Channel blurring at Tui as online package sales fly

Europe’s largest travel group, Tui Travel, has revealed it no longer breaks down its trading by channel as a more diverse range of its product is sold over the web.

Speaking exclusively to Travolution sister publication Travel Weekly, the firm’s two main bosses, Peter Long, chief executive, and his deputy Johan Lundgren, indicated they are seeing a growing blurring of channels.

Lundgren said: “It used to be that online was viewed as good for simple bookings. That’s not true anymore.

“People are booking higher-price, differentiated products online. In the past there were generally higher sales of seat-only online, but there has been a big increase in package sales.

“We are getting better at showing all the content online and that drives conversion. Our share of seat-only is coming down [anyway].

“We used to break down [the proportion sold online by type booking], but now we don’t.”

Tui’s trading this year has prompted it to increase capacity next year for the first time in five years.

The firm has cut UK mainstream capacity this year by 7% although revenue was up 5% this summer despite it carrying 4% fewer customers.

Average selling prices rose 10% and Long said Tui has had a good start to 2013 trading.

“We’re at a point where we are positioned for growth. We plan, in a measured way, to increase the numbers we take on holiday.

“It is not a question of how we compete [in this market]; it’s a question of how quickly we grow. We are not managing decline. In this market the strong will get stronger.”

Lundgren said that Tui would not follow rival Thomas Cook in bulk-buying seats from easyJet saying it was investing in its own airline including being UK launch partner for the Boeing 787 Dreamliner.

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