If only “Differentiation” was a Christmas Present

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Thomas Cook recently announced a new strategic direction, focused on increasing its “Differentiated” product from a claimed 30% to a healthy 50%. But what exactly is “Differentiated” product??
The tour operators seem to have been slow to define this! My own definition is very simple “ Product demanded by customers, which can only be brought from that tour operator”. The key phase, which makes defining differentiated product hard, is “demanded by customers”. There is little point having “Exclusive” product that you cannot sell, because customers are buying the hotel next door for £50 per person cheaper!!!

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Me too says Thomas Cook…but is that wrong?

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On Wednesday, after a torrid build up, Thomas Cook‘s management team got to announce its new Corporate Strategy….or was it TUI’s strategy they announced?…..Difficult to tell, considering how similar they now are! However, is it wrong to copy the “Right” strategy?

Personally, I think not, with Thomas Cook now clearly heading in the right direction in my opinion. Given the rapid advance of lower priced dynamic packaging, it is essential for traditional tour operators to differentiate their product by adding value to its proposition by investing in hotels, staffing levels and in-resort infrastructure to improve the quality of the holidays they offer. Therefore, the stated aim to increase their differentiated stock from 31% to 50% must be the right direction. However, in a cash strapped organisation this may prove difficult to achieve, since differentiation often equates to the long term commitment of cash and a considerable increase in risk stock and company gearing.

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My Review of Antigua….

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I was lucky enough to be in the Rock Insurance Party who won the inaugural Antigua sponsored sailing Regatta that took place in Southampton in September. Actually to be truthful I was too busy that day but once I found out that they had won the event and an all expenses trip to Antigua to go sailing for 3 days I pulled rank!!!

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Ryanair’s Million seat gamble

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After years of ignorance, Ryanair have finally realised how many agents were booking their flights and packaging them into holidays, due to the heavy use of credit card surcharge avoidance techniques via virtual booking cards. Hence, in some ways the trade can only blame itself for the aggressive two pronged attack on travel agents Ryanair has launched this month, because in colloquial speak, the industry have “had Ryanair’s trousers down and given them a good financial spanking”

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Are On the Beach on the right payment track?

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On the Beach off the back of their move to offer ATOL protection to its customers have now decided to allow customers to pay for their holiday 30 days before departure rather than the traditional 90 days still offered by its competitors.

Cynic’s in the industry claim that this because the customers funds are protected in a trust fund and can not be used to fund marketing. Hence, if it can not be spent, why collect it?

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Flight Plus TOMS Open letter to ABTA and CAA

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To Luke Pollard/ Andy Cohen

Cc Mark Tanzer

Flight Plus TOMS VAT

Luke, as discussed on the phone I am concerned about HMRC seeing Flight Plus as an opportunity to broaden the net of TOM’s VAT to include travel agents that are dynamically packaging. I therefore think its imperative that ABTA as our industry body, seeks written guidance from HMRC as to “exactly” what contractual arrangements must be put in place once Flight Plus ATOL’s are introduced in April 2012.
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Endacott calls for CAA to give clarity over “knock on” issues of Flight Plus ATOL.

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You begin to wonder if the CAA is playing a clever game by further delaying the release of the consultation paper on the Flight Plus ATOL reform.
As an industry we seem to be slowly accepting that Flight Plus is inevitable and that we just need to make the most of it, until airlines are brought in sometime in the future via the much needed “Primary Legislation” (Just witness the ABTA Matters debate)
However, even this defeatist attitude still requires the CAA to deal with two fundamental issues. Continue reading →