On the Beach waits for ad drive payoff
6 February 2020, 08:24
The travel firm has made a massive push to win market share following the collapse of Thomas Cook,
Investors in travel firm On the Beach will have to wait until the second half of the financial year before seeing the full payoff from its massive push to win market share from Thomas Cook.
The online booking company, which specialises in beach destinations, said its rival’s collapse had given it an “unprecedented opportunity” to take a bigger piece of the market.
Bosses more than doubled the amount they spend on offline marketing, but expect that part of the hoped-for payoff will not come until later this year.
Chief executive Simon Cooper said: “The actions we have taken in the first four months of the new financial year have accelerated our market share gain and mean we are well prepared to take advantage of capacity returning into the market.
“Our incremental investment into offline marketing activity is helping to drive significant growth in awareness of the brand nationally.”
On the Beach leapt at the chance that it had when Thomas Cook collapsed. The 178-year-old business flew its last passengers last year, partly after it failed to keep up with the sector’s move online.
But the failure has also pushed up prices across the industry as passengers compete for fewer available seats.
Mr Cooper and his team do not expect prices to return to normal until the next financial year at the earliest, they said.
Nor are rising prices helped by the grounding of Boeing’s 737 Max aeroplanes.
Airlines across the world were forced to temporarily retire their versions of the plane last year after the model was involved in two crashes.
Boeing is still cautioning that it will take time to get the planes off the tarmac and back up into the air. Earlier this week Ryanair said it was delaying it aim to carry 200 million people every year because of the delays in delivering its new 737 Max planes.
It does not expect them to be delivered until September or October, the budget carrier said.