The Travel Network Group booked passengers are up 3% year-on-year and revenue has increased by 10%, but holiday cancellations have risen from 2% of bookings to between 3.2% and 3.7% in the past couple of weeks.
Chief Commercial Officer Vim Vithaldas said some customers who’d booked summer holidays with low deposits in January and February are cancelling now that final balances are due.
“It’s very easy to book a summer holiday for a family of four in January when the deposit is only £200, but when they are asked to pay the final bill of thousands of pounds, they are thinking twice,” he said.
Speaking during TTNG’s overseas conference in Bucharest, Vim said low deposits are a good way to bring in new business and encourage early bookings, but he said agents should realise that ‘a holiday is not sold until the balance is in’.
“They should stay in touch with the customer after making the booking, so the final balance doesn’t come as a surprise to them,” he added.
While bookings for the last six months have been ‘solid but not spectacular’, Vim told delegates the middle market is being squeezed and the family market is ‘really struggling’. Parents are booking late, mirroring last year’s booking pattern, and trading down to three-star accommodation so they can still afford a two-week holiday, he said.
Lates are now ‘super lates’, added Vim, with bookings at the lower end of the market driven by promotional codes.
Conversely, the older and top-end of the market are performing ‘really well’, while discounting by cruise lines has led to a noticeable increase in new-to-cruise customers. “Some of the pricing I am seeing at the moment, I have not seen in quite a while, for decent ships as well, with decent itineraries,” said Vim.
Touring and river cruising are growing, he said, up 15-20% year on year, though on ‘really small numbers’. “Don’t get left behind on that, it’s got a really affluent customer base, high value bookings and commissions tend to be very good as well,” he added.
Turkey has replaced Portugal as TTNG’s fourth most popular short-haul destination, due to more favourable prices, said Vim, while the US has retained its position as the top long-haul destination.
