THOMSON and Thomas Cook have pledged to take on the online retailers next year by developing their dynamic packaging and web capabilities.

Thomson sales and marketing director Miles Morgan said the operator will beat Expedia and Lastminute.com with the technology it is developing.

“The biggest change in 2006 will be around dynamic packaging,” he said. “We are designing our capability on the web and in our shops. We will build technology that will be better than Expedia and Lastminute. We are the number-one visited travel retailer site.”

Morgan said the technology will allow shop staff to book other product, not just Thomson’s, by tapping into the systems of other charter and scheduled carriers.

TUI UK head of third-party sales Jean Lally said the technology will be available by March. “We will have the capability to dig into other people’s inventory,” she said.

Thomas Cook will relaunch its website this month after an overhaul. Chief executive Manny Fontenla-Novoa said the site will go head-to-head with the likes of Expedia. “A lot of people are scared of Expedia, but I’m not,” he said. “It does have good technology, but we have a fantastic brand and heritage.”

Lastminute refused to comment, but a spokesman for Expedia said: “There’s room for everyone.”