Capacity cut by 20%. Some 500,000-600,000 fewer holidays outbound from just one travel firm. The national media is looking for a big story in travel – it not being content with the other strategy of scaring the hell out of consumers in late-April with the threat of a global pandemic with Swine Flu.
A newspaper journalist got in touch recently to ask about prices, capacity, popular destinations and the like. Throughout the discussion the reporter was itching to find out if we thought a price war is likely in the summer. “And holidays will probably be, say, a couple of hundred pounds cheaper, then?” he asked hopefully, mentally preparing his headline.
It is, despite coming perilously close to the middle of the year and decision time for many travel firms, probably still unclear if prices will drop across the board and consumers will have the enjoyment of a late-booking bonanza – or at least to the level where it warrants a splash in the national media.
Nevertheless, there are signs that travel companies are preparing themselves for some action in July and August. What we do know is that the big two operators, for example, say there are around a fifth fewer holidays for sale this year – but, as we move closer to the summer holiday period, there is certainly availability left in some destinations, particularly in the western Mediterranean.
One way of gauging what may happen is to talk to some of the big ad-buying agencies, especially those handling keyword buying budgets on the internet – the area where so much of the late-booking marketing activity is likely to take place.
There are indications that the online adspend of many travel firms stuck to agency forecasts for the first six weeks of 2009, but then tailed off dramatically into March and April.
Some media folk speculate that budgets were held back not just to save money on marketing but, crucially, to add to a sale frenzy marketing warchest for activity come the summer.
This is undoubtedly good news for the agency community and Google but, equally, could send a shiver down the spine of companies that didn’t keep a little bit back in case of a whirlwind of bidding on travel-related keywords.
To muddy the water further, another theory being floated around concerns the ultra-lates market.
This is where a not-insignificant number of consumers are waiting until the autumn of this year before (the school half-term in particular, is a likely period) booking a holiday, such has been their concern over job security, inflation and the like.
It is thought that by the third quarter of 2009, many will have a better indication as to their finances and will be seeking a quick getaway after sitting tight for most of the year.
This particular consequence of a wholly unnatural year will have at least two knock-on effects – a boost for the mid-haul sector (where the weather will still be balmy enough for sun-hungry Brits) and dynamic packaging agents who can grab stock from un-contracted suppliers. And, lest we forget, another round of keyword bidding on Google.
Whatever happens during the remainder of 2009 travel firms will do well to take time out at regular points to reflect on what they could have done better and what they should be doing going forward, especially when it comes to marketing.
The number of executives admitting privately they would have done things differently is indicative of the turbulent year many have had. We do not doubt anyone’s abilities, but we are concerned that some companies cannot afford to ride into 2010 with a laissez-faire attitude when reacting to an ever-changing marketplace.