Tui Travel has indicated that it will not be rushed into changing its pricing strategy in the wake of rival Thomas Cook’s move to single prices across its retail estate and online.
Tui has also ruled out any reduction in commission rates in the peak sales period, following speculation that Cook’s move was likely to result in changes to commercial deals with third-party agents.
Tui had previously made it clear that it intended to move to a single price strategy in the future, and was also considering service charges and changes to its commercial agreements with third-party agents. However, it was not expected to make the move until late 2014.
Cook today said it would be moving to single pricing for its own-brand charter packages with immediate effect, echoing moves by operators such as Kuoni, which earlier this year removed its 5% web discount to create level pricing on its website and shops and through third party agents.
John Boughton, director of ancillaries and commercial for Tui UK & Ireland, indicated there would not be any knee-jerk reaction to Cook’s announcement.
“We recognise that customers want great value holidays whether they book online or in retail shops. It is also clear that the industry is evolving with prices becoming much more transparent across multiple distribution channels,” he said.
“As part of our on-going modernisation strategy, we too are examining options for our future pricing approach.”
He added: “We will continue to ensure that any decision made is based on what is best for our customers and what fits with our business strategy.”
Referring specifically to commercial relationships with independent agents, he said: “We can also confirm that we have no plans to reduce or cut third party agent commission for turn of year.”
A spokesperson for Virgin Holidays said the nature of its product meant it had no immediate plans to change its pricing strategy.
“We’re not particularly surprised by this move, as flat pricing lends itself well to the charter tour product,” the spokesman said.
“We’ll follow consumer and market reaction with interest, but our channel-specific pricing strategy works well for us and we’ve no current plans to change.”