TUI must not get clouded by Brexit drama if it wants to woo more holidaymakers

 
Stephan Shakespeare
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FILES - Picture taken 09 March 2006 show
FTSE 100-listed Tui Group reported a five per cent decline in revenue for the third quarter of 2015/2016 (Source: Getty)

As the TUI Group embarks on a Europe-wide advertising campaign aimed at unifying the travel brand, it’s a good time to examine how the company has been faring.

Recently, the group saw its share price rise following a better-than-expected outlook for its full-year earnings.

YouGov tracking data suggests TUI’s brand Thomson has performed admirably in the midst of challenging market conditions.

Read more: Tui announces plans to phase out Thomson brand

Among all respondents, Thomson’s impression score (whether a respondent has a positive or negative impression of a brand) is four points higher than it was at this time last year (from 15 to 19).

This has been mirrored by its reputation score improvement. This metric measures whether a respondent would be proud to work for a company. On this front, Thomson’s score has also risen by four points (9 to 13).

Despite TUI’s recent success, there are challenges ahead, and not just due to the competitive nature of the industry.

There is a nervousness about how Britain’s exit from the European Union will impact travel operators; from consumers wondering about prices, and from airlines concerned about profits.

We found that over six in 10 (61 per cent) expect the price of flights to go up (only two per cent think they will go down). And while just over half (51 per cent) say they are spending (or planning to spend) the same amount on major holiday since the referendum, 15 per cent say they are, (or will) spend less.

Read more: Stephen Hawking thinks Brexit is too complex even for him

Looking specifically at TUI and its business model, seven per cent say they expect to use all-in-one travel providers more, compared to six per cent who say they will use them less, and 31 per cent that expect to use them in the same way.

There is also opportunity for TUI and indeed other providers post-Brexit as 16 per cent say they will look to plan their holidays earlier than usual in 2017 – so capturing holidaymakers’ attention at the opportune moment is key. Therefore, it is more important than ever to appeal to both existing and potential customers in the right way.

A targeted message that will help to assuage the fears of those looking to penny-pinch more than they ordinarily would have done is one potentially strategy for TUI in the months ahead.

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