Flight Centre shrugs off Airbnb threat and claims disruptive start-ups are over exposed
Flight Centre marketer Keith Stanley has dismissed the threat of start-ups like Airbnb, insisting they are minnows in the industry who do not deserve the exposure they receive.
Stanley said operations such as taxi firm Uber and home stay accommodation site Airbnb are handed too much publicity and will “always be a small part of the industry”.
The comments came during a question time panel at the Mumbrella Travel Marketing Summit, which saw Accor vice president of marketing and communications Bridie Commerford praise the “disruptors” for keeping traditional players on their toes.
“We don’t see Airbnb as a combative issue but one of the things that is really important in any category is disruption – it makes everybody sharper, it makes consumers more interested, it makes it more fresh and dynamic,” Commerford said. “We see Airbnb as another disruptor, similar to Uber.”
Stanley responded by suggesting start-ups like Uber and Airbnb are spoken about “as if they are going to take over the world”.
“They are always going to be a small part of the industry,” he said. “Yes they are disruptive and it keeps us sharp and keeps us aware but to think that 90 per cent of people are going to stay at someone else’s house is just ludicrous.
“I think they almost get too much air play for the contribution they make to the industry.”
But Commerford said Airbnb is possibly broadening the travel market by targeting younger travellers who will, in later life, choose to stay in hotels rather than someone’s house.
“They are enabling more people to travel which means good things for us in the future,” she said. “It’s not a big [competitive] concern for us at this point in time, and we have our own strategy to appeal to the youth with our Ibis properties.”
Later, Stanley and Helloworld chief marketer Kim Portrate robustly defended the bricks and mortar travel retail model, arguing the plethora of choice available to consumers was playing into their hands.
Stanley said the demise of the physical agency had been greatly over exaggerated, while the supposed dominance of online travel agents (OTA) had also failed to materialise.
“I remember 20 years ago when the Internet was really the big thing someone asked Skroo [Flight Centre managing director Graham Turner] is this the end of travel agents,” he said.
“We have grown every single year since then and I am still looking for the profits from the other guys. I am not undermining the OTAs but, a little bit like Uber and the others, they are not the major part of the distribution channel.”
She also reiterated that TA would turn its marketing focus on the nation’s aquatic and coastal areas.
“In the past we have had a competitive advantage in that area and while we are still on par, others have focused on it. We want to get our mojo back,” she said.
Business and consumer events and luxury will also be a feature of TA’s marketing efforts while marketing the experiences available in Australia to an increasingly independent Chinese traveller will also be stepped up.
Constantine Frantzekos, founder and chief executive of creative and digital agency Penso, advised companies to focus their marketing and media spend on reach and not rely on customer retention or loyalty.
“All brands churn and lose customers so move towards reach and acquisition. We advocate that very strongly and thankfully we are seeing an over-investment in loyalty and an over-investment in owned social media channels,” he said.
“It’s very easy for us as marketers to assume that people are thinking about our brands all day, every day, but we always like to operate under the assumption that people don’t care, or share and they don’t know or they have forgotten or are not interested.”
The focus should be on becoming “as distinctive and memorable as possible”, Frantzekos added, a strategy particularly relevant in travel where brands need to inspire.
“If brands are not visible or noticed or inspiring people to travel then we have failed in our jobs,” he said.
Steve Jones
topics
Accor
Advertising
Airbnb
disruption
Flight Centre
Helloworld
hotels
keith Stanley
kim portrate
Marketing
Penso
travel
travel agents
Travel Marketing Summit
Uber
I’m in my 20s reading this and wondering what this guy is smoking. These startups are going to change the world and completely disrupt the traditional models of every industry here just like they have done in the US and elsewhere. The fact that these potential rolemodels in Aus think this way in media, travel and transportation is mindblowing in the worst possible way.
As soon as a travel startup with no bricks and mortar has the global leverage it needs to be competitive in Australia, Flight Centre is finished. If people like Keith Stanley didn’t dismiss the future, they could make the right moves to prevent their destruction.
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Smacks of denial.
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Like Microsoft dismissing the iPhone or Blockbuster opting not to buy Netflix – these guys are on their way to a total disaster.
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The two key points Mr Stanley has made during the Travel Marketing Summit are both dangerously narrow minded and off the mark.
1) Relevance is important, creative is not
2) Start Ups are cute but irrelevant.
There is a fairly significant disconnect between perception and reality here, and I would hazard a guess and say 90% of us can see it.
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Having used both Flight Centre and Airbnb recently…I truly would never go back to Flight centre. Was the worst customer experience I’d ever had – too many of my flights were completely botched, blatantly wrong dates by some pretty incompetent staff.
Airbnb on the other hand. Beautiful apartments throughout Europe at 1/4 of the price and better service from the apartment owners than any hotel id been to.
Goodbye Flight Centre. Never nice knowing you.
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That’s cute.
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When my grandmother was gravely ill not too long ago, I visited a Flight Centre shop to book the earliest flight out of town, rather than looking to OTA. This goes to show that brick and mortar store is still important.
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When my father died I jumped online and booked all the flights I needed without any hassles at all and could receive immediate confirmation without an middle person.
I haven’t used Air BNB yet but intend to on my next trip overseas, the idea of staying with locals and learning about the area through them sounds very appealing almost like my own private tour guides.
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Never dismiss Bricks and Mortar – They will continue to play an important role in travel. Often It’s a lot easier to deal with a good agency when your travel plans aren’t going to plan. It’s a matter of personal choice. OTAs for accommodation, and travel agencies for flights, that’s how I book.
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I suspect Flight Centre know they have another 5 or so good years left.
The Flight Centre target market – in this case I suspect mainly cashed up baby boomers seem unable or unwilling to plan their own holiday and simply visit their local travel agent.
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Yes Travel agents are invaluable with more complicated planning where several cities and/or countries are involved but simple A to B is pretty straight forward unless one is not savvy on the digital front and there is an age group that would find this challenging.
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Family Traveller- that’s how people who remember more time before the Internet book and nobody else, flight centre has 10 years max before being bought or being bankrupt
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ZM and family traveller are right, don’t write off bricks and mortar.
and plus, what is the guy meant to say, “yep our business model is f*cked because everyone lives on startup hype and gets all of their information from buzzfeed articles these days?”
play to your strengths, pick your markets. i reckon the people at flight centre understand this.
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