Tui plans to expand its operations by almost 50% to carry up to 30 million passengers a year in the next few years, with chief executive Fritz Joussen pledging the growth will “primarily be organic”.
Joussen outlined four “strategic areas of action” in an address to shareholders last week, spelling out his plans in Tui’s major source markets, hotels and cruises, destination experiences and emerging markets.
The group currently carries 21 million customers a year and Joussen reported last week: “Our business is booming following the insolvency of Thomas Cook.”
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Tui plans a technology transformation across its traditional markets, including the UK, as it harmonises systems and processes in a ‘Market and Domain Transformation’ programme due to be implemented by mid-2021.
This should enable the group “to tailor offerings to each individual” customer, adapting the same technology to every market.
Second, the group aims “to significantly expand the number of hotels” in its portfolio by opening to third-party hoteliers, for example through the Tui Blue brand which will set quality and service standards for third-party operators.
Third, the group aims to establish a global distribution network (GDN) for hotels, or what it calls an ‘Amadeus for hotels’, beginning with a focus on China, India, Brazil, Malaysia, but also on Spain and Portugal.
Joussen said: “Originally our goal was to generate one million additional customers per year [in these markets] from 2022. We are now seeking to achieve that goal sooner.”
Tui is also working on a ‘new generation’ property management system (PMS) for hotels “allowing differentiated marketing at the level of one single bed night” as opposed to “conventional systems still based on room categories”.
The new system will offer customers ‘select your room’ options such as for “a sea view, morning-sun room within range of a baby monitor”.
The fourth area of expansion will be in destination experiences which Joussen described as “the gem in our portfolio in terms of growth”.
Tui sold 10 million excursions and activities last year and Joussen said: “With 10,000 employees in 50 countries we benefit from a significant advantage . . . [with a second] enormous advantage that we know four-to-six months ahead when our customers are going to travel where.”
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