarious, Thomas Cook would probably say).

Others will be looking to the Expert Council for an explanation as to why a company which featured in a reasonably high position one year can not even be considered worthy of the top 750 the next.

Cheliotis told us the make-up of the council changes every year, which will account for differences of opinion, of course.

There is "invariably some volatility" in the list, Cheliotis adds. Indeed...

Anyway, we suspect Thomson-First Choice won't be too distraught at missing out this year, as their comments indicated yesterday, but will be keen to see where they feature in the pre-public vote next year.

Kevin May, editor, Travolution

Technorati tags: superbrand superbrands thomson first choice

Perspective again please

Plenty and rather mixed coverage around the web today regarding the second anniversary edition of the Hitwise-IMRG Hotshops list.

The quarterly report of the top 50 UK online retailers is a handy benchmark of whose flying or dying in the online world, albeit from a share of overall web traffic rather than individual performance.

So what did the May 2008 report reveal, compared to that of May 2006?

There are currently eleven travel brands amongst the top 50 – a list topped unsurprisingly every quarter since it began by Amazon.co.uk.

TravelMole led with how Thomson Holidays is creeping up on easyJet as the most popular travel brand in the UK, while E-Tid said ‘Travel companies lose web presence’. [both require registration]

The report indicated that almost all the leading travel brands – with the exception of Thomson – had seen in a decline in position since the report began two years ago:

EasyJet – 8 to 10
Expedia – 7 to 12
Ryanair – 9 to 14
Lastminute.com – 12 to 17
BA – 11 to 19
Thomas Cook – 18 to 25
First Choice – 20 to 29

Quite a number of travel brands have dropped off the list:

MyTravel (for obvious reasons)
BMIBaby
XL.com
FlyBe
Jet2
InterContinental Hotels
Monarch Airlines
Opodo

The only newcomer in travel:

TravelRepublic

The apparent slump in the performance of travel websites led the Financial Times to headline with ‘Airlines lose web customers’. Lose?

What the FT failed to do is explain in detail why this has happened.

A call to Hitwise’s Robin Goad, co-author of the list, confirms the obvious: travel was an early adopter of e-commerce and consumers, likewise, felt comfortable with booking via the web, thus why so travel sites commanded a large share of the top 50.

In the past two years, however, other retailers have emerged – some traditional offliners, others created to service existing markets but purely online – and have attracted new users.

So while growth in online travel bookings may be slowing compared to other industry verticals, it is by no means declining.

Kevin May, editor, Travolution

Technorati tags: hitwise IMRG hotshops retail

Here's looking at you, kids

Haven Holidays, the owner and operator of 35 holiday parks in the UK, has added some new features to its web site aimed at making the online experience more fun.

A few weeks ago, Travolution reported that Haven had signed up Nasdaq-listed JDA Software for a new multi-channel revenue management system. Aimed, one assumes, at making the online experience more profitable.

UK holiday and caravan parks have a number of issues to overcome, in terms of profitability as well as the product perception.

Haven – and others in the sector – are using the web to address these issues. JDA will help Haven manage inventory during to drive short break business during the parks’ less busy periods outside the school holidays.

The consumer-y features launched today include an improved kids zone channel, designed to get the kids to engage with the brand before the holiday.

As a family holiday business, it makes sense to get kids onside, although whether the web-savvy ,instant-messaging, PS3, Bebo generation will be satisfied with Haven’s offer to ‘play games, download pictures to colour in themselves and take part in competitions’ remains to be seen.

Back in the mists of time – okay, mid-2004 to be precise – Mintel released a report called 'Marketing to Tomorrow's Consumers'. 46% of parents said that their children had 'some level of influence' over the choice of the main family holiday.

Tour operators are always keen to big up their kids club products – such as First Choice’s ‘we’ve taught more than 7,000 kids to swim’ TV ad campaign – but how serious is the online travel sector about engaging kids before or after their break? And how receptive would the younger generation be?

Martin Cowen, chief writer, Travolution

Number One or Number Two - the topsy turvy world of online rankings

Thomson is understandably chuffed to pieces after overtaking Expedia in the first few weeks of January in the Hitwise online agency rankings.

Being able to say "We are the #1 online travel agency in the UK", or similar, on promotional material goes a long way. Not that Thomson has used it in that way yet.

But the scene at the top of the pile changes often.

The top ten for the week ending 13 January went like this:

• Thomson Holidays
• Expedia
• Lastminute.com
• First Choice
• Thomas Cook
• TravelSupermarket
• Cheapflights
• TravelRepublic
• Teletext Holidays
• Ebookers

But here is a graph illustrating the relative positions of Thomson and Expedia throughout 2007.


One can read a few things into this:

Seasonality impacts on Expedia and Thomson in different and/or the gap between the two is incredibly close, meaning the positions change frequently.

The other thing to note with the remaining sites in the top ten is the presence of TravelRepublic (above Ebookers), the inclusion of non-travel agency sites (Cheapflights and TravelSupermarket), and the absence of Opodo (number 12 or 13 normally).

Kevin May, editor, Travolution

Technorati tags: hitwise thomson expedia

27,000 people prefer Lastminute.com

According to a BT consumer survey the pink'un is the nation's favourite travel website.

Lastminute.com pipped TripAdvisor, First Choice, Rough Guides and Ryanair to the top spot.

The great thing about these kind of surveys is that they very rarely reflect traffic or usage. Let's face it, Rough Guides is a bit leftfield on this list.

And pity poor Expedia.

Kevin May, editor, Travolution

Amazing: trying to book a holiday online is not one of the most irritating things about Christmas

There is goodwill in the air - apparently.

And it is also the season for meangingless consumer surveys!

This week's effort comes from First Choice which has asked 3,000 people to single out what they hate about Christmas.

Leading the list of 50 irritants is Novelty Tit-Tat, followed "The Sales", Christmas Carol Ringtones, Traffic and Queues.

The remaining include such galling items as Brussel sprouts, Fig rolls, Pine needles and heavyweight topics like Putting on weight, Rubbish television and The Queen's speech.

Thankfully nowhere amongst the 50 is Trying to book a holiday online.

Hurrah!

Kevin May, editor, Travolution

TUI Travel sharewatch

TUI Travel officially came into being today.

For those with their heads buried in the sand since early this year, TUI Travel is the trading name of the recently merged First Choice and holiday division of the German TUI AG group.

The new PLC is listed as of this morning on the London Stock Exchange.

See the Yahoo Finance ticker for TUI Travel.

So the old Big Four are now the Big Two. Hogwash.

Listen to anyone with any clout in the industry and they will admit that the "Big Two" is a bit of a fallacy. There are many other "big" travel providers around these days.

The sooner the industry wakes up to the new world the better. Thankfully this is finally happening.

Meanwhile, over on the Yahoo Finance page for Thomas Cook PLC shares, EasyJet has found itself in a rather nice position today with a banner ad for its latest sale. Three cheers for online advertising...


Kevin May, editor, Travolution

Technorati tags: thomas cook tui travel shares

Good news day for Cheapflights, Lastminute.com, First Choice

PING! Press release from the Comscore web measurement service arrives with happy news for Lastminute.com, First Choice and Cheapflights.

The trio are amongst a list of the top ten UK web brands showing the strongest growth in July.

The top ten are as follows, showing monthly uniques and the shift on July 2006:

Odeon 2,618 (up 49%)
Lastminute.com - 5,172 (up 30%)
Facebook - 7,604 (up 26%) Well, derrr
Cheapflights - 2,801 (up 22%)
Disney Online - 3,190 (up 22%)
First Choice Holidays - 3,592 (up 19%)
Play.com - 4,753 (up 19%)
Next Group - 3,851 (up 18%)
Dixons Stores Group - 4,712 (up 17%)
WordPress 2,716 (up 16%)

Bob Ivins, executive vice president at Comscore, says this:

“The success of travel and holiday sites mirrors the seasonal trends in the offline world, with July being a popular month for holiday, retail and entertainment sites. However, with the weather in the UK being so poor this summer it’s clear that – for domestic recreation activities at least – people have been surfing the Internet for indoor entertainment, hence the growth in traffic to cinema site Odeon.co.uk.”

Would this have been the case a few years ago? Probably not. The lead-in time for holidays is shortening every year. Holidaymakers will happily wait until the last minute before booking. The shoddy weather just exacerbates the situation.

[Full press release featuring the overall top UK brands]

Kevin May, editor, Travolution

Technorati tags: thomson
cheapflights first choice comscore uk web traffic

Job losses are bad - but so is being unrealistic

Nobody would really say they were surprised when they heard today that the new Thomas Cook Group is planning to close 150 shops and a number of offices, potentially putting up to 2,800 jobs in the firing line.

Perhaps the figure is somewhat higher than expected but the strategy is hardly a leftfield move from Manny and co.

Unfortunately mergers always lead to business functions from existing companies being combined.

Couple this with the obvious pressure on existing High Street agencies belonging to Thomas Cook and MyTravel from the internet and the old model was clearly unsustainable.

Let's hope TCG make good on their promise to "redeploy" agents into other areas of the newly formed business.

What staff representatives - in this case the Transport Salaried Staffs' Association - must ensure is that pressure is put on TCG to re-train as many of the affected staff as possible so their undoubted knowledge can be used elsewhere in the business.

To lose that many highly skilled people would be disastrous for TCG - and for the employees themselves and towns such as Rochdale.

A TSSA spokesman on the Telegraph website this evening said:

"This is terrible news for Rochdale and the North West and will also be bad news for consumers across the UK, for it will mean less choice in the high street when it comes to holiday bookings."

The spokesman is absolutely correct about the impact on regions where many jobs could be lost, but some might suggest that is where the argument ends.

It is because consumers are finding there is enormous choice on the internet for holiday products that Thomas Cook, MyTravel, Thomson and First Choice have been steadily closing shops anyway.

NB: There is also a healthy independent travel agency sector in the UK.

Kevin May, editor, Travolution

Technorati tags: merger job

...meanwhile, over at Thomson

Thomas Cook Group arch rival Thomson - soon to be TUI Travel, once its proposed merger with First Choice kicks in - held a press conference in London this morning to unveil its annual Online Booking Report.

Some scene-stealing stats were rolled out by its new media director, Graham Donoghue:

• 60% of passengers are now booked online
• Hitwise data shows it is the second most visited site in the UK during 2007 - behind Expedia, ahead of Lastminute.com
• Running 1 million keywords on Google [someone said a few months it wanted 3 million, but Google advised against it]
• 500,000 videos viewed every week

A PDF from the press conference and 22MB Powerpoint presentation are available. [Travel Weekly story]

Meanwhile, TripAdvisor has spent far less time negotiating with Thomson than it has with sister company Expedia, over a deal to share user generated reviews. It took around ten weeks for the pair to come to an agreement and TripAdvisor reviews on Thomson.co.uk will be seen from September this year.

By the time TripAdvisor reviews are made available on the Expedia UK website, at least 18 months will have passed since the online travel agency publicly said it wanted to run user generated content from TripAdvisor on its site.

We're reminded of the phrase: You can choose your friends, but you can't choose your family.

Kevin May, editor, Travolution

Technorati tags: thomson tripadvisor hotel review online sales

Mystery company tried to buy Thomas Cook last year

Interesting session at the ITT Conference with Manny Fontenla-Novoa.

Full post on our ITT Conference blog here.

He mentions a mysterious "another company" that apparently came in with an offer for Thomas Cook in the summer of 2006. Shareholders turned it down. Who could it be?

[Our apologies for the incorrect link yesterday. All correct now]

Kevin May, editor, Travolution

Travel Survey Day #2

Another one: Travel websites represent 14 of the Top 50 retail websites in the UK, according to the IMRG/Hitwise Hot Shops survey for May 2007.

Leading the field are Amazon.co.uk, Tesco.com, Argos, Play.com and Amazon.com in the top 5 positions.

But positions six to ten are dominated by travel brands:

Expedia.co.uk (6)
EasyJet (8)
Ryanair (9)
BA.com (10)

Elsewhere in the Top 50:

Thomson Holidays (11)
Lastminute.com (15)
First Choice (20)
Thomas Cook (25)
MyTravel (27)
ThomsonFly.com (28)
Travelodge (30)
BMIBaby (33)
FlyBe.com (37)
Jet2.com (39)

Remarkably only two travel brands have lost their position in the Top 50 since the survey started in May 2006:

XL.com and Opodo.

No sign of Ebookers since the survey started.

Kevin May, editor, Travolution

Technorati tags: web traffic hitwise shopping retail

Travolution@E4T - FirstChoice to relaunch, but why?

UK multiple FirstChoice is planning to relaunch its website in November this year, despite the company being just weeks away from a merger with TUI.

Dermot Blastland, FirstChoice managing director, told delegates as much during a session on "Scale vs Specialisation".

As well as the usual relaunch spiel, Blastland said the new site will be designed to cater for those still lacking the confidence with online booking of travel products.

If rumours are to be believed, practically every travel website in the land will have seen some kind of makeover by the end of the year - so what is so special about FirstChoice?

The fact that the company is forging ahead with plans to relaunch the site despite being on the verge of joining forces with Thomson - which, as readers will know, has a very strong online presence - indicates a number of things:

• FirstChoice is worried it will not get a green light for its merger. Possible, but unlikely.
• FirstChoice offline brand is strong and they don't want to lose it completely.
• FirstChoice online brand is strong for SEO and it would be suicidal to cut of traffic.

This is all very intriguing...

Kevin May, editor, Travolution

Technorati tags: merger

Travolution@Triton - Mergers ahoy

The Triton conference is being completely overshadowed by what was just industry gossip yesterday and is hard news today that the UK travel consortium is considering a merger.

This is big news.

The trio of companies that make up Triton – Advantage Travel Centres, Global Travel Group and Worldchoice – are in active talks and have, there is no doubt about it, Big Plans.

We have ambitions to be “one of the top three groups,” says George Begg, chairman of Global Travel Group and an advisor to Triton.

Big Four to Big Two to Big Three perhaps…

In simple terms, the mergers elsewhere in the industry (Thomas Cook-MyTravel and Thomson-FirstChoice) have forced Triton’s hand.

The plans, which are being discussed by the Triton board but are clearly well advanced, will see Triton become a multiple, using stock (air and hotels), tour operating (holidays) and distribution (shops, call centres and the web).

Begg reckons the difference between a potential Triton powerhouse (“virtual vertical integration,” he calls it) and the other giants will be distribution controlling supply, rather than the other way round.

The Long Tail in action...

To top it all off, there are plans for a floatation in three years time to raise £20 million in capital to assist in what are clearly ambitious growth plans.

From a corporate perspective, a fellow hack and I have already been speculating as to who will take the top job.

John McEwan (boss of Advantage Travel Centres) and Andrew Botterill (CEO of Global Travel Group and a Travolution board member) would – most suspect – be vying for the top job.

Begg finished outlining the merger plans. A quick Q&A gleaned nothing (understandably the Triton board are trying to remain pretty tight lipped).

Cue a quick rush to the doors for coffee break and discussions that will clearly dominate the weekend.

Kevin May, editor, Travolution

Technorati tags: triton

Thomas Cook-MyTravel deal being overshadowed by something bigger

Just as EU regulators were rubber-stamping the Thomas Cook-MyTravel merger this afternoon, news reports sprung up all over the web about a potential deal between Microsoft and Yahoo!.

Oh, those two...

To say this would be the deal of the century would something be an understatement, affecting any company using the web.

Here's the report on the New York Post website, which broke the story under the headline "Bill's hard drive". And Mashable's analysis.

The BBC says the deal could have a value of $50 billion.

Back to the TC-MT merger. The likelihood of the Thomson-First Choice deal not being given the green light - especially after the pair agreed to offload some Irish businesses earlier today - is now very small.

As Travolution has said a number of times, deals between the Big Four were always likely to happen. What has shocked many people has been the timing.

Consolidation within the next year to 18 months - most people would have said yes. Time moves quickly.

Fuelled by the rapid rate of change in the industry and the need to get a grip on stock and route strategy, 2007 will probably be remembered as the year the "traditional" end of the industry woke up.

Kevin May, editor, Travolution

Technorati tags: microsoft-yahoo takeover

A Good Friday to take stock of 2007

Time flies fast, the saying goes, but the first quarter of 2007 appears to have raced by quicker than you can say "Big Four into Big Three into Big Two".

Without doubt the biggest story to hit the travel industry so far this year has been the consolidation between the traditional travel providers - Thomas Cook and MyTravel shocking many people back in February when they announced their merger, followed by TUI and First Choice a few weeks back when they decided to get in on the act.

Our analysis of the TUI-First Choice deal merger provoked some strong reactions, but we stand by it all. The US players MUST be watching the situation here in Europe very closely.

The deals came shortly after we published an interview with Ian McCaig, chief executive of Lastminute.com, who spoke of a widening gap in the European industry between those that have the power to negotiate on high volume deals with suppliers and, basically, those that do not.

The smaller companies will find themselves forced into "going niche", as someone else put it to us shortly after McCaig's comments.

Meanwhile much attention - admittedly a lot from us - has been given to the British Airways content distribution negotiations with the four big GDSs.

So far Worldspan, Galileo and Sabre Travel Network have re-signed, with Amadeus remaining.

Tricia Holly Davis has been following the event closely for months, breaking a number of key developments during the negotiations, including the news that BA was playing "rack-rate" to GDSs after talks failed to bring about a solution before the original 28 February deadline.

Amazingly, while all the above events have been going on, Expedia has managed to keep itself almost out of the news entirely for almost half a year now, such has been the focus of attention on the shenenigans across the traditional market.

But the OTA suddenly finds itself in a unique position: it is one very few big travel companies, certainly in the US, not owned by private equity; and it is still the dominant player in many markets.

Rumours abound, however, Expedia will feature much more heavily in headlines in the remaining three quarters of 2007.

Kevin May, editor, Travolution

Technorati tags: expedia british airways online travel

The 'most important year for years' - two years early

Lots of "years" there...

But those were the words used by one of the most senior people in the travel industry this week when, during a private dicussion, he described the reasons behind events of the past few months.

There is no doubting that what has happened, for example, with the planned mergers between four of the leading travel players in the UK, is a pivotal moment in how the industry is reacting to the new world of digital consumerism.

But did we all expect the consolidation, which is essentially a move to protect businesses and consumer revenue in the face of competition from the pure web players, to have kicked in so quickly, and with such enthusiasm?

Would we have second-guessed the current machinations just 12 months ago? Probably not...

What is clear, our confidant says, is that the REAL impact of the web and the hugely empowered consumer is probably knocking at the front door of travel perhaps two years earlier than expected.

The leading players are now moving quickly to ensure they are not staring at a worrying bottom line in just 24 months time.

Kevin May, editor, Travolution

So what about the Big, erm, Two then

[Updates at the bottom of the post]

All hell is breaking loose this morning as the rather predictable merger between TUI and First Choice is absorbed by the travel and mainstream business media.

The deal will see the pair, to be known as TUI Travel, eventually listed on the London Stock Exchange and responsible for around 27 million customers a year.

Here are the numbers:

• Pre-tax cost savings of £100 million a year
• Yearly proforma revenues of £12.1 billion
• 51% owned by TUI; 49% by First Choice
• A total of 200 holiday brands [yes, that's two-zero-zero]
  

Of course this all makes perfect sense for the two companies involved. Indeed, Thomas Cook and MyTravel did almost exactly the same thing in February- creating "The Big Three".

So now we have the Big Two.

What immediately springs to mind is that the consolidation so widely expected across the industry is still coming from within what people still call "the traditional end" of the market.

But is the current trend for creating large travel companies simply by combining the resources and brand power of existing travel players the best strategy - or even the only strategy?

We would suggest that the recent developments actually gives people a glimpse at what might be happening at a global level.

Or, more conspiratorially, the two recent deals are an attempt to ward off potential suitors from across the Atlantic Ocean.

In fact, when looking at which companies are left amongst the clutch of so-called large travel providers, it seems rather odd that a crossover hasn't happened already.

Clearly some business between one of the large US players - Expedia, or one of the Sabre or Travelport-owned companies, such as Travelocity or Orbitz - and a traditional European travel company would create a rather tantalising travel mega-brand.

The formation of a company which incorporates the servicing power of an established supplier/multiple with the online expertise and brand power of an US travel provider would undoubtedly be a very exciting prospect.

So why hasn't it happened?

The large European travel providers would argue that their recent efforts - Thomon/TUI in particular - to beef up their online presence has meant it can compete happily with the growing US ownership of the travel industry. They would clearly not want to a merger...

This is perhaps so - traditional players still want/need to protect their interests. So attention has to turnto the travel conglomerates dominating the US market.

With piles of private equity money sweeping through the industry in the US it seems inconceivable that interest has yet to turn to the European tour operator market.

While we are not suggesting that the recent deals have been created simply because of a need to protect themselves against a US invasion [admittedly a rather unfortunate turn of phrase] - it is worth bearing in mind.

It must surely only be a matter of time before the US moneymen run out of potential small-to-medium sized online travel companies to buy and look elsewhere, perhaps at the unique European tour operator market.

UPDATE: Peter Long, the chief executive-in-waiting of TUI Travel, is reported to have told a press conference this morning:

"Expedia, Travelport and Travelocity are the new competition. The more business we can get online, the more we can drive down our cost of acquisition."

Kevin May, editor, Travolution

Confusing article about Online vs High Street #94

TheLondonPaper, a free newspaper in the capital which more often than not spends most of its time on the seats of tube trains, produced an article today titled: When internet booking isn't the only way to fly.

The piece is not available online - only on a digital edition here - but it is loosely an advice piece about the merits of visiting a travel agent rather than booking online.

It follows a month or so after the Holiday Which? magazine produced a similar investigation, arguing that High Street travel agents are nowhere near being able to match the prices of the online operators.

Today's piece in TheLondonPaper has good intentions, providing readers with a breakdown of various destinations and fares for different booking options (package, hotel-only, flight-only).

But, typically, it compartmentalises 'traditional' companies such as Thomas Cook and Kuoni against online players Expedia or Lastminute.com.

The conclusions:

In three of the five regions considered, a travel agent was found to provide the overall cheapest option.

And here are some, erm, insightful soundbites:

"We checked web reservations for flights and noticed that the prices were often surprisingly high and involved inconvenient stop-offs."

"We found that booking a last-minute flight online is almost always more expensive than via a travel agent."

"We also found that booking accommodation directly with a hotel will almost always be cheaper than on the net."

What the article does not say is whether the price for the travel agent products were cheaper or more expensive on any of their own online channels, such as Thomascook.com, FirstChoice.co.uk or Kuoni.co.uk.

The survey also only used Expedia and Lastminute, rather than any travel or meta search engines, such as Sidestep, AustraliaTravelMarket, et al.

Interestingly the two areas that scored well for the online travel agents were both in the long-haul market, Australia and Thailand.

The problem with so-called investigations into the online and traditional routes to buying travel is that the methodology is always going to be difficult simply because of the size of the market and the variables associated with products.

In other words: it is almost impossible - and ridiculous to attempt - to summarise the benefits of one booking method over another.

Kevin May, editor, Travolution

Weekend Caption Competition #7

Our - unfortunately - far too infrequent caption competition makes a welcome return this week.

And, of course, we couldn't resist wondering what might be going through the mind of Dermot Blastland, boss of First Choice, following the somewhat leftfield merger this week of his two rivals, Thomas Cook and MyTravel.

Entries via the comments button

[Thanks to Travel Weekly, who are also running the picture.]