Travel brands will have to rebuild trust among consumers following the refunds controversy and reposition their businesses to be more domestically focussed.
An expert travel industry panel on the latest Travel Weekly Webcast said all firms will have to invest more in customer service with trust in the industry now at a low ebb.
Alan Bowen, legal adviser to the Association of Atol Companies said stories of leading firms like Tui not paying their suppliers have only undermined consumer trust in the sector further.
“If you’re a small operator using a hotel that’s used by large operator who hasn’t paid the holidays that have already taken place, and you as a small operator have to cancel a booking the hotel can’t give you the money back because it hasn’t been paid by the bigger operator.
“So it’s running right through the whole system. And, of course, the problem is the publicity that this story and similar stories has got is it’s telling the consumer that tour operators don’t pay money in advance to hotels.
Paying upfront
“People don’t believe you when you explain that for a small operator if you don’t pay, you don’t get the room. And they don’t even believe now that we pay airlines before departure.
“Trying to explain that that isn’t the way it works unless you own an airline is a real problem because the consumer thinks were lying.
Question of trust
“The problem is that’s a question of trust. People don’t believe what we’re telling them.”
Paul Charles, chief executive of the PC Agency, said “the trust barometer is very low” for travel because it did not “get off to a good start” over the refunds issue.
Charles said: “There are going to be two things needed in due course. One is undoubtedly going to be repositioning, not just restructure as they try to restart, but reposition what they are for.
“Travel brands are going to have to ask themselves, what are we for now? Where are we focusing on? How are we going to show that we care?
“And secondly, as part of this reset, it’s is going to be about how responsible you are as an operator.
“Customer care teams are going to be the ones that are invested in. They’ll become more caring, and the initial answer will be perhaps more of a ‘yes’ than a ‘no’.”
Domestic focus
Charles added he would advise travel agents to focus on domestic travel in the short term.
“If I was running an agent, I’d be looking at growing my domestic business in light of the fact I won’t be selling as much international business.”
Brand values
Giles Hawke, UK chief executive of Cosmos, said the brand was currently not back into sales mode despite getting enquiries from agents wanting to book 2021 for customers.
And he agreed that what a brand stands for will become more important in a post COVID-19 world.
“There’s something about trying to be clear what you stand for to customers, why they should book with you as a tour operator, as a travel agent.
“Explain the value you add, the way you work, the values you have as a business. We’ve got business values, and we already communicate those, but we need to do a much better job of communicating our values. We probably don’t talk about them openly and publicly enough.
“Operators and travel agents will probably score well in the customer mindset in the future because we’re human beings running businesses, and businesses have values and those values sit within the people that work within those businesses.
“I’m proud of the company I work for. We’ve got clear values and we stick by them, we do the right thing. We’re refunding customers. We still have to pay our suppliers and we’re paying our suppliers.
“Sometimes that hurts from a business perspective, but those companies just focusing on shareholder value rather than their customers and business partners, I can’t see customers or partners are going to value them in the future.”
