Monthly Report BVI Tourist Board
Advertising Trends Holiday industry’s blues What a difference a summer makes. In May, tour operators were arguing that their industry was “recession proof”, with consumers unwilling to cut back on their weeks in the sun, even if it made for belt-tightening elsewhere. Now, with up to 80,000 XL Group and K&S Holiday customers stranded in destinations across the globe, the recent high-profile failure of budget carrier Zoom and with Italian carrier Alitalia on the brink of bankruptcy, things no longer look quite so sunny. Already this year, several airlines, including Zoom, Futura and business carrier SilverJet, have gone out of business. More grim news followed when budget carrier Ryanair reported an 85% fall in first-quarter profit, and British Airways and easyJet both announced management cuts. Seguro Travel is also shutting up shop, while the demise of XL, the UK’s third-biggest travel company, is – at an estimated £60m to the Civil Aviation Authority – the biggest in 20 years. The nervousness is spreading across the spectrum. Thomas Cook and TUI Group – both of which posted bullish results in May – look likely to ride out the storm, but at some cost. “The big daddies of the industry, such as TUI and Thomas Cook, will consolidate their market positions and be resilient, and smaller brands will face more doom,” predicts Caroline Bremner, Euromonitor global travel and tourism manager. When Thomas Cook, the second-largest travel agent in Europe, reported in May that its losses had reduced from €267.7m (£212m) last year to €193.6m (£153.5m) with especially strong trading in the UK, it claimed that people were “unwilling” to cut back on family holidays.
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