Tag Archives: winter holidays

Thomas Cook price parity sparks rise in indie agents’ sales

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Thomas Cook price parity sparks rise in indie agents’ sales

By Juliet Dennis

Thomas Cook price parity sparks rise in indie agents' salesIndependent agents have reported an increase in sales of Thomas Cook product following a move to single pricing across its in-house channels.

Cook introduced price parity across its shops, call centres and online in December. This allowed third-party agents to compete with the operator as the difference between Cook’s prices and independent agents’ narrowed.

In the coming weeks, the company plans to extend price parity to include sales through independents.

Hays Travel Independence Group has reported triple-digit percentage growth in sales of Thomas Cook holidays for summer 2013, while Advantage Travel Centres has reported a strong post-Christmas performance.

For years, online discounts have been a bugbear for independents because they could not compete on price and were forced to discount commission to win a sale.

Hays attributed its sales hike to Cook’s move towards price parity and the fact it had gained members who are strong sellers of Cook holidays.

Advantage head of commercial John Sullivan said consumers were shopping around less because prices differed “only by a few pounds”.

He added: “While price parity is not yet 100%, it’s now a lot easier for members to compete.”

It is understood Cook is also reviewing levels of commission to third-party agents.

A spokesman for Thomas Cook said: “Following the launch of price parity, we’ve received fantastic feedback and we’ve seen an increase in sales through our agent partners.

“Our commercial agreements remain confidential, but there is no intention to reduce income levels; we’re maintaining a level playing field so they can match our retail and online pricing.”

Take-off for Google Flight Search in UK

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Take-off for Google Flight Search in UK

by Lee Hayhurst
by Lee Hayhurst

 

Google has rolled out Flight Search in the UK as part of a first move into international markets.

The product, which is the result of Google’s controversial buyout of software firm ITA, has been live in the US since September 2011.

Its speed and ability to search for flights according to a diverse range of criteria has made it the source of much speculation, although Google has not rolled it out as quickly as expected.

However, today’s launch in the UK, France, Italy, Spain and the Netherlands with local pricing and in eight languages ends speculation that Google has reined in its ambitions for Flight Search.

The main difference between the US and UK product is the absence of a commercial unit that sits at the top of natural search results.

Google said it was assessing this before deciding whether or not to include this in its international version.

Other than that the non-US version is an exact copy, the Google spokesman saying it was aimed at people in the early stages of research when they do not know where they want to go.

Using a map-based interface, Flight Search allows users to filter their results based on how much they want to spend and flight time.

The biggest omission for the European market is the absence of Ryanair and easyJet, although Google said negotiations were ongoing.

In terms of fulfilment partners, Google has struck deals with a number of European intermediaries including Bravo Fly, Budget Air and fly.co.uk.

The Google spokesman said: “These are big markets. The plan with all our products is to go global as quickly as we can.

“With something as complex as flights there are a lot more partners to negotiate with. This is the first market beyond the US, but logic would suggest there are more to come.”

Thomas Cook reviews future of its airline

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Thomas Cook reviews future of its airline

By Phil Davies

Thomas Cook reviews future of its airlineThe future of Thomas Cook’s airline business is under review as part of chef executive Harriet Green’s turnaround plans for the loss-making group.

The disclosure came in the wake of moves to dispose of unspecified non-core assets to bring in as much as £150 million.

Green yesterday announced an additional £50 million of cost savings, taking the total to £350 million by 2015. This helped lift Cook shares almost 16% to 100.75p.

Part of those savings include £65 million from bringing its four airlines, which have 86 aircraft and employ 6,500 people, into one group.

Green would not rule out the disposal of all or part of the airline business.

“Does Thomas Cook need to have an airline in the future?” she told the Financial Times. “We have options. We are reviewing whether we should continue with the airlines that we have.”

The group had “over-complicated the business” through a series of acquisitions, including airlines, said Green.

“In essence, it is not a complex business that shouldn’t demand huge amounts of debt,” she said.

Green believed the group had become weak in its city break and winter sun offers, and would start to offer new products pitched at women and children.

The restructuring includes the closure of 195 high street agencies, contributing to the loss of 2,500 jobs.

New targets include 50% online sales and an earnings before interest and tax margin of 5%, both by 2015.

Cook earns about one-third of its revenues from online sales and the remainder from its outlets, according to the FT.

The group confirmed that a review of its capital structure could result in a future share placing.

“When that review is complete we will decide on what action we should take, if any, including whether to raise new debt and/or equity capital and the amount and structure of any such capital raising,” the company said.

Wyn Ellis, analyst with Numis, told the newspaper: “We wait to see how it progresses: a lot of hard work needs to be done if it is to succeed with its ‘high-tech, high-touch’ approach.”

James Hollins, analyst at Investec, said: “There is no update on a potential equity issue or refinancing…Current trading is stated to be ‘progressing well’ for the key summer period and the full-year 2013 outlook is ‘encouraging’.”