NEWS TRAVEL WEEKLY BUSINESS CONTINUED FROM THE BACK
protected under the Consumer Credit Act which makes the card provider jointly liable with the supplier and means refunds are guaranteed. However, this only applies to transactions above £100 so if elements of a holiday, such as transfers, cost less and have been separately purchased or invoiced they won’t be covered. Debit card refunds are only
available as ‘chargebacks’, which require a consumer to make a claim to their card issuer – Visa or MasterCard – which then makes a chargeback request to the retailer’s (Lowcost’s) bank. There is no legal right to this and the UK Cards Association notes: “There are no guarantees your issuer will be able to recover the money. Card issuers will consider all claims on a case-by- case basis.” When Travel Weekly sought clarification on the criteria likely to apply, an association spokesman said: “This will largely depend on the card scheme.” When we put the same question to Visa, we were told it would depend on the bank issuing the card. When a payment is made to
an agent like Lowcost Holidays there is also a doubt as to whether a bank will process a chargeback. The Cards Association said: “This will depend largely who the card is with and what their rules are.” The association could
provide no data on debit-card chargebacks and no guidelines on their application. The contrast with Atol-
protected holidays could not be sharper. The Air Travel Insolvency Protection Advisory Committee (Atipac) revealed on Monday that Atol failures in the 12 months to March saw the repatriation of 339 holidaymakers and full refunds to 795 at a cost of just under £4.8 million to the Air Travel Trust fund.
Lowcost’s failure results in lower Google ad rates
Lee Hayhurst
lee.hayhurst@travelweekly.co.uk
The collapse of Lowcost Holidays is expected to lower the cost of advertising on Google, according to industry sources.
The online travel agent and
trade beds supplier is understood to have been one of the heaviest UK travel advertisers on Google, regularly commanding top slots for many of the most-expensive search terms. Holiday Discount Centre managing director Steve Campion said he expects an impact on cost- per-click advertising. “Lowcost were big spenders on
pay-per-click,” he said. “They were massive for most
main travel terms and regularly in the top-three positions on Google. Given the margins they were working on you would question that level of spend. The failure may result in a bit of downward pressure on [Google] costs.” One leading OTA rival of
Lowcost Holidays said it had
First Choice sees strong demand for all-inclusives
First Choice forecast a surge in demand for all-inclusive holidays “as sunseekers look to take control of their holiday spending” following the fall in the value of the pound. The Tui-owned all-inclusive
operator reported a week-on- week increase of more than 10,000 web searches for all- inclusive holidays in the week following the UK referendum vote, which triggered the pound’s fall.
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travelweekly.co.uk 28 July 2016
TOP SLOTS: ‘Lowcost was regularly in the top three positions on Google’
“Given the margins… you would question that level of spend [on Google]”
already seen a cost reduction in Google’s AdWords auctions last week, as well as improved availability of some of the more costly travel terms on Google. Lowcost Travel Group ceased
trading on July 15. It was one of the pioneers of the dynamic packaging sector and its failure, which followed that of rival bed bank On Holiday Group in 2014, illustrates
First Choice also released
research suggesting almost 60% of UK adults feel “desperate for a break”, with 40% saying they will avoid news from home on holiday this summer. First Choice product director
Mark Hall said: “Holidaymakers are not being put off booking holidays. “More than ever before they
want to flee the UK, spend time with their families and switch off.” He suggested: “All-inclusive
holidays are increasing in popularity as customers want control over their holiday budget so they don’t have to worry about what they’re spending.” Latest figures from industry
analyst GfK reveal all-inclusive bookings for summer 2017 are showing the highest growth in a market that was up 16% year on year to the end of June.
the sector’s tight margins. Campion said few large suppliers now remain and he questioned whether there is room for any more. “It’s relatively easy to set these businesses up. Even if you are paying hoteliers after people have stayed, they will accept that as a standard credit term,” he said. “There are only two or three big ones left now. Whether there is room for another, I don’t know.” Travel Counsellors managing
director Steve Byrne said the failure raised questions about the high-
volume, low-margin business model. › Comment, page 36
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