In his first interview in his new role, Tui’s new UK boss speaks to Lucy Huxley about a change of heart over Thomas Cook move
Andrew Flintham was just days away from taking up his new role as Thomas Cook UK & Ireland managing director when his former boss at Tui, UK & Ireland managing director Nick Longman, resigned.
The role that ex-Tui commercial director Flintham had been working towards during his almost 14 years at Tui had become available – and he was about to join the arch-rival.
Flintham says he was away skiing when he got the call to reconsider joining Cook and come back to Tui.
“It was like the ultimate
‘A Questions of Scruples’ dilemma,” says Flintham, referring to the popular 80s board game.
“I thought Nick would go at some point but had no idea he was about to leave. Thomas Cook had come along and said ‘we’d love you to do this’, and I’d spent almost six months out of Tui preparing to join Cook.
“Knowing I was going to let somebody down was an awful feeling. But I knew instantly I wanted to go back and run Tui. There was no umming and ahhing about it. In every review I’d ever had at Tui, the managing director role was always identified as where I was headed.
“Cook was really good about it, but it was still uncomfortable having to tell them I was no longer going to join them,” he says.
Priorities
Flintham says having six months out of Tui gave him a unique position when he came back.
“I’d looked at where we [Tui] were strong and less strong when I was planning how to counteract it in my new role [at Cook], and I think it’s been easier to come back with that perspective,” he says.
“We don’t have people issues, we don’t have product issues and we don’t have commercial issues – I think we are one of the sharpest in the industry in terms of what we do.
“But we need to emphasise – not fix – some of the things we do for customers that we don’t talk about enough. Our greatest advantage is how we look after our customers at every point. So you will see us emphasising the things we do already much more and we are working on some new developments for customers as well.”
Distribution
Flintham says he had got used to sales being split about 50:50 between retail and online, but it was only when he took a step back that he realised more than 60% of Tui’s holidays were booked online in the UK.
“We’re an incredibly digital business,” he says, adding that the appointment of Katie McAlister to marketing director, replacing Jeremy Ellis, who’d worked at Tui for 27 years, reflected this shift.
“Jeremy was a brand marketer who understood digital. But Katie is a digital marketer who gets brand. That slight change in emphasis will be important,” Flintham says.
Tui’s retail network currently stands at 600 shops and Flintham says Tui has built flexibility into the estate to allow it to react to changes in demand.
“We don’t go a day where retail is under pressure, but there is a polarisation going on in the high street, where in some places rents are low and in others they are sky-high. So we will continually look at that and in some cases may close two stores and open one, or close one and open two. We are constantly remixing where we are.”
Third parties
When asked about third-party agents, Flintham is very frank.
“We have a business that predominantly doesn’t need third-party support. We have spent years developing a direct business where we have more control.
“But when you look at it regionally and locally, and when you look at certain products, we want, need and value that extra support.”
And he says in those cases, Tui values those agents.
“Nationally, we’re in the 90s, [in percentage terms] of what we sell direct but that varies regionally and locally, and we need a relationship with certain people.
“That may sound a bit mercenary, but it’s about having a mutual partnership where we need it, that works for us and for them. So we work with a number of third-party agents to move our products and our sales forward.”
He says a tie-up with Iglu.com to sell Marella Cruises was one example.
Flintham admits the recent decision to stop third-party suppliers from visiting its shops when they wanted “didn’t go as well as expected”.
“If you have people turning up randomly and taking over, then it’s really quite difficult to manage. So I fully understand that [our store managers] want to have a bit more control over the process, but it needs a compromise so the solution works for both parties.”
He says there would no longer be a set of rules but Tui will encourage more communication to create a better balance.
Destinations
Flintham says Tui will not be following Cook’s lead to move capacity from Spain to the eastern Med, where it could make better margins.
“We’re not in a place where our margin pressure needs to change,” he says. “And besides, we have long-term hotel partners where our business is grounded so you will not see us dramatically change our programme.”
But he says demand to Tunisia has been strong since Tui reintroduced four flights a week from this month, and Tui will add more capacity to the destination, “commensurate to the demand”.
He adds: “Tunisia is incredibly personal to Tui because our organisation lived through what happened [in Sousse in 2015]. So we’ve been very careful to balance how we go back.
“But unsurprisingly there are a lot of people who love the destination and want to return.”
Flintham says Tui’s long-haul programme will continue to grow, with Tui Group buying more hotels and ground agents in farther-flung destinations.
He tips Asia as one destination primed for significant growth, and says to expect more cruise-and-stay packages around the world as ships are deployed farther afield.
Competition
Asked if he is rattled by the rate of growth of Jet2holidays, which has overtaken Thomas Cook in licensed passenger numbers, Flintham says: “I am confident but not arrogant. Jet2 has done a good job on a number of fronts. They are investing in people, aircraft and profit. So do I arrogantly ignore them? No. But do I wake up at 3am worrying about them? No.
“The interesting thing would have been if they had come to Gatwick when Monarch failed. The fact they didn’t shows they are ambitious, but growing in a controlled way.”
Flintham also plays down the threat from ‘more modern’ kids on the block such as Expedia, Booking.com and Airbnb.
“I remember when I left BA to join First Choice almost 14 years ago, someone asked me why I was joining the UK’s third-largest operator when operators were going to be dead within two years. Well, nobody’s killed us yet.”
Referring to regulations issues some of the new players are facing, Flintham adds: “Everyone gets to a point where they start to get really challenged. We’ve got a longevity that allows us to react and move with the times but fundamentally continue doing what we do best.”