Thomas Cook is copying TUI’s strategy, claims Steve Endacott, chief executive of On Holiday Group, but it doesn’t have the online presence to back it up.
In a recent blog, Endacott says the strategy may be ‘right’ but that TUI has a multibrand online presence with Late Rooms, Hotel Opia and Thomson Holidays.
He says Thomas Cook seems to be wanting to boost its online sales to 40-50% solely through the Thomas Cook brand.
Endacott says: “Although there is a great deal of logic in focusing on the strongest brand you have, it’s hard to see how Thomas Cook can effectively support its relatively expensive “undifferentiated” tour operating product whilst at the same time exploiting the low-priced dynamic packaging sector.
“The single biggest problem faced by Thomas Cook management is that it over invested in the high street stores and its recent £90m deal to secure 400 Cooperative Travel shops really looks like a stinker.
“Differentiated product sold via traditional high street shops, complemented by the internet sales of commodity stock where the lowest price producer wins, has to make sense.
“If it can decide how to best focus this brand whilst introducing secondary online brands to segment the market, then it can still be on to a clear winner.”
Click here for Endacott’s blog
