NEWS — BIG INTERVIEW
The converted barn in West Sussex where Lowcost had its first office
Evans has taken part in various stunts to promote Lowcost. Left: at the London Dungeon
“It’s no longer the man from Del Monte turning up and telling the supplier this is how it will be.” Evans says that while more than
50% of traffic to the company’s consumer sites come from mobile and tablet, the march of technology has not progressed as quickly as many predicted over the last decade due to the complexity in areas such as scheduled flying. So this bodes well for firms that cut through this complexity
Travel Weekly headlines, 2004
l MyTravel reports losses of £910.9 million
lThomas Cook group doubles losses
l Amex research ‘dispels low-cost myth’
l Online players grow market share
l MyTravel becomes smallest of big four
l Package sales drop to lowest in 11 years
by providing customers with a great place to shop while helping suppliers constantly yield-manage rates and capacity. But Evans says new digital channels to market have not broken older tried-and-tested strategies and, in fact, the big web-based newcomers never over-relied on those.
Development While there was once significant first-mover advantage exploiting Google to access online customers, even 10 years ago the likes of Expedia understood the value of branding. Evans’ various stunts and
advertising campaigns have sought to emulate this for Lowcost – the favourable cost of customer acquisition, as people become loyal to brand, the prize. Lowcost’s development over the past decade is analogous to the way the budget airlines, which spawned the dynamic packaging revolution, have evolved, says Evans. “Lowcost originally was closer to
Ryanair – offer a low upfront price and then upsell and cross-sell. “Ten years ago I modelled
myself on Ryanair: we did not have
PAs, we did not have business cards, we ruthlessly took costs out. “That was a fundamental driver
to keep costs of sale down, but over time people have come to know we are Lowcost – now I don’t have to tell people we offer value. “We sell
“I’m in the
more four and five-star accommodation than anything else. Smart people have worked it out – it is easier, with such a huge range, to be neutral, and deliver exactly what we say. “People seemed to have actually
worked it out that this is a smart place to book your holiday – but over time we have probably become closer to easyJet.”
A decade of change Although over the past 10 years the UK has lost 3,000 travel agency businesses, Evans admits to being amazed at how resilient the sector has been, particularly in overseas markets.
billion-pound
He admits tough competition in the UK, and the market’s relatively homogenised, organised nature and small size geographically, has seen new ways of trading quickly assimilated. But still the
business, make no mistake. It’s not an ego thing; I
don’t know how to do niche”
trade remains an important part of Lowcost’s drive to become a £1 billion accommodation business. Today, Lowcost offers the
trade more hotels (239,000) than ever before,
with total transaction value on accommodation-only this year at €700 million. “Certain organisations are
incredibly efficient at lowering cost of sale, such as
Booking.com and Ryanair. They are businesses for their shareholders. “You have to build scale or build a niche. What we are trying to do is build scale. I’m in the billion-pound business, make no mistake. I’ve always worked with scale. It’s not an ego thing; I don’t know how to do niche – it’s just not in my psyche.”
4 September 2014 —
travelweekly.co.uk • 19
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