Package holidays revival down to exchange rate fluctuations, says Lowcost’s Evans

A so-called revival of package holidays is more to do with exchange rate fluctuations than a lasting customer trend, a leading light in the dynamic packaging sector has claimed.

Paul Evans, chief executive of Lowcost Travel Group, told Tuesday’s eighth annual Barclays Travel Forum the trend was “cyclical”.

Evans said most package operators would have hedged their currency for Summer 2013 programmes at competitive rates last August or September. “That allowed them to pass on in the key January trading window very competitive rates. That made packages extremely relevant this year.”

However, Evans said rivals selling component holidays did not tend to hedge so far our out.

“Online players are fixing every week as they go along so they take the vagaries of the [currency] changes as they happen.”

Evans said the biggest concern he has for retail travel agents are additional fees being levied by budget carriers for them to book their flights.

“Travel agents now have to pay £10 more per person booking with a no frills carrier – that’s a lot.”

In the future Evans said he sees the opportunity in hotel room sales as people become more and more comfortable booking flights direct, and tablets and mobile will become more important.

“Look at booking.com and hotels.com and the relative scale of the hotels market. I believe in the long term people will be much more comfortable booking airlines direct. The hotels market is much more fractured and I believe suits tablet and mobile so we are very much more focused on growing our hotels business.”

Evans said Lowcost’s mobile business was 14% up.

However Oliver Brendon, founder and chief executive of Attraction Tickets Direct, was less sure about the prospects for mobile despite his move to invest in a responsive design website to suit all devices.

He said mobile consumers were far less engaged and conversion rates were low although 23% of traffic was coming from tablet and 10% from mobile.

Brendon said social media was a second area of expansion but, again, this was not fueling growth but the Big Data phenomenon and its of personalisation promised “huge scope for growth”.

“98% of people who come to our site do not book. It’s all about relevance and persuasion.”

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