Coronavirus: Government decision on refunds expected next week

Coronavirus: Government decision on refunds expected next week

A UK government decision on whether to suspend the consumer refund rules of the Package Travel Regulations is not expected until next week.

The decision by the Department for Business (BEIS) remains in the balance following a meeting of Abta, the CAA and officials of BEIS and the Department for Transport (DfT) on Thursday.

Travel Weekly understands this is likely to have marked the final discussion on the issue.

ABTA has warned the government of “mass failures” and “an industry-wide collapse” if the PTR requirement to refund consumers for cancelled bookings within 14 days is adhered to.

A decision is urgent, not least because Tuesday, March 31 will mark 14 days since the UK Foreign Office advised against all overseas travel – triggering immediate cancellation of more than two million protected bookings.

The total value of refunds owed has not been made public, but Travel Weekly has been told “it’s a colossal number” which threatens wholesale insolvencies.

The government is aware this would deprive most consumers of early refunds and leave the DfT to pick up the bill as the CAA and Air Travel Trust (ATT) which underwrites Atol consumer financial protection is still dealing with the failure of Thomas Cook last September.

The Cook collapse cost the ATT £481 million and the government an additional £156 million, the UK’s National Audit Office revealed last week, with the final bill still to be assessed.

Abta wants a suspension of the legal requirement to refund consumers in full within 14 days of cancellation, requiring a temporary change to the PTRs.

The association and the CAA have been urging the DfT and BEIS to act for a fortnight.

Abta has partially taken the matter into its own hands, advising members to delay refunds and issue ‘refund credit notes’ on ATOL-protected bookings, initially up to July 31.

It wants BEIS, which oversees the PTRs, to make this legal and the DfT – which oversees the ATOL scheme – to confirm protection for the delayed refunds should travel businesses go bust.

Travel Weekly understands government ministers and officials are concerned delaying refunds “is not good news for consumers”.

An industry source said: “They get this [proposed refund credit note] regime will deliver refunds more quickly to people but are worried about how to explain it to consumers.”

Concern that the EU may react to a breach of European rules is also troubling officials despite Britain leaving the EU. All EU regulation remains in force until at least the end of the year.

The source suggested: “The very fact Abta is still in detailed discussions with the government on this is positive.

“Officials understand this is not the industry bleating or crying wolf, but it is a difficult decision for them. Abta is trying to pull off a balancing act.”

The source suggested: “The DfT knows Abta is not over-egging it. They saw how much flak the government took over Thomas Cook.”

The problem is also set to grow worse. The initial Foreign Office advice against all non-essential travel was for 30 days. More bookings will be cancelled as the advice period is extended, adding to the sums to be refunded.

The source said: “The pressure is going to build as time goes on. It’s a rolling problem.”

Abta has said it will stand behind the refund credit notes as a guarantor up to July 31. But for the delayed refunds to work, the DfT [through the CAA] needs to stand behind refund credit notes issued for Atol bookings.

The source noted: “It will only work if Abta and the CAA underwrite it. The CAA is in an invidious position, but it’s not in its interests to have the industry destabilised.”

If BEIS does not modify the PTRs, Abta would “have no choice” but to proceed in advising members to delay cash refunds and provide refund credit notes in their place.

Abta has also asked the government to insist airlines return to refunding customers or their agents for cancelled flights as part of any aid provided to carriers.

It said: “Government-funded assistance should be directed as a priority to the payment of refunds to trade intermediaries and the consumer.”

The CAA is responsible for enforcing the rules on airline refunds under EU Regulation 261 on air passenger rights.

The source said: “The CAA is trying to get action by the airlines by consensus first. The CAA and DfT are working with the same airlines to try to get people home and that is the priority.”

Google remarketing and metasearch are Travolution board’s hot tips for 2014

By Travolution

Google’s new Remarketing Lists for Search Ads is already starting to have an impact on marketing budgets, according to a leading agency working in travel.

Speaking at last week’s Travolution editorial advisory board meeting, Nishma Robb, iProspect chief client officer, predicted this will be one of the key trends for 2014.

She said the agency is already seeing clients increase budgets for next year but are looking at how search is interwoven with display.

Robb said the remarketing capability currently being rolled out by Google was already seeing firms focus on optimisation.

“It’s encouraging businesses to get smarter about analytics and conversion. We will now be able to prove [the effectiveness of campaigns] through technology.”

This is what Google says about Remarketing Lists for Search Ads:

“[It] provides yet another opportunity to optimise your search campaigns by letting you tailor your keyword bids and ad text for your highest value prospects - people who have visited your website in the past - when they’re searching for what you sell.”

Google estimates that conversions online run at between 2% to 4% of visits, and in travel where customers visit in excess of 20 sites before committing that figure is usually a lot lower.

A Google Think Insights post said: “In standard search campaigns, your bids, ads and keywords are the same for every search and every searcher.

“But if you knew which searchers represented higher value prospects, you might want to bid higher, show on broader keywords or present different ads to these customers to improve your results.

“Remarketing lists for search ads lets you do just that. You can use your existing remarketing lists to more effectively reach past site visitors so you can get more conversions and potentially better ROI.”

Robin Frewer, Google director of travel and finance, said the functionality will enable travel advertisers to target certain customers according to particular insight into aspects of product they have shown an interest in.

He said Customer Parameters will be “really powerful for remarketing to customers with a specific interest in specific destinations, dates or product types” and will help travel firms increase the accuracy and therefore the profitability of their advertising.

Frewer predicted that there will be a shift to measurable, performance-based marketing activity and that this has already seen more focus on brand building online, which is becoming increasingly more accountable.

Another area the board picked out to dominate in 2014 was metasearch, with this sector expected to make big in-roads into the traditional beach market.

Kayak and, increasingly Tripadvisor, are expected to have a major impact in this area the former having already launched package price comparison and started offering its own packages under a deal with On Holiday Group.

Former Traveltainment UK managing director, Andrew Nicholson, said: “There is still a lot of brand equity in the meta play.

“Players in meta dominate flights, are very aggressive in hotels and beach will be the big market they tackle next. Definitely volumes are going through the roof.”

Ian Brooks, Puregenie managing director, said he could see travel metasearch sites coming to dominate as they do in other sectors like financial services.

Tui Travel to push for widening of package law scope

By Ian Taylor 

Tui Travel will lobby in Europe to have the proposed Package Travel Directive tightened and airline sales of holidays redefined as ‘customised packages’ rather than ‘assisted travel arrangements’.

If successful, Tui’s proposals would extend the liabilities of a package organiser to airlines such as easyJet and Ryanair.

Mike Bowers, Tui Travel UK’s general counsel, said: “We will say click-through sales are competing with our core offering and with dynamic packages, so should be treated as full packages.”

He said: “The EC is seeking, as far as it can, to capture all true holiday arrangements in an expanded definition of a package and has made a pretty good fist of it.

“The directive has been drafted with the intention of bringing in airline click-throughs, which fall within the definition of assisted travel arrangements where there is a transfer of booking data, but not personal data.

“We would like to see the same conditions apply to anything a customer thinks of as a holiday.”

Bowers added: “Anyone who cares about regulatory fairness, and fairness for the customer, should welcome the directive. It’s not perfect, but the European Commission has done a pretty decent job.”

He said: “Holidays need to be protected. You frequently have an intermediary who is not the end supplier, a service provided overseas and holidays purchased in advance.

"The market has changed since the 1990s, but for the customer these considerations are still relevant.”

Land tours, Europe strong sellers for Montrose Travel

By Laura Del Rosso

Sales are up for Montrose Travel, one of the country's oldest and largest host agencies. “It's up in double digits so far this year, and that's across the board for us: leisure, corporate and groups,” said Andi Mysza, president of the Southern California-based company.

One segment in particular seeing a boost is land packages and tours to Hawaii, Mexico, the Caribbean and Europe, she said.

“Both cruises and land are up, but we're seeing larger increases in land travel, presumably because of the negative press that Carnival has gotten,” Mysza said. “People are asking for more land packages, and we've increased our marketing efforts there.”

As for Europe, Mysza said that the high airfares to the Continent are becoming standard, and travelers are growing accustomed to paying more than $1,000 for flights.

“Last year, I think Europe suffered because of the high fares, but this year it looks like people are getting used to the 'new normal,' if you will, and they are going to Europe even with the fares as they are.”

Mtravel.com, the hosting division of Montrose Travel, scheduled its annual educational conference for Oct. 3 to 7 in Los Angeles, with specialized training at Montrose's headquarters, followed by a three-night Princess cruise to Ensenada, Mexico.

The host agency, which has about 500 affiliated home-based travel agents, typically draws around 125 attendees to the annual conference, which enables them to meet face to face with preferred suppliers and other independent agents and attend training seminars, she said.

“This is the fifth year of doing the annual conference and the first time we've done it featuring our headquarters. The theme is ‘Homecoming,’ and we want to get our agents to our home to meet all the Montrose Travel staff that they normally do not get the chance to meet at a conference.”

In the last year, Montrose (No. 47 on the Travel Weekly Power List) rolled out a customer relationship management program for its agents.

“We've done extensive training throughout the year on the new platform, which is integrated from a marketing standpoint,” Mysza said. “It's helping everyone's business with the ability to push out marketing to our customers, if they choose to receive it. We'll review it at our conference.”

Thomas Cook rolls out Symphony reservation system

Thomas Cook has announced the successful roll-out of the first phase of its new reservation system, with all its winter 2013-14 charter products now sold on the new web-based platform.

The new system, labelled ‘Symphony’ and which has gone live in less than a year, will replace TOS, and Thomas Cook said it “marks a significant milestone” in its IT modernisation programme

Anite’s @com modern browser-based system is quicker and easier for agents to use, said Thomas Cook, and enables component-based holidays and dynamic packaging, alongside package holidays, to be booked from a single selling platform.

Uli Sperl, product and yield director for Thomas Cook UK & Ireland, said: “A new, modern reservation system will make us more competitive by keeping us ahead of a rapidly-changing marketplace.

“It’s a huge step-change and allows many more complex bookings to be completed easily, such as weddings and groups. 

“Symphony is also great at allowing customers and agents to manage bookings through the holiday life-cycle, accessing a holidaymaker’s booking from whichever channel they contact us, providing industry leading service.”

Symphony is now being used by thousands of users across Thomas Cook, following an education programme of e-learning, classroom training and Anite-led workshops.

The next steps in the roll-out of the system will see all Thomas Cook’s summer charter products, including Neilson and Club 18-30, go on sale in May 2013 for the summer 2014 season.