UK industry veteran Richard Carrick told peers at the Barclays Travel Forum that paid search works better if seen as a cost of sale rather than as part of marketing.
‘If you get the returns, then there’s no reason not to spend,” he said.
Carrick is chief executive of self-catering specialist Hoseasons. His CV also includes a number of board-level roles with MyTravel, as was, including UK MD and CEO of its global development unit.
In response to a question from the floor, he said that “how you reached the customer was relatively easy” referring to the travel sector’s traditional off-line campaigns after Christmas and into the New Year. “It was a well-established.”
However, paid search today enables a travel business to respond to market conditions. “You can turn your online spend up and down as you go,” he said. It also helps the balance sheet – under the old model the return from a Xmas/New Year push came in a different financial year from the cost of the campaign.
The conditions which Hoseasons are exposed to are as much metereological as macro-economic. He said that good weather in the UK was good for business, where most of its inventory is located. Hoseasons needs to be able to respond to this, getting its brand and product front-of-mind for today’s “promiscuous customers”.
However, Carrick is aware that a big online push means that the business needs to be staffed offline to cope with the peak. The business has started to employ dedicated Hoseasons homeworkers as a result after successfully trialling improved technology.
Currently, around half of Hoseasons bookings are made within four weeks of departure. The business gets around 35-40% of its business through retail travel agents, and has recently started shifting inventory through lastminute.com.