Many years ago, there was a company called Holidayfax started by Ian Champness, now of FSS. Holidayfax had a service called Late Late Gatwick.
We tour operators would enter seat capacity via Istel, I think it was, from our Prestel set and the system could be accessed by anyone on the system and a booking made which was, of course, guaranteed and an automatic fax generated to us.
If the capacity was sold in the meantime, then it was our responsibility to contact the client/agent and dig ourselves out of the hole.
This system was way ahead of its time and the world was just not ready for it. Now, such a company would be worth a billion!
What we have now with the Web is a Holidayfax on an enormous scale which can also deliver pictures. Where Holidayfax was unique we now have a multitude of companies, including the celebrated lastminute.com, offering what is really the same service and, currently, no more sophisticated than that which existed all those years ago. Very boring really.
The other problem with Holidayfax was that all tour operators had excess capacity to sell on the same routes and on the same dates so prices just chased themselves down. So, when you really wanted to sell something, you just couldn’t.
Just imagine the scale of the problem now. The majority of the ‘distressed stock’ type sites that contact us, because they cannot offer direct on-line access to our own computer systems, want us to give them allocations of capacity so that they can sell it on our behalf. This makes it seem to the public that they do have an on-line facility to us.
But how many of these sites can we operators manage at the same time without forgetting to update capacity availability? The answer is probably no more than one or two, including the operators’ own sites. Therefore, the operators would be doing all the work and, going by what we hear lastminute.com and others charge in commission, pay dearly for the privilege of selling very little in the low season because everyone else is selling cheaply too.
After over 25 years in this industry, all I can say to lastminute.com and those that have invested in it is that there is just no money in selling last-minute holidays at low, low prices.
This is not a serious business to be in. It is an unfortunate aspect of our industry, born of tour operator optimism, greed and incompetence and one which would drive us all into bankruptcy if we allowed the Web to become no more than a series of lastminute.com type sites.
So, I was disappointed to read the names, listed in the last week’s Sunday Times, of the planned Thomson sites. You have latedeals.com, laststop.co.uk, holidaydiscounts.com and skydeals.co.uk. God help us is all I can say.
Anyway, the Web initiativedidn’t help the share price much and yet the City has valued a company that will never make the money to justify its valuation at more than Thomson. Read this, merchant bankers, and do your corporate clients and the public you influence a big favour. There is no long term or even medium-term money in last-minute discounted selling.