How sad it was to see another much-loved brand, Thomas Cook, disappear. But not just from a sentimental point of view, or from the hit on the UK economy, but in this case, for the trauma it causes those who have saved for a holiday and are left high and dry.
Thomas Cook founded mass tourism, in its earliest days organising for 150,000 people to visit the Great Exhibition. It innovated in how we travelled, where we travelled to and how we paid for hotels.
The cause of Thomas Cook’s collapse is well documented. The Guardian:
"The immediate answer is that it was unable to secure a £200m lifeline from its bankers, including government-owned RBS. But in truth the tour operator’s woes go back much further – a victim of a disastrous merger in 2007, ballooning debts and the internet revolution in holiday booking. Add in Brexit uncertainty, and it was perhaps only a matter of time before the giant of the industry collapsed."
But, the question is this…is it inevitable that long standing brands in evolving sectors are at risk?
Well, not necessarily. We work with a number of travel brands and we think there are learnings to take away which help build and maintain strong travel brands in this world of accelerating disruption and uncertainty:
- Invest in insight and apply foresight. It’s no longer enough to understand what customers need, want and do today. We must use that insight to plan for what they (and competitors) will do tomorrow. Did Thomas Cook apply foresight when making its recent acquisitions? Did they meet new customer needs? Clearly not.
- Stay agile. Be prepared to respond to anticipated changes in an agile way – both in where we invest and ways of working. It has been clear for some time that how people find and buy holidays is changing. The type of holidays they look for is evolving, the number of holidays taken per year is growing. Thomas Cook did not retain the financial agility to respond. Competitors, by contrast, have invested in cruises, river cruises, city breaks and new destinations that get a greater share of our average 2.8 holidays taken per year.
- Own a great experience. Holidays matter. They are what we post on social media and put in the family album. They allow us to connect with family and friends in a very special way. They recharge the batteries. They create memories. Anything that goes wrong with the experience tarnishes the memories. The trick is to invest in the experience where it matters most – balancing how we attack pain points, identifying the relevant, memorable highs that only our brand has or can do, and ending on a high. To be fair, Thomas Cook focussed on this in recent years, supported by a committed and engaged staff – evidenced by the recent stories of Thomas Cook flight crew and retail staff volunteering to help stranded customers. However, it did not fully own the experience . . . while competitors were building their hotel portfolio, gaining greater control of the experience offered, making it easier to book and manage admin, and ending holidays on a positive note.
- Balance brand building with short term business building. Thomas Cook had, in recent years, focused on the short term. It switched marketing spend away from TV into digital spend. However, it did not seem to have the same level of sophistication of some competitors in combining digital marketing and dynamic pricing to control supply and demand.
- Don’t be more wedded to a channel than the customer. The customer now overwhelmingly books holidays on line, even if a retail visit plays a role for some during the research process. Was Thomas Cook too tied to a retail estate at the expense of online ease and speed?
Hindsight is a wonderful thing, and of course it is disappointing to see another much-loved brand go, but long-standing brands can and do evolve. We believe focusing on these key principles helps ensure brands not only survive, but thrive.
If you’d like to talk more about how we can help your brand thrive in uncertain times please do get in touch. We’d love to hear from you: amanda.howard@oxfordsm.com