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Tui halves Q1 losses despite €17m rebrand
Lee Hayhurst
lee.hayhurst@travelweekly.co.uk
Tui Group revealed it halved seasonal losses in the winter quarter despite spending €17 million on its rebrand from Thomson at the end of last year.
Europe’s largest travel firm said
the rebrand was “progressing very well” and demand for Tui holidays “remained strong”. In a trading update for the three
months to January 31, the first quarter of its financial year, Tui reported customer numbers up 4.4% and turnover up 9.1%, while year-on-year losses for the quarter fell by 57.9% to €25.4 million. As well as rebranding all 600 UK
stores, Tui embarked on a high- profile turn-of-year promotion with its “We cross the Ts, dot the Is, and put U in the middle” strapline. The rebrand boosted awareness
of the Tui brand to 44%, which chief executive Fritz Joussen described as a “strong number”. Joussen claimed Tui’s strategy
of investing in product was paying off, crediting it with the slashing of losses for the quarter. And he signalled more excursions,
transfers and activities being brought in-house as Tui focuses on its new Destination Services division as a “strategic growth area”. “Here we see great potential to
grow through the strengths and comprehensive presence of the Tui brand,” said Joussen. “Our customers trust the Tui
brand. This should help us deliver more and better service offerings and generate additional turnover.” Tui said investment in
customer relationship and yield management technologies would establish Destination Services alongside its cruise and hotel arms. The operator reported 65% of
UK sales now come online and had grown in part due to market share gains following Monarch’s collapse. Asked about future growth,
Joussen said: “Potentially there will be more [sales] online. I’m not fussed because we should be where the customers are.”
Peter Andre celebrates
Jet2.com’s 15th anniversary with Steve Lee (left), managing director Phil Ward and crew
‘Jet2holidays like Airtours in 1990s’
Lucy Huxley and Ben Ireland
Jet2holidays’ “aggressive expansion” is reminiscent of Airtours in the 1990s and presents challenges to established firms, according to a former Thomson Holidays boss.
Neilson chairman Richard
Bowden-Doyle urged rivals not to dismiss “the new kid on the block” as
Jet2.com – the airline behind the operator – celebrated its 15th birthday on Monday. He said: “Jet2holidays is
presenting similar challenges to the established players like Airtours did. “A lot of the smaller destination specialists are also coming under pressure. Jet2holidays is hoovering up a lot of beds, paying for year-round allocations and commitments. “It was the pressure on product
An image from Tui’s
turn-of-year campaign
by Airtours that led to the formation of Thomson’s differentiated product strategy years ago. “It’s very easy to be dismissive
of a company [like Jet2holidays], perceiving it to be operating at the
lower end and ignore it. There’s a danger of self-confident dismissal of the new kid on the block, and the next thing you know, they’ve stolen half your business.” Jet2holidays overtook Thomas
Cook as the UK’s second-largest Atol-holder as it turned 10 last year. Bowden-Doyle added: “Jet2holidays seems to have an aggressive pattern of expansion, which it can do coming from nowhere, rather than defending an established position. It looks like a player that believes volume is key and is genuinely creating a real dilemma for others.” The airline celebrated its
anniversary at Leeds Bradford airport where popstar Peter Andre surprised customers at check-in and sang Happy Birthday on an aircraft. In February 2003,
Jet2.com flew
two aircraft to nine destinations; now it operates a fleet of 88 aircraft carrying passengers to 65 destinations. Steve Lee, commercial director
since day one, said service and the airline’s down-to-earth ethos were the key to its success. “Fifteen years has flown by,” he said.
15 February 2018
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