40% of Elegant Resorts’ current business is for the remainder of 2020

Lisa Fitzell Managing Director, Elegant Resorts talks product, aspirations & market confidence with Graham McKenzie

Transcript of Interview

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Graham: Well, good morning, ladies and gentlemen, welcome to the travel mode COVID-19 broadcast. I hope it won’t be too long before we can drop the COVID-19 line and it would just be ordinary travel mode interviews. If it gives me the opportunity to speak to people like Lisa from Elegant Resorts, then long be it so. Good morning, Lisa.

Lisa: Good morning, Graham. Thank you for the opportunity.

Graham: No problem at all. Lisa, you’re looking bright and Cheery. I understand you’ve just been a few days away. Is that right?

Lisa: Yes. I’ve been one of the very lucky ones to get to Greece. So, COVID impacts us, so it was lovely and well needed recharge, so ready for whatever is going to be thrown at us over the next few months now.

Graham: Okay, good, good. Well, I won’t be throwing too much of any hardship during this interview I hope. Lisa, Elegant Resorts obviously, very well known in the industry, recently the group acquired If Only as well. How do the two brands work together now?

Lisa: Yeah, so we’ve got obviously, If Only is a complete B2B brand, always has been more or less, and we’re very committed to that. So, you know, the culture of that company is so focused a hundred percent on trade and, you know, that’s absolutely where we want it to sit. Elegant Resorts as you know as always been a bit more of a B to C brand.

I joined the company about two and a half years ago. We had a lot of focus on developing our trade business because it was fairly small. And the strategy at the time was very much direct customer business, and we were happy with the trade business that we got, but it wasn’t a huge amount of development to grow it, but we’d started some development to grow it, you know, we don’t see that changing.

There’s lots of ways that we can work closer with If Only because If Only obviously got a great trade team that are on the road all the time.  Our trade team at Elegant Resorts is quite small, so there’s a lot more collaboration between those two teams. So Jon Hardcastle is our head of agency sales at Elegant Resorts, and he’s talking to Tracy Dorothy almost on a daily basis so that they can work a lot more collaboratively together. And other than that, I mean, you know, Elegant Resorts is set at the very, very top-end of the market. You know, the vision for the company is to be the very, very best at luxury. It’s very much you know, at that five star; high five star plus level.

Graham: This sort of stuff you and I would like.

Lisa: Absolutely, the best of the best of the best. I honestly feel we have the best team in the industry to service that very, very top-end customer who wants all of the bells and whistles and the concierge. And we meet people directly from, you know, the curbside at Gatwick Airport and sweep them through the airport and meet them straight off the plane and sweep them through. And everybody that travels with Elegant Resorts are dealt with like a rock star VIP, you know, so that’s very much the brand positioning. And we’ve done a lot of work on the brand in the last two and a half years of just refining it and looking at it and looking at how we could grow it. A natural way of growth is to bring down the products or to expand the product, but we wanted to keep it at that very high-end, but the expansion has really been into the tailor-made area.

Because predominantly, Elegant Resorts has been known as beach which it absolutely is; that’s about 75% of our business. But trying to 5% of our business has been tailor-made in villas and ski. And we found that the trade didn’t really know about that; they didn’t think of us for that. So, the DMCs that we work with in those countries are the best of the best and they’ll get people into areas of the country that they couldn’t necessarily, or, you know, get into or into buildings. And, you know, the guides are the very best. And so, we’ve done a lot of work on that tailor-made development over the last two and a half years. And then the acquisition of If Only really just compliments it because you’ve got the sort of nice crossover on the trade so we can work a lot closer together. And there are elements of product Elegant Resorts that potentially If Only can have access to, which will elevate the If Only brand upwards. But we want, you know, obviously to still have that sort of affordable luxury for If Only scope on that top end as well.

Graham: Is there a likelihood or the possibility of economies of scale, you know, in terms of contracting, in terms of sharing some resources, you know, perhaps narrowing down the number of overseas partners that you have in order to get some better deals, some better service or whatever it might be?

Lisa: I mean, you know, naturally with any acquisition you look at all of those things, so, you know, we’d be silly to not do. So for sure, they’ll definitely need to be some synergies between the two companies, but they’re very, very different brands. So it’s not that easy to just smash them together and say, and here we go.

Graham: No, I was thinking more behind the scenes if you like. Go ahead.

Lisa: No, that’s okay.

Graham: So, in terms of bookings, let’s just stick with Elegant Resorts really at the moment, is the top-end of the market, was that one of the first to react adversely to Coronavirus and will it be one of the first or the last to come back, do you think be more cautious?

Lisa: I think traditionally that very top-end has been one of the areas of the markets to be the most resilient because people who’ve got lots of money want to travel, so they’ll travel come what may. So, you know, throughout Elegant Resorts’ history, it’s never really been too impacted by all of the various things that we’ve come across because people still want to travel. So I think initially, we thought it would actually bounce back a lot quicker than it has. We found we have really good momentum in July, really good momentum. We were so surprise, we were just like, Oh gosh, this is so much better than we thought.

And we actually, in terms of sales in July, we ended up less bookings, but we actually did slightly more revenue than last year, which is quite phenomenal really. But that was what we were finding is that the value of bookings went up massively because of a number of one off bookings that were private jets or somebody had a private jet and they just wanted that Villa in Barbados, so there was some phenomenal stuff that was coming through that really took up the value hugely. So we were so pleased with that, but then as soon as the FCA change came in for Spain; that was the first sort of huge knock of confidence. Because we, you know, Elegant Resorts does Europe only obviously doesn’t, so we have had, you know, passengers travel with us from July onwards. So besides the bookings that we’re making for the future, we’ve actually had some good travel business for July and August. But unfortunately, that was the start of the real lack of confidence and that’s just got worse.

Graham: What about forward bookings? I mean, 2021, are people booking with confidence yet or not?

Lisa: Absolutely. I mean, you know, understandably, we’re a lot further ahead for next year than we were this time last year, because a lot of the bookings from this year has moved on to next year. So, you know, it would be very worrying if it wasn’t, so yeah, lot’s on the books for 2021. But, we’ve also had lots of late bookings for this year. So traditionally at this time of year, about 30% of our business would be for this year and 70 for next year, where it’s 40% for this year and 60 for next year. But after the recent announcement yesterday with Greece, I think that probably change to be honest. You know, it’s been crazy. I mean, we’ve literally organize people’s holidays three or four times, so we’ve offered, we sent them to New York, oh, can’t go to New York, let’s go to Portugal, oh, can’t go to Portugal, let’s go to Greece, you know, so yeah. And then you have to really take a look at it and think, is it worth it, you know, all of that work potentially for nothing at the end of the day.

Graham: Yeah, that’s a very difficult situation. You’re obviously a woman with a deal of experience in the travel industry. People talk about silver bullets in terms of getting traveled back to somewhere near where it used to be. What’s your opinion of that? Do you think there is a silver bullet or do you think there’s a series of maybe bronze bullets or ordinary bullets that need to be fired in order to get something? I mean, obviously people in the travel industry I’ve had a fairly downbeat view of the UK government’s handling of the quarantine the fact that it came in so late and then the advice has been sporadic and changing and not very clear. And also, when people come into the country how quickly and how efficiently they’ve been to track and trace people that have come back with COVID; what’s your opinion?

Lisa: Yeah, I don’t think there’s just one thing really. I mean, ultimately we need a vaccine, you know, that’s what we need, but we don’t know when that’s coming. So, there needs to be a number of things that we do to get people moving again confidently. We’ve had loads of feedback from the people that have traveled with us in July and August. And the way that the Greeks have handle it, the Italians have handled it, the Spanish have handled it, have been really quite good. And people feel really quite confident on how the resorts they stayed in have operated and the extra hygiene and the social distancing. And it is a new normal but you know, once you’ve sort of got over the worry of the plane journey and everything else, then you can relax and totally switch off and have a lovely holiday and people need holidays. They need holidays for their health, you know, we’ll out if we don’t look after ourselves. So, people aren’t getting the holidays that they’ve been able to in the past.

I just think confidence is at the all-time low because they might book to go to that place, but it might change. And you know, am I really ever going to be able to go. There’s so much worry and there’s so many different steps to go through for each and every country. So, both If Only and Elegant Resorts, we’re spending lots of time training our staff on the protocols. We have a call every other day now on, "Okay, this is what we need to do for Barbados. This is what we need to do for Antigua," so that when people call us, we are experts in it and we can navigate through. I personally feel that the quarantine, I’m not sure how it’s being tracked. I know so many people that haven’t had their documentation checked when they’ve come back into the UK, so, how are we tracking quarantine?

I know on the update from the government yesterday, they said one in five people were called. I don’t know a single person that’s been called, and I’ve had lots and lots of people that I know that have traveled now, so that is a real concern. I’m not sure it’s the safest way of doing it. There’s a lot of talk of the way that Iceland are doing it with testing when they come home and then another five days later. I’m no expert on it, but I feel that that’s a better way of doing it. Completely understand that, you know, some countries are very risky and we have to be really careful about where we send people. So, it can’t be a just open the doors to every single country, but it just has to be a lot more straightforward, and that has to be a lot more understanding of why people just don’t understand why Zantac has been put on the list or Mykonos or Santorini; do you know what I mean?

Graham: I think everybody in the travel industry, including myself obviously, is looking for a better future and more professional approach from the government in terms of travel, is suffering very, very badly obviously. And lots of people are likely to lose their jobs if they haven’t done already. And it’s such a major contributor to the UK economy from inbound tourism as well, so I think everybody’s looking for that. Whether they get that leadership or that guidance is a moot point I think at the moment. That’s the performance to date has been sketchy if I was being complimentary.

Lisa: All over the place and nobody’s got confidence in it, have they?

Graham: No, they haven’t.

Anyway, Lisa, thank you very much for your time. I do appreciate it. I wish you the very, very best of luck. And maybe we can have another chat, and maybe towards the end of the year and see how your forward bookings are going.

Lisa: Hopefully it will be amazing. I don’t know about amazing, but you know, back in the right direction of it needs to be, but yeah, let’s keep everything crossed. So you know, we’ve got to be optimistic and we’ve got to stay positive and we’ve got to focus on what we can actually control, you know, that’s what we can do. Thank you so much for the opportunity.

Graham: Bye.

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