Heavy discounting by high-street multiples is hitting early bookings for the domestic market, according to Thomson Independent Holiday Group managing director Peter Chappelow.
Speaking at a Tourism Society meeting in Greenwich, Chappelow said the 30% discount levels – started by sister company Lunn Poly – are sending the wrong message.
“We used to get 30% of our sales before Christmas but now we are lucky to get 25%,” he said. “Consumers now think there is no need to book in advance when discounts keep rising.”
Sunvil Holidays managing director and Travel Weekly columnist Noel Josephides criticised the trade for reacting too soon and offering discounts for people who would have booked anyway.
He added the short-haul package holiday market may have reached saturation point.
“You can always tell when it’s struggling. There is wholesale panic,” said Josephides. “Even with 30% discounts, it did not make much difference to the market.
“Yet retailers say people booking now would have booked anyway. We are giving away margin to those who don’t expect it.”
He added the consumer has cottoned on to the practice of offering discounts on “bits and pieces”.
“The consumer knows all the tricks. There’s a feeling that it’s all a bit of a con,” he said.
Josephides added that overcapacity in Greece and Cyprus will cause “enormous problems” while Spain is becoming too expensive.
Chappelow added while the long-term prospects look encouraging, with more people taking UK breaks as a second holiday, he expected a tough time over this year with the weather and strong pound being major factors.