As another failure hits the press, consumers are looking for certainty. There’s more to delivering it that than scale, says Danny Rogers
While on holiday in Mallorca last week I was checking my iPhone – on an outrageous minimum roaming tariff of £4.25 per day – and was even more shocked to see that another travel brand, Kiss Flights, had gone the way of Monty Python’s parrot.
After all it’s rare for operators to ‘run down the curtain and join the choir invisible’ during the busy month of August. And viewed in the context of the recent demise of Goldtrail and Sun4U, one got a reminder of the febrile nature of the travel industry at present.
However, from a marketing perspective, such developments should actually play into the hands of the bigger brands.
The media coverage of Kiss’s travails seemed suitably overheated during what is the silly season for news, with two former directors of the ill-fated XL operator ‘outed’ by the tabloids as also allegedly ‘behind’ the Kiss operation. Consumers were certainly given the impression of an industry where any ‘cowboy’ can run a ‘dodgy’ flight operator.
The likely effect of this is to drive sales through established brands such as Thomson and Thomas Cook, which suddenly appear a much safer bet to consumers, owing to their longevity and size. Certainly, while the Atol bonding system remains confusing to many, the instinct will be for travellers to opt for big players with apparently deep pockets.
To some extent this is what recessions do. One can view it either as natural sorting of the wheat from the chaff, or as survival of the biggest and strongest, but the effect is much the same. Viewed more kindly, it is the very essence of strong brands; their value ultimately resides in trust built up over a period of time.
Did the ‘Big Two’ see this coming when they consolidated from the ‘Big Four’ a few years ago? They certainly started to cut out duplicate costs, slash airline capacity and reduce the number of brands that they needed to market, all of which improved their margins.
But they received an a welcome boost when XL went bust in September 2008, taking another big slug of capacity out of the UK holiday market.
Recent events will help them further as capacity continues to dwindle and trust in lesser-known brands falters. Indeed anyone who has booked a flight through the leading players in recent weeks will attest to higher fares than a year or two ago – and very full aircraft.
The fact that they continue to issue profit warnings is a sign of a tough overall market, but the two UK travel giants look pretty robust to me.
What TUI and Thomas Cook must do is continue to invest in their brands throughout the remainder of this downturn. While recessions naturally create a ‘flight to quality’ among consumers, they are also a great opportunity for the enlightened brands to put clear blue sky between themselves and would-be challengers.
This means marketing proactively and creatively, communicating openly and, moreover, striving to improve the customer experience.
Although consumers may have little choice in the short term, equally they have long memories. So marketers must remember that trust isn’t a given for large companies. It is something that they earn over many years, if not decades.