Industry bosses have reported a drop in demand for European holidays this summer amid Brexit uncertainty.
Miles Morgan Travel, Celebrity Cruises and Icelolly.com said the short-haul market was under pressure but customers were turning to long-haul or booking further ahead, which was mitigating the impact.
Jo Rzymowska said: “From a UK and Ireland point of view we’re seeing some reticence for European cruising. But the good news is the US market is not seeing that and long-haul is very strong.”
Miles Morgan, owner of Miles Morgan Travel, said: “Short-haul is more of a challenge, especially the eurozone. But overall the picture is positive – we’ve seen a lot more bookings for 2020 and beyond.”
Morgan also said he had seen a broader mix in the types of holidays being booked, with cruise and escorted tours performing well.
“It’s about understanding the data and what’s going on and backing the winning ticket – stick it in your window and stick it on your website. Go for it!” he added.
Richard Singer, chief executive of Icelolly.com, said larger OTAs had bolstered their marketing spend to drive bookings, but added: “The market is 100% softer in European short-haul. When I met with Google six weeks ago, we looked at search terms around cheap holidays and package holidays and they were down year on by year 20%.
“Finding new customers is a challenge because if your market is smaller then your marketing becomes less efficient and less profitable, but if you have ambitions to grow you have to be in the mix.”
Alan Cross, head of trade sales at Jet2.com and Jet2holidays, described the market as “aggressive”.
“Customers want to buy holidays, but they want that reassurance,” he said. “If you think customers are just going to walk through the door, forget it. Agents have got to be proactive. Those that are, are getting positive results.”
Morgan said that while Brexit was a “bump in the road”, it did not compare to the financial crisis of 2007-09 and agents were in a strong position to adapt to changes in the market.
“So much of it is an attitude of mind as a travel agent.
“The lucky thing for us is we can sell whatever we like. If the market is all about cruise, we can sell cruise; if it’s about escorted touring, we sell that; we can sell short-haul, we can sell long-haul. It’s about seeing what’s going on, reacting to it and promoting it.
“When we go through a situation like we are now, people are nervous about spending marketing money, but instead of cutting back I have the opposite view and spend more to get a bigger share of voice and get more customers.
“There are bumps in the road and this is a big one, but the overall view has got to be positive because people still want to travel.
“Brexit does not compare to the recession of 2007-09. Household incomes are stable and employment is up.”
Rzymowska: We must not perpetuate the negativity
The UK boss of Celebrity Cruises said the industry must not “talk itself into a downward spiral” over Brexit.
Jo Rzymowska said many consumers’ buying habits were heavily influenced by the media but she urged the industry not to “perpetuate” negative publicity following a series of travel chaos stories in the mainstream media.
Figures from industry analyst GfK showed pre-Christmas bookings fell following a report in The Sunday Times headlined “No-deal Brexit travel warning: don’t go on holiday after March 29”.
Numerous media reports since have predicted mass queues at European airports, passports and driving licences becoming invalid and prices soaring if the UK leaves the EU with no deal.
In response, Abta last week launched a radio and Facebook advertising campaign reassuring consumers they can book holidays with confidence whatever the outcome over Brexit.
Rzymowska, Celebrity
vice-president and managing director for the UK and Ireland, said: “We should commend Abta for its campaign because we can talk ourselves into a downward spiral and we then precipitate the problem we are in.
“People still want to go on holiday, and some of us are in a market where deals are not the be all and end all, so it’s about making sure that product delivery is brilliant and making sure customers have the best holiday.
“When you have assets, you have to make sure you are doing all you can to differentiate that product and help trade partners understand the difference between products.
“Yes, the media drives a high percentage of consumers who believe in everything they read, but unless we as an industry continue to get behind what we do, then we just perpetuate that.”
Icelolly.com chief executive Richard Singer said: “We can tell people to go on holiday, but when the Daily Mail says the Europeans don’t want you, the Spanish haven’t got its airports sorted, or that you’re going to be waiting 17 hours at an airport and you’ll have no money if we crash out of the EU, it clearly has an impact on how people feel. That is the challenge.”
The government would not survive in business world’
The government would not survive “one minute in business”, based on its handling of the Brexit negotiations.
Celebrity’s Jo Rzymowska said: “We [the UK] are in a mess. None of the people in government would survive in businesses. Can you imagine saying: ‘I’ll think about it and come back to you’. It just wouldn’t happen.
“The fact they have been allowed to carry on the way they have, in the commercial world, they wouldn’t survive a minute and that’s highly frustrating.”
But she said that despite the uncertainty, people still wanted holidays.
That view was echoed by Miles Morgan Travel’s Miles Morgan, who said: “People from the UK will always want to travel abroad.
“Holidays are more of an essential than they were 10 years ago. But it’s not an easy market. You have to go after it.”
‘Thomas Cook is sandwiched between rivals’
Thomas Cook is caught “in the middle” of its rivals but the appointment of Will Waggott is a “positive” move for the group.
Miles Morgan, owner of Miles Morgan Travel, said: “Tui is in a very strong position with its differentiated product. Jet2holidays is doing a brilliant job at a much lower cost base than Cook. So Cook is sandwiched in the middle and that space is a very difficult space to get out of.
“Where do you go? Up or down? Can you secure bed deals like Tui? That’s clearly the way it’s trying to go.”
The panel praised Cook’s decision to appoint former Tui Travel chief financial officer and Travelopia chief executive Will Waggott as chief of tour operating last month.
“Will’s appointment is good,” Morgan said. “He’s a nuts-and-bolts tour operator, which is exactly the sort of person they need to get themselves out of where they are.”
Richard Singer, chief executive of Icelolly.com, praised Cook for holding its ground despite slashing its marketing spend, but warned that the package holiday market would become more crowded.
“Obviously fundamental changes need to be made to the business,” he said. “The whole package holiday market is getting more competitive. On the Beach is getting more aggressive; Love Holidays has just been bought…they’re the ones taking share in terms of that package market.
“We’ve also got easyJet Holidays coming on stream next year [and] not looking to just white-label [but to be] a full-on operator business.”
Celebrity Cruises’ Jo Rzymowska said: “Cook is the most-trusted brand in travel and they are going through a really tough time.
“But with Will (Waggott) coming in, that’s a good move overall, and we want to do everything we can to support them. We’ve been in partnership for years so it’s about seeing how we can work together through this tough time.”
Morgan says agents show their merits in times of crisis
Travel agents can benefit in times of crisis as consumers seek reassurance and expert advice.
Responding to a question about whether the Ethiopian Airlines crash on March 10 had raised concerns among his customers, Miles Morgan, owner of Miles Morgan Travel, said: “Whenever there are issues – terrorism, aircraft crashes – the value of the high street agent comes to the fore because customers have the comfort of going to speak to someone and asking ‘which plane am I flying on?’
“So, perversely, I see any kind of issue as a positive, because people can see a tangible difference in having a physical bricks and mortar agency [where] they can go and ask, and which they trust.”
