On the Beach chief Simon Cooper hailed the OTA’s “bold strategy” in targeting five-star travellers as he reported premium bookings comprised more than half the company’s revenue in the six months to March.
Cooper reported a “strong performance” in the half-year results despite noting “volumes in the value segment” of the market “have not yet recovered to pre-pandemic levels” due to cost-of-living pressures.
He noted: “Of the largest package operators, we’re one of the most exposed at the value end of the market.”
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But the company had capitalised by “repositioning into the premium market”, he said, with bookings of five-star holidays up 17% year on year and “more than double pre-pandemic levels”.
Cooper told Travel Weekly: “It was a bold strategy to access premium customers while not leaving behind our value customers.”
The company – which combines online travel agent On the Beach, tour operator Classic Collection and the Classic Package Holidays dynamic-packaging platform for agents – looked to boost its premium offering during the pandemic.
Since travel’s post-pandemic resumption, it has sought a greater share of customers “willing to spend more by travelling further, selecting a five-star hotel online or booking a premium holiday through a travel agent”.
Cooper reported On the Beach had moved from a customer split of 85% ‘value’ and 15% ‘premium’ pre-pandemic to one of 50/50 on turnover “or just in favour of premium”.
He said: “We doubled our premium bookings and we expect to keep growing in premium.”
On the Beach retains an OTA business in Sweden, but Cooper said the company would not be looking to follow the example of rival OTA LoveHolidays by expanding into other source markets in Europe.
He argued: “In the last 10-20 years there are very few examples of online brands that achieved the same level of success in an overseas market as in their home market.
“Our decision to expand into premium, B2B and long haul is already paying dividends. The pay-off is quicker.”
Cooper added: “If we were to expand internationally, it would more likely be by acquisition.”
He said: “We’re always evaluating interesting businesses.”
On the Beach reported a half-year loss of £6 million to the end of March, with passenger numbers up 11% year on year and 8% up on the same period in 2019.
Cooper is due to stand down as chief executive at the end of June when current chief financial officer Shaun Morton will take over.
The company has previously announced Jon Wormald, currently with e-commerce group THG, will join as chief financial officer on June 30.
Cooper, who founded On the Beach in 2004, will remain on the board as a non-executive director.
He said: “Obviously I won’t be involved on executive business, but I’ll maintain a significant shareholding in On the Beach and a healthy interest.
“I’ve always believed in recruiting well and standing back. Shaun and I worked closely over a long period of time.
“It’s difficult to quantify the time I’m likely spend [on it]. I will work more closely with the executive team than other non-executive directors.”
Cooper added: “I’ll broaden what I’m involved in.”
However, he declined to give details, saying: “There are a number of things but they are yet to be formalised.”
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