Special Report: Trade reacts to Virgin Holidays decision

A week on from Virgin Holidays’ announcement that it is to become a direct-sell-only operator, we round up the views of leading agents and operators

Gary Lewis, Group Managing Director, The Travel Network Group

“Virgin Holidays has to make the right decision for their business and their relationship with their customers. As a brand they have been sending messages for a while about where they believe they need to be as a business, and this decision is not a surprise and comes when the statistics tell the trade they have already stopped supporting them in volume.

“For The Travel Network Group Members the decision simply reinforces our own strategy for independent distribution, and we are supporting those suppliers that are supporting us.

Gary Lewis“With 200 business partners and 60 preferred partners the product range and support from our trade partners has never been stronger. With the biggest move in the last twelve months being the Goldmedal and Travel 2 tie up with Dnata.

“As a combined entity this introduced another heavy weight player to the industry who recognised and rewarded the independent trade. Dnata is a company that keep proving they have long-term ambitions to grow their independent distribution. They have a tremendous record of not changing with the tide and supporting long-term strategy.

“Travel 2 and Goldmedal have engaged consistently at all levels with independent distribution. Of course many many others are doing the same, including RCCL and Celebrity to name two in the cruise sector, who are also following a independent retail strategy.

“Our own member Premier Holidays is another brand that understands the value of independent retail distribution who have their own direct shops to control some of their mix. And, Barrhead Travel, our newest member, has also moved into areas of controlling the whole customer journey.

“For our Members we continually talk about our responsibility to help them carry on owning the relationship with their customers. It is our belief that independents still have a huge skill and potential to do this better, with greater insight and entrepreneurial skill than many of the big boys.

“It’s this that will keep our Members changing to adapt to whatever challenges are thrown our way. Price parity, trade support, clear ambition to grow independent distribution and a recognition of the skill and investment in training to sell supplier products. This is what we look for because this is what builds trust.”

Julia Lo Bue-Said, managing director, Advantage Travel Partnership

Lo Bue-Said questioned Virgin Holidays managing director Mark Anderson’s comments that the brand would ‘make holidays come alive’ by going direct.

Julia Lo Bue SaidShe said: “The reasons given to us are that they want to control the end-to-end customer experience. Does this mean the service agents deliver isn’t up to their expectations? It certainly doesn’t demonstrate that they believe it’s a good one [service].

“Over the past 10 years Virgin Holidays have followed a policy of discounting their products to customers and offering a discount for booking direct – forcing agents to switch-sell to other partners.

“I believe this is now a great opportunity for agents to engage with and support those suppliers that truly value their business.

“In such a competitive market, grown-up decisions need to be made as to which partners are worth backing.”

Miles Morgan, managing director, Miles Morgan Travel

“This comes as no surprise. I have been saying forever that you can’t build a retail travel business with a company that wasn’t willing to work with you.

Miles Morgan“They offered reasonable commission but you could never make it because they would always undercut with discounting.

“They say they want to ‘own the customer’ but, really, they hijacked the customer.

“I have had my business for nine years and we’ve never sold Virgin Holidays – the writing was on the wall that this was going to happen.

“In an ideal world, we would have worked with such a well-known brand. But they did nothing to encourage a relationship.”

Amanda Matthews, managing director, Designer Travel

“Virgin Holidays is saying it wants total control over the overall customer experience so that it is the best, but I would challenge them to prove that they offer a better service than we [agents] do.

“The fact they think they can enhance the experience of a good travel agent is a joke. I think they are underestimating the extra mile that we go to for our clients.”

Stephen Rhodes, managing director, Funway Holidays

“I’m surprised the operator didn’t make the decision sooner.

“Virgin Holidays was known for its different pricing strategy, particularly during special sale periods, which seemed to happen increasingly frequently.

“The decision to go direct creates clarity for the travel agent. Previously, a customer wanting to travel with Virgin Holidays was an easy booking, rather than requiring the agent to cross-sell to a trade-friendly operator.

“There will be more business ?for agent-focused operators such as Funway but, given Virgin Holidays’ decline over the years, I don’t think

it will be an enormous amount. “It’s interesting that our two major airlines – British Airways and Virgin Atlantic – now both have holiday businesses that are solely direct.

“Will British Airways now ?follow the Virgin model and start to open retail shops and concessions? That would be a brave and interesting move.”

Stuart Wilson, managing director, Blue Bay Travel

“I am not surprised by this. For too long, Virgin Holidays has been losing ground to trade-friendly operators.

“They have an exceptional consumer-facing brand, and as there are more trade-friendly operators out there, this is a sensible business decision.

“Like everyone else, our business with Virgin Holidays has diminished over time.

“The operator has well-trained staff and my thoughts are with anyone who might lose their job as a result.”

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