As the online cruise and ski agency celebrates its 20th anniversary, its founder and chief executive reflects on the last two decades and looks ahead to Brexit and beyond. Harry Kemble reports
Few can begrudge Richard Downs his success. He set up Iglu at the height of the dotcom boom and celebrated 20 years in business in late 2018.
Downs saw an opportunity for an online travel agency for ski holidays in 1998 and grasped it with both hands.
The expansion into cruise followed the ski agency reaching a £1 million profit target in 2005, plus some persuasion from his friend Giles Hawke, now chief executive of Avalon Waterways.
Hawke talked Downs into taking his first cruise – a transatlantic sailing with Cunard. There was no turning back.
Today, Iglu trades in five countries and claims to be the largest continental retailer of cruise in Europe.
Downs is its softly spoken but determined chief executive.
His company’s online success means he fears for the future of bricks-and-mortar travel agencies across the country.
“I do not have a crystal ball,” he says. “But I think [high street travel agencies] will have to work harder and harder to attract footfall.
“I have held a similar view for the last 20 years. Consumers are moving online. If you are a high street agency, you need to have omnichannel capabilities; and if you are an OTA, crack on.”
Yet he admits shop agencies in remote areas of the country may have “sticky” or loyal client bases that can sustain their businesses.
“If they can find a way to leverage consumer business, then great,” he says. “If they continue to give great service then they will continue to get footfall into the store.
“If they don’t, consumers will go online. It is down to everybody to find out what they are good at. None of us take our customers for granted.”
Iglu investment
Last month, Wimbledon-based Iglu appointed David Gooch as commercial director, a role previously held by Dave Mills, who stepped into the newly-created role of global supply director in September.
The recruitment of Gooch, a former Thomas Cook e-commerce director, follows a long list of appointments made with a view to maintaining Iglu’s growth overseas.
Simone Clark’s move from managing director to senior vice-president for global supply in 2017 and Mills’ elevation are two of the most notable. When we started, we were in one country and now we supply five,” Downs explains.
“Dave [Mills] and Simone are building these new relationships, and that was taking them out of the office. Dave loves that stuff and he is brilliant at it, so we needed to fill that void.”
Downs is speaking just a few weeks before the wave period gets under way.
It is a time of the year that he knows well. After all, he chose to diversify from an online ski agency, heavily influenced by seasonality, to an year-round cruise business.
“[Gooch’s appointment] is an example of us investing in the team,” says Downs.
“It enables us to grow the business and will allow us to be as competitive in the marketplace as we can be.
“We represent the cruise lines’ product in the wave period. From a product and commercial perspective, it helps us put our best foot forward without giving any margin away.
“We are very bullish about 2019.”
Brexit impact
It is impossible not to ask Downs about Brexit as the nation limps towards its scheduled divorce from the EU on March 29.
Downs commutes to southwest London each week from Barcelona, where he lives with his family.
With Iglu now trading in four European countries outside of the UK – Ireland, France, Italy and Spain – Downs is better placed than many to opine on how the cruise industry will fare when Britain eventually leaves the EU.
He says it is “very difficult” to know what will happen. “It is a political conundrum, and nobody knows how to solve it.
“We are entering crazy, unchartered shenanigans, but we have got confidence in the industry.”
Downs’ upbeat assessment is due in no small part to the fact that Iglu’s cruise and ski sales are up year on year for 2019 and 2020.
He notes previous challenges that cruise has overcome in the past 20 years. Asked to recall the toughest, Downs does not hesitate in responding with the words “Costa Concordia”, describing the 2012 shipwreck as “one of the toughest challenges of the past 20 years”. He also cites the impact of the financial crash of 2008 on holiday bookings.
Cruise resilience
Downs says the fact that a cruise holiday is “more inclusive than most holiday products” will help the industry navigate its way through 2019.
“If following Brexit there was an exchange rate depreciation, then the cost of food and accommodation is all included in a cruise fare,” he explains.
“That might encourage people looking at both land-based holidays and cruise [to plump for the latter] because the value proposition of cruise is better.”
Furthermore, Downs says passengers who sail with P&O Cruises will be heartened that everything on board is priced in pounds.
“Cruising is a real hedge and helps cushion a natural [economic] blow,” he says. “The cruise industry is hugely resilient.”
Looking ahead, he adds: “It is going to be an exciting 2019. I go back to the cruise line partners that have had a 20-year track record of building ships.
“There is a very high probability that the capacity that is coming in 2019 and 2020 will meet the [passenger] growth.
“There are new lines being talked about such as Virgin Voyages and Ritz-Carlton. They are additives to the whole cruise industry.”