Tui’s move to close 166 shops and create a homeworking team could be of long-term benefit to high street independents but may also confirm the “rise of the homeworker”, travel agency rivals say.
Julia Lo Bue-Said, chief executive of The Advantage Travel Partnership, said “less competition” on the high street could benefit independents on the high street but warned the loss of Tui from many high streets was “a negative” in the shrt-term.
She said: “In normal trading times I would say that less competition is beneficial to members [independent agents] but as we come through this [Covid-19 crisis] the high street will have changed. Long-term it’s certainly a positive to independents, however [Tui’s closures] potentially creates a high street that consumers don’t flock to. If there are less businesses, it diminishes the benefit of the high street,” she said.
“Who knows how it might look over the next few months. Consumers still want to go to their agency, but in the current climate less brand-name retailers we have reduces that choice. We’ve already seen the high street contract over the years.”
Lo Bue-Said said she did not expect Advantage’s members to follow suit by reducing their retail presence, but said many were “complementing” high street operations with an out-of-hours service from home.
“Independents need the high street as it’s the hub of the community and they’re part of their local community,” she said. “What the Covid pandemic has done has helped them evolve their models. That might involve enabling staff to work from home, but I’ve not seen a mass reduction of high street presence.”
Paul Harrison, co-founder of homeworking group Not Just Travel, said: “The recent news from Tui switching retail staff to homeworking positions reinforces what we have known for a while, that the rise of the homeworker is here, and post Covid is getting stronger.
“Today companies are realising the cost benefits of having people work from home, so the company does not have the massive overhead – what the savvy employee will realise is that they can become their own boss from home, start their own entrepreneurial journey and build their dream instead of someone else’s.”
Lo Bue-Said suggested that Tui’s shift away from some high streets would not independent agencies because of the different business models.
“Independents sell a huge range of products, whereas Tui’s retail network provides stores to sell Tui holidays,” she said. “What this demonstrates is the benefit of the independent to the consumer in terms of the choice they offer. They are there to service the customer, whether that’s with a Tui holiday or any other tour operator. They are the experts and its important they become more vocal about that.”
Jo Causon, chief executive of the Institute for Customer Service, suggested a shift of consumers focussing on digital channels throughout the Covid-19 pandemic. But she said the most important factor in the ICS’ consumer research was offering “genuine advice” – regardless of what channel that is given via.
She said: “Throughout the Covid-19 crisis, we have seen an increase in consumers favouring digital channels over face-to-face interactions. The reasons for this are obvious, but customers are still seeking advice and support – in particular to help them make informed decisions in this time of heightened uncertainty.
“The organisations that have been succeeding tend to serve their customers through knowledge sharing and by providing genuine advice, rather than simply trying to sell. They communicate clearly and give customers a choice – be it the channels they can use, changes they can make or their refund options. In this sense, they currently have an opportunity to differentiate themselves by the service they offer – not the price they charge or just their location.
“Clearly the trading environment for the travel industry is going to be extremely challenging in the short- to medium-term, and this is going to require some tough decisions. Balancing the need to operate efficiently with the need properly service customers will prove a challenge for many. But the two aren’t mutually exclusive, and our research shows that higher customer satisfaction typically leads to higher profitability, increased productivity and enhanced customer loyalty.”
