1 ) Introduction
1. 1 Value of the study
This study about the vacation industry and Thomas Cook. purposes to reply a figure of inquiries based on and around their selling scheme. Section one will concentrate on Thomas Cook’s current state of affairs. Questions which are to be answered include:
a ) Identify the hierarchy of scheme within Thomas Cook
B ) Estimate the tendencies in the vacation industry over the past five old ages degree Celsius ) Analyse and measure Thomas Cook’s current selling scheme and their value creative activity procedure Section two of this study is aimed at urging
alternate selling schemes for Thomas Cook which could be put in topographic point in order to make their purposes and aims for the following few old ages.
1. 2 Industry Background
1841 – Thomas Cook arranged the first rider train in England. finally taking riders across Europe and to America ( ThomasCook. com ) . 1950 – Vladimir Raitz offered the first across-the-board vacation bundle ( Telegraph. co. uk ) . Late 90’s. UK had four chief concerns in the industry:
1. Thomson – 4m riders
2. Airtours – 2. 9m rider
3. First Choice – 2m riders
4. Thomas Cook – 1. 05m riders
2004/05 – estimated 64. 8 million trips ( Office of National Statistics ) . Internet usage allows clients to straight buy from hotels and flight bearers. leting the disintermediation of travel agents. taking them to cut the figure of bundles. Late 2000s – UK recession led to the diminution of figure of trips and clip spent abroad. 11 % of trips were between one and three darks. This saw an addition in the figure of visits to UK vacation resorts such as Pontins and Butlins. both experienced a dual figure growing in engagements in 2009 ( Hughes. 2010 ) . 2013 – Survey by Barclay. which included over half of the travel industry. suggested that they expect an addition of clients in 2014. with South America being the chief attractive force. perchance because of the FIFA World Cup.
1. 3 Company Background
Thomas Cook was founded in 1841
Started with rider trains between metropoliss in England. finally moved on to trips across Europe and to America. Cook’s boy John Cook had been working with him for old ages. they officially became spouses in 1871. altering its name to ‘Thomas Cook & A ; Son’ . Company was passed down to John Cook’s three boies after his decease. Renamed Thomas Cook & A ; Son Ltd in 1924 after geting limited liability Their deficiency of success led them to sell the concern in 1928. Nationalised in 1948 as portion of the British Transport Commission. After being sold and bought by a figure of investors it changed its name to Thomas Cook Ltd in 1974. 2002 – German company C & A ; N Touristic AG bought the
company and renamed to Thomas Cook AG. 2007 – Thomas Cook AG merged with MyTravel Group plc. renamed itself Thomas Cook Group plc to which it is still called today. Participating in the cordial reception and touristry industry where they now offer everything from flights. bundle vacations. sails and hotel resorts. 2012 – reported a loss of ?590 million. nevertheless pull offing to cut down their debt by over ?100 million ( ThomasCook. com ) Despite of this they are still the 2nd largest travel company in Europe and the UK. behind TUI Travel ( CAA. 2014 ) . doing them a market leader in the industry.
2 ) Methodology
2. 1 Secondary Research
Most research conducted was secondary. I largely used on-line beginnings and text editions to happen information and information about the industry and my chosen company. There were many intelligence articles which addressed issues about the industry and cardinal tendencies. Thomas Cook publishes one-year studies which address multiple issues. They besides publish their fiscal records. On their web site they have pages which give the history of the concern and cardinal day of the months in its life-time.
2. 2 Primary Research
I made a simple study which I handed out to 20 people at Murray Library. Purpose of the study was to happen out where Thomas Cook appeared on a popularity graduated table and so compare it to official informations of the largest travel companies. I listed 10 vacation companies and asked them to rank them from 1 to 10. Consequences showed Thomas Cook as one of the most popular picks. falling below the 4th pick 3 times. Virgin Holidays was in the top 3 every clip except one time. However informations from the Civil Aviation Authority showed Virgin Holidays to be the 10th largest in the industry.
2. 3 Restrictions
There were a figure of restrictions while making my research. In respects to secondary research I found it difficult to happen official informations in relation to the vacation industry as a whole. market portion etc. I besides found it difficult to happen informations on other concern in the industry. Eg I could happen the Virgin Groups information. nevertheless couldn’t find any for Virgin Holidays. In respects to my primary research I believe I didn’t inquire a big adequate pool of people. such as people from different age groups. Besides as my sample size was reasonably little. therefore the consequences were limited.
3 ) Hierarchy of Strategy
The Thomas Cook Groups hierarchy of scheme is reasonably straightforward. with the Thomas Cook Group being the corporate trade name. and so holding a figure of SBUs below. followed by the functional sections for each SBU. The Thomas Cook Group besides has a figure of concerns which they are associated with.
3. 1 Corporate
The corporate degree of the concern is where the values and overall purposes for the concern semen from. They are identified and created at the really top by the executive commission and so sent down to the SBUs and eventually the functional degrees. In this instance the corporate degree is the Thomas Cook Group. The Thomas Cook Group prides themselves on holding a diverse group of people on the executive commission. Coming from a assortment of states and including people from different concern maps allows them to command the concern and put appropriate purposes. values and civilization in relation to the SBU and the concern functional countries from the corporate degree.
Exceeding service from exceeding people
Succeed as one squad – support and trust each other. work as a worldwide squad Deliver for our clients – present the best possible client experience Engage each other – energise and animate each other. conveying new ides Drive for consequences – have the bravery and finding to win Act with unity – maintain the highest ethical criterions
These values are expected to be carried out in mundane operations at all degrees of the Thomas Cook Group. and hence taking to make excellence in everything they do.
In October 2013. the Thomas Cook Group reviled a new logo and slogan which was portion of their transmutation since conveying in Harriet Green as CEO. The ‘globe logo’ and motto ‘Don’t merely book it Thomas Cook it’ was replaced by the ‘sunny heart’ logo and the new slogan of ‘Let’s go’ . The logo will be used by the group and a figure of their SBUs. Harriet Green announced that ‘it isn’t merely a logo. it’s a promise’ . she added that it will demo that ‘everything through our trade names is connected at every degree guaranting a fusion of attention for our clients. through every measure of their journey with Thomas Cook ( Telegraph. 2013 ) .
3. 2 Business
Thomas Cook is the maestro trade name of the group and so hence holds the most weight and importance on the groups trade name image and repute. At a concern degree. Thomas Cook said they wanted to be ‘high tech & A ; high touch’ . stating that 70 % of travelers want a relationship with their vacation supplier that goes beyond merely booking and paying. In order to make so Thomas Cook at a concern degree identified three chief values which they would necessitate to concentrate on: Be Trusted – Trust. consistence and a strong trade name are the cardinal factors of client pick Be Innovative – Continue to better their online offers with prima digital inventions Be Personal – 50 % of travellers fell overwhelmed with the sum of information and pick. 66 % of travels want aid in picking the right vacation for them ( ThomasCook. com )
Thomas Cook introduced the Thomas Cook Business System. where they identified the clients being at the bosom of the concern and so identified ends which are based around the customers’ demands and wants.
At a concern degree. Thomas Cook have ensured that everything they do from now. is wholly based on and around doing certain the clients gets what they need and expect.
3. 3 Functional
Each functional section will hold different purposes and aims ; nevertheless they all need to work in concurrence in order for the concern as a whole to run expeditiously.
a ) Finance
The finance section can be seen to be the most of import section of a concern. because without money and resources. the concern wouldn’t be able to run. New merchandise gross of ?700m by the terminal of 2015. Salvage ?12m on aircraft costs including fuel and land handling. Gross Margin betterment of 1. 5 %
B ) Selling
Increase presence online/social media
Promote the ‘sunny heart’
degree Celsius ) Informational Technologies
Be ‘high-tech. high touch’
vitamin D ) Customer Service
Provide first-class client service
Ensure clients get perfect trip
vitamin E ) Human Resource Management
The function of the Human Resource Management section is to enroll and develop employees. but besides to supervise their advancement. Right people who fit the concern values Train all employees to work at a high criterion
Increase the productiveness amongst their air hose crew
4 ) Trends in the Holiday industry
4. 1 GDP and Inflation
The industry and the UK in general have had a rough drive. with a recession enduring 6 quarters in 2008/09 and so come ining a dual dip recession for 3 quarters in 2011/12. However information shows that the GDP has been increasing. ( Office for National Statistics ) . This shows potency for the industry and the UK in 2014. In add-on to this. the UK’s rising prices rate ( Consumer Prices Index ) fell to 2. 0 % in December 2013. the first clip it has reached the authoritiess set mark of 2. 0 % since November 2009.
4. 2 Industry Tendencies
At the terminal of 2008. TUI Travels projected tendencies in the industry for 2009.
They suggested that people were more likely to book an across-the-board vacation bundle. adding that it allows people to budget in progress. as their nutrient. drinks and amusement are included in the monetary value. The suggested a figure of finishs which they predicted would be the most popular in 2009. a ) Long Haul – Mexico and Florida
B ) Mid Haul – Greece. Turkey. Cyprus and Egypt
degree Celsius ) Short Haul – Spain. Italy. the Algarve and Manderia
A figure of experts spoke to The Metro ( 2011 ) and made anticipations for 2011. The Association of Independent Tour Operators suggested that people would see topographic points that appear ‘off-limits’ . adding that finishs such as North Korea. Libya and Iran have seen an increasing in visitants. Adding that ‘a top finish for the twelvemonth would be Zimbabwe’ . Other experts predicted that people will see the middle-east. but besides states were they ‘can soak up the culture’ . Another cardinal tendency which was predicted for 2011 was that people would go ‘journey junkies’ . Justin Francis said ‘We have seen a 20 per cent year-on-year addition in the figure of travellers asking about railroad journeys’ proposing that flights were non the lone travel method people were interested in. A study by Thomson ( 2012 ) showed that 58 % of Brits travelled with their parents over the past twelvemonth and 38 % of them besides taking their kids along. proposing that 2012 was a twelvemonth of 3rd coevals household vacations. and foretelling that 2013 would follow this form. 4. 3 Internet
The growing of the cyberspace has allowed clients to seek for a vacation in deepness and besides allows them to entree a wider pick and handiness of vacations. Research by Thomson and First Choice showed that an mean vacation shaper will pass 8 hours researching online. with 35 % stating they spend over 24 hours online looking for the perfect trip. The research besides suggested that Social Media was a immense factor in people determinations on vacations. With 30 % stating images from friends are a cardinal influence. and 7 % stating they ask people on societal webs for vacation advice. figures which they predicted would be probably to turn.
5 ) Thomas Cooks Marketing Strategy and Value Creation Process
5. 1 New Logo and Slogan
The new ‘sunny heart’ logo and ‘Let’s go’ motto was introduced in 2013 and was the start of the companies transmutation. The logo is used for the group every bit good as the SBUs. It was placed on all their fleet. booklets. ads and everything to make with the concern. They released Television ads demoing the logo and demoing clients doing bosom forms with their custodies. They believe the new logo shows clients that they are seting them at bosom.
5. 2 Traveling Online
Thomas Cook announced their program to accomplish 50 % of all their engagements to online ; therefore they would develop their on-line presence. They announced they would be shuting 195 shops traveling from 1069 to 874 ( ThomasCook. com ) . They have late introduced a figure of new tools which clients can utilize online. a ) Ask & A ; Answer – an synergistic tool where clients can speak to go experts and acquire information as if they were in a shop or on the phone. B ) Finish Discovery – a on-line tool where clients answer a few inquiries and the tool will urge and give them holiday bundles fiting the replies they gave. Thomas Cook stated that they already have strong digital certificate and hence non get downing from abrasion. claiming to be the first high street travel agent to offer on-line engagement and saying that they had 310m viewing audiences on their web site in 2012 ( ThomasCook. com ) They besides stated that they wanted to make an Omni-channel stating that they want to be wherever the clients want us to be. Stating they will hold a presence on PC/Laptops. Mobile. Stores. Phone. Destination reps every bit good as holding their ain Television channel Thomas Cook Television which is available on Sky and Virgin Media.
They have created a presence in every bit many ways as they can in order to be able to hold an extended range to their mark audience. They have besides started to optimise a nomadic web site. where clients can and see and book vacations. In add-on to this they have developed a tablet application so that they are accessible no affair what type of device a possible client has entree to. Thomas Cook has already established a strong presence on societal media sites. holding 280. 000 likes on Facebook. 59. 000 followings on Twitter. Both these sites allow Thomas Cook to hold a direct relationship to their clients ; it allows them to communicatebinformation every bit good as vacation thoughts and tips on a free platform. In add-on to this. these societal media sites allows them to pass on with clients. as clients can notice on their pages with any inquiries or feedback they may hold.
5. 3 Sponsorships
The usage of sponsorships has had a immense impact on Thomas Cooks public and trade name image. For six old ages they were patrons of Manchester City F. C. giving them a immense audience. as they are one of the biggest squads in the universe. However Manchester City announced the trade would stop in 2009 ( Manchester City F. C. 2009 ) They were besides one of the chief sponsorships of the London Olympics in 2012. which is a immense event. holding about 4. 0 billion viewing audiences ( BBC Sport 2012 )
5. 4 Value Creation
There are a figure of ways in which Thomas Cook creates Value to its clients: Offer clients an integrated. terminal to stop travel experience. reinforced by the strength of the Thomas Cook brands Help do sense of the overpowering pick of travel merchandises available Differentiate from rivals by offering high degree of client service throughout Offer the confidence of a quality controlled merchandise portfolio and fiscal security Thomas Cook has ensured that everything they do now is in the best involvement of the clients. The development of their on-line presence and online tools are all focused on doing the shopping experience better for the client.
Value Creation Process
6 ) Recommended Selling Schemes
6. 1 Swot
Number one or two in their nucleus markets
Strong client base. loved and trusted
Strong fiscal program in topographic point
Debt of ?421m
45 % of flights out-house
Internet – addition presence
Increase client value
Target larger sections
Internet – more competition
Cheaper air hoses
6. 2 Aims for the approaching old ages
Thomas Cook has set itself a figure of ends which they which to accomplish over the following few old ages. these include: New merchandise gross of 700m by terminal of 2015
UK turnaround of 140m by terminal of 2014
Maintain strong trade name image
Continue to supply first-class client service
Become ‘high-tech. high touch’
Be everyplace our clients want us to be
The purposes of Thomas Cook over the following few old ages focus on deriving a net income but besides supplying an first-class degree of client service throughout every degree of contact. There are a figure of selling schemes which Thomas Cook could present which would assist them accomplish these ends.
6. 3 Selling Scheme
“Marketing scheme is a market-oriented attack that establishes a profitable market place for an administration against all forces that determine industry competition” – West et al. 2010
I believe Thomas Cook should present an organisational scheme. intending they aim to accomplish their administration ends while procuring and prolonging a competitory advantage in the market. They should make this in concurrence with a growing directional scheme. where they should increase their concentration in the market. Turning perpendicular should be indispensable ; nevertheless horizontal concentration should besides be considered as it allows them to increase their mark audience and client base. In add-on to this. I believe that Thomas Cook should besides accommodate a differentiated aiming selling scheme. They should aim a figure of sections with different offers and bundles. This is because. all their clients have the same vacation penchant or fiscal budget. so they need to happen what is right to fit a certain clients demands.
6. 4 Online Presence
I believe that in order for Thomas Cook to win over the following few old ages and make the ends they set themselves. the usage of the cyberspace and being online is something I think is indispensable. The cyberspace gives them entree to the clients from a assortment of mediums. Research by TUI Travels showed that an mean UK vacation shaper will pass a lower limit of 8 hours researching their vacation online. with 35 % of those stating they spend over 24 hours in entire on their Personal computer. Laptop or Tablet looking for the perfect trip for them ( TUI Travels. 2012 ) These figure show that Thomas Cook must guarantee that their web site provides the indispensable information clients need. while besides supplying a high quality of serviceability. Although Thomas Cook has already introduced a figure of synergistic tools such as ‘Ask and Answer’ and ‘Destination Discovery’ . I believe there are a few things they can make which would better a customer’s experience on their web site.
Micromarketing should be introduced. where they tailor their merchandises and services to run into the demands of a client. The option to go a member. where it allows a client to hold a personal page should be introduced. Thomas Cook identified one of the cardinal trade name values they wanted to construct on was ‘Be Personal’ . stating that 50 % of travellers fell overwhelmed with the sum of information and pick available to them. in add-on to this 66 % of travels would wish aid in picking the right vacation for them ( ThomasCook. com ) . The usage of a personal page after logging in can guarantee that the clients get a personal feel ; the page can give recommendation based on the customer’s old engagements and hunts. hence restricting the sum offered to them. while supplying suited options. This would increase a customer’s satisfaction degrees. and could potential travel them from zone of desertion up to zone of indifference or fondness. ( Heskett and Sasser et Al. 1997 ) .
6. 5 Social Media
Social media has become a immense influence on people lives in this twenty-four hours and age. Research by TUI Travels ( 2012 ) suggested that 30 % of people are influenced by friend’s images on Facebook and Twitter when make up one’s minding on their following vacation. In add-on to this 7 % of people said they ask people on societal webs for vacation advice. Although Thomas Cook is already set up on Facebook and Twitter. there are chances for them to progress their presence. Although they already have 280. 000 likes on Facebook. there is still a immense audience on the site which they are non connected with. Facebook reported 1. 19 billion monthly active users as of September thirtieth 2013 ( Facebook. Investor Relations ) . Instagram should besides be a societal media site they should increase their presence on. Instagram allows user to post images for their followings to see. Thomas Cook could post images of vacation finish which may act upon people determination to travel at that place and book through Thomas Cook. They should associate all their societal media sites together so that they all integrate with each other. and besides advance them on their Television ads. Youtube page. shops and web site.
Viral selling should be something which they should make in order to increase their consciousness. Viral ads with known famous persons who people look up to would increase their trade name image as people associating the famous person and trade name together. it will besides act upon them to post it on their societal web sites and increase word of oral cavity about the ad and concern. Thomas Cook reported a 15 % addition in booking shortly after they released an advert incorporating ex-footballer Jamie Rednapp. ( Fernandez. 2010 ) 6. 6 Customer Relationship Management – Loyalty Card games
Customer Relationship Management is an effectual portion of a concern as it can guarantee client feel rewarded and hence are influenced and motivated to remain loyal to a company. Thomas Cook doesn’t presently have any CRM programmes in topographic point which would do clients remain wholly loyal to them. The usage of a trueness card where clients can derive points which allow them to acquire a price reduction one time they reach a certain degree is a immense inducement for them to remain loyal to Thomas Cook. Customers see it as a game and experience like they’ve achieved something when they eventually reach the mark they were puting out for. Similar nine card strategies have been proven to be successful. particularly Tesco’s. Tesco reported an addition of 15 % after the debut of their trueness card strategy. Last I believe the usage of a client trueness card will increase a customer’s life-time value. this is due to the fact that a individual client is more likely to pass more with a concern if they feel like they are acquiring something in return.
6. 7 Service as Drama
The Service as Drama theory ( Grove and Fisk. 1992. pp. 455–462 ) suggests that the service industry and drama/theatre both portion similar similarities: Phase – The Holiday Destination
Actors – Employees/Representatives
Audience – Customers
They besides suggest that in all three must work together and run into with each other in order to make a Service Delivery Experience. whether it is positive or negative.
Thomas Cook must guarantee that their vacation bundles and employees are at a degree which meets the customers’ needs in order to make a positive service bringing experience.
7 ) Decision
In decision I believe that Thomas Cook have a strong selling scheme in topographic point which I believe will let them to make the ends they set themselves for the approaching old ages. However I do believe that there are some betterments which they could do which would assist force them farther closer to their end. I believe they could take more advantage of societal media selling in order to aim different sections of possible clients in the market. Besides the add-on of a trueness strategy would reenforce their trade name value of being personal and seting the client at bosom. I besides believe that they need to force and advance the new ‘sunny heart’ logo so people can easy recognize it when they see it. The usage of a known figure in one of their ads once more will besides assist hike their gross revenues and increase their trade name repute. They have set themselves cardinal marks which are accomplishable. and they already seem to be heading in the right way to accomplish them.
8 ) Mentions
Annual Report and Accounts 2013. 2013. [ e-book ] Thomas Cook. hypertext transfer protocol: //annualreport2013. thomascookgroup. co. uk/assets/pdf/016849_TC_AR13. pdf [ Accessed: 11 Jan 2014 ] . BBC News. 2014. UK rising prices rate hits 2 % mark. [ on-line ] Available at: hypertext transfer protocol: //www. bbc. co. uk/news/business-25726621 [ Accessed: 15 Jan 2014 ] . BBC Sport. 2012. London Olympics in Numberss. [ on-line ] Available at: hypertext transfer protocol: //www. bbc. co. uk/sport/0/olympics/19245330 [ Accessed: 02 Jan 2012 ] . Bullock. G. 1998. The UK bundle vacation industry. Management Accounting. Available at: hypertext transfer protocol: //www. highbeam. com/doc/1G1-20509778. hypertext markup language [ Accessed: 10 Jan 2014 ] . Caa. co. United Kingdom. 2014. 50 largest ATOLs for gross revenues to the public | Check an ATOL | ATOL. [ on-line ] Available at: hypertext transfer protocol: //www. caa. co. uk/application. aspx? catid=490 & A ; pagetype=65 & A ; appid=4 & A ; mode=results & A ; top=50 & A ; type=publicsales & A ; pageIndex=1 [ Accessed: 27 Dec 2013 ] . Fernandez. J. 2010. Thomas Cook engagements boosted by Redknapp ad | News | Marketing Week. [ on-line ] Available at: hypertext transfer protocol: //www. marketingweek. co. uk/thomas-cook-bookings-boosted-by-redknapp-ad/3009927. article [ Accessed: 06 Jan 2014 ] . Grove. S. J. and Fisk. R. P. 1992. The service experience as theatre. Progresss in consumer research. 19 ( 1 ) . pp. 455–462. Heskett. J. L. . Sasser. W. E. and Schlesinger. L. A. 1997. The service net income concatenation. New York: Free Press. hypertext transfer protocol: //download. microsoft. com/download/d/b/5/db526c6a-a6f3-4db7-9622-88bebc2c