Travelzoo UK ends year in the black

Chris Loughlin, European executive VP for Nasdaq-listed deals publisher Travelzoo, is committed to growing its subscriber base, so long as revenues continue to increase more quickly than the costs.

“We re absolutely committed to growing a massive pan-European business,” he told Travolution. “To do that we need to keep increasing the number of people who are signed up to the newsletter. While revenues are growing faster than costs, we will keep this focus.”

He revealed that the European operations would have broken even during the year if the subscriber acquisition costs were taken out. “And then if you take the expenses out we would have been profitable,” he said. “But we are convinced that investment to reinforce our dominant market position will generate greater profitability in the long term.”

Travelzoo issued its Q4 2009 results earlier this wek, which showed an operating  loss from its European operations of $1,8m compared with a $1.3m deficit in Q4 08. This was driven by a focus on Germany, where subscriber acquisition costs are greater. Overall, Travelzoo picked up 443,000 new subscribers in Q4 in Europe at an average cost of $3.97.

The UK operations ended the year with an operating profit of £100,000 and a subscriber base of 1.6m. Hitwise stats for January showed that Travelzoo’s Top 20 email is the most clicked on email in the travel category. “Other companies who claim to have big email audiences don’t show in the first 20 sites,” Loughlin said.

He also said that in January the top 20 email generated 2.6m clicks, with one edition seeing a click-through rate “north of 45%”.

Loughlin added that sport and entertainment were proving popular in the UK. Recent deals with Chelsea Football Club and The London Symphony Orchestra both sold out  their allocation. “This product range means subscribers are using Travelzoo for days out as well as holidays. We’re seeing more engagement as well – clicks are growing more quickly than subscribers.”

Travelzoo launched its metasearch in the UK in autumn. Loughlin said that one airline partner had seen a  conversion rate of 14% from the site. “We recently added Ryanair as a partner, which is quite a coup,” he said.

“ has only been in the UK for a short time – we’re happy with the product, we’re adding more partners all the time and once its stabilised then we’ll start marketing more aggressively.”

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