TUI Travel and Thomas Cook will continue to use their high street shops to present their brands, and are in a position to reassert themselves as the main sources for holiday bookings, a report by market analysts Key Note predicted.
The two largest holiday companies control more than 40% of UK travel agency branches, according to ABTA statistics, including a higher share of the large, prime location outlets.
The Holiday Purchasing Patterns Market Assessment 2009 report said both companies had the potential to increase online bookings. In 2008, Thomas Cook’s online sales reached 28% of total bookings.
The report said: “They [TUI Travel and Thomas Cook] have the financial muscle to strengthen their position in internet travel bookings, the channel that was initially seen as their Achilles heel.”
It added: “By reaping the benefits of online travel, consolidated travel agents are in a position to reassert themselves as the main source for booking holidays, offering a choice of independent bookings and dynamic packaging. They are also in a position to guide consumers back towards package holidays.”
The report took into account the reduction in size of retail estates Thomson, First Choice and Thomas Cook in recent years, but maintained the future of larger branches was secure. It said: “Larger branches remain open and will continue to be important for their parent companies by mainly selling their holiday brands.”
Approximately 60% of holidays sold through multiple travel agencies are those owned by its parent company.
The report also showed that, up to March 2008, agents lost their dominance in selling package holidays, but retained their importance for accommodation and flight-only bookings.
Research by the Target Group Index (TGI) between 1999 and 2008 showed the number of respondents who visited a travel agency to book a package, flight only or accommodation only, fell from 21.9% in 1999 to 16.4% for the year ending March 2008.
But the use of agents for booking accommodation-only went up in the period, from 2.1% in 1999 to 2.9% in 2008. However, using an agent to book room-only fell from a peak of 4.1% in 2005.
Meanwhile, 3.8% of respondents used agents to book flights in 2008, just below the 3.9% in 1999. But usage increased to 5.6% in 2005, showing agents became increasingly popular for flight bookings before falling towards the end of the period.
In contrast, the amount of holidaymakers using an agency to book a package holiday steadily declined, from 15.9% in 1999 to 9.7% in 2008.
Using an operator to book a package or flight-only went up from 8.1% to 9.1%. But the sharpest increase came from respondents booking holidays independently, up from 26.5% in 1999 to 36.8% in 2008.