TravelMole Q&A with youtravel.com sales and marketing director Paul Riches

Q) You have been going for a year now?  Has it been a good one?

A) Yes, we have achieved the majority of the targets that we originally set, having come into a crowded market. Many people did not give us a chance but here we are – we have established ourselves in the top three accommodation only suppliers in our specific field.

We have achieved in excess of £40 million turnover and are currently working with over 80% of our targeted distribution retailers.

Q) So, in all honesty, what do you think the secret of your success has been? Were you well prepared when you launched? Were you already well-connected? Or are you in a situation where you have a unique set of data and prices?

A) A mixture of all those – you have to have the right product at the right price. Lots have that but to take that to market you need to have ability, connections and the knowledge to work with key distributors to create revenue. We have an excellent team in the UK and a good team in Athens. Our CEO John Kent is the founder of youtravel and is extremely well experienced in this field and in this business model – another contributory factor.

Fresh from the Gulf of Aqaba-  l to r Renaldo Scheepers A2B Transfers, Paul Riches YouTravel and Andy Claridge Triton Rooms

Q) You have been going for only one year, but it has been an eventful year, during which there have been a number of rumors regarding profitability and consolidation in this sector. There has also been a lot of press coverage about you acquiring a number of businesses in this field. Will you been looking to acquire other bed banks?

A) I won’t comment on specifically other companies but in terms of profitability in this sector, I have seen that margins are tougher to achieve than three or four years ago because there is more competition. Businesses therefore need to increase turnover, as everyone is working on much smaller margins. We too have heard many rumours concerning our competitors and it appears there is potential for consolidation. It is likely that something will happen.

Rumours in us buying another bed bank are perhaps off the mark. We feel they we can emulate what others do but do it better. Our expansion plans may lie outside of the obvious areas and could include selling cruise and other products within a wider product portfolio.

Q) Do you see yourself as, through expansion, almost becoming like a tour operator, in terms of offering a wider range of products?

A) I’m not saying that this is necessarily what we are going to do, but if we do look to acquire we will be looking at other markets. We do see companies like TUI and the Thomas Cook Group acquiring rapidly and I am sure they will look at all areas of the market – online markets, bed banks etc – and see how they fit.  Youtravel.com cannot ignore the big two as they are large and powerful. We have lots of other projects on our plate right now; they are also our competition but in a slightly different way than the other traditional accommodation only suppliers.

Q) So expansion will be potentially into cruise, but in your own existing bed bank are you likely to concentrate on other destinations or will you remain focussed on mainly Mediterranean resorts?

A) Cruise is a potential expansion but is on the peripheral. We see our expansion in the next two to three years as improving our existing product range. We will look more at 4/5 star hotels and more destinations – i.e. Caribbean, Bulgaria, for example. These are the main areas we will be concentrating on.

Q)  Being new, you have made a big splash. Eighty per cent of target retailers have already signed up. What does the next 12 months hold in terms of marketing and further sales efforts?

A) We are going to carry on supporting the trade as we have been. Over 98% of our business is through the trade. I do not see that changing and we have already seen recognition from agents over 12 months. We have been nominated for many awards and we hope to turn those nominations into awards success. We have been nominated for both the British Travel Awards in November and the Globe Awards in January.

Q) On TravelMole virtually every day we cover stories about user generated content. Social media is expected to drive expansion rapidly over the next four to five years. Will Youtravel be utilising any of these tools?

A) I think you can get to a certain point, reach certain volumes within a trade facing site without doing having to do much more. Our partners in the trade will do the rest with their consumer sites. As we are feeding XML into those consumer facing sites they are being looked at by a multitude of users and the use of user generated content is something we would encourage.  We have our own travel reviews on our site but the functionality is not fully implemented yet but we will be moving on to a situation where a more comprehensive customer review will be on there in the near future.

Q) What about exploring the social networking field, e.g. Facebook?

A) Yes, this is not forming part of our current strategy but in future this will play a part.  We are deciding exactly how to use them – i.e. mentioning keywords, youtravel’s name etc.  We are aware of it and will embrace it as we drive more online business but from the business-to-consumer point of view, we see it as one of a number of areas that we should be looking at to drive customers to our site.

All these things have short life spans. We as a provider of data have to be very, very up-to-date but potentially as consumers we have an explosion of information and are in danger of getting overloaded.

Q) Another major topic is the environment. ABTA introduced the My Footprint campaign. Are you getting into the ‘green’ approved hotels, carbon reduction market?

A) We would be keen on being involved and launching something like that. Our overseas partners are not quite ready yet, but we will be having dialogue with our hoteliers to see what they are doing to get to that situation. We wish to identify hotels that are aware of their environmental impact and are improving it.

Q) Can you exercise some pressure on them, given your size?

A) I think we can. We are pleased that ABTA have launched this campaign and we are hopeful of working closely with organisations such as FTO where the governing bodies can exert pressure. We could go to any one of our 2,500 hotels and a number of them will say OK. Someone like the FTO are good as they can approach them on behalf of a number of suppliers. We are keen to speak work with a body like that and would be supportive of it.

Q) Going forward, how do you view your relationship with your clients both now and in the future?

A) Throughout youtravel’s first year of operation, we have prided ourselves on being straightforward, open and honest with our retail partners and will try to maintain and improve relationships. Whilst technology is playing a major part in all our futures, there is still great value in one-to-one key personal relationships. We are great supporters of the work hard, play hard ethics.

*Location Sharm el Sheikh youtravel.com VIP agents’ trip October 2007,  supported by youtravel.com, City Bond Suretravel, Teletext Holidays and A2B Transfers.

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