Travel Flows

Forecasts are never easy, but getting future travel preferences right is especially difficult. Tourist flows have often switched direction after a natural phenomenon or geopolitical event, and then new arrangements must be put in place quickly. At times like these, it pays off that TUI has very experienced, hotel purchasers. A glimpse behind the scenes.

Name

Marina Comas

Position

Purchasing Director West Med

Responsible for

hotel purchasing in Spain (incl. Balearics and Canaries), Portugal and Cape Verde

Staccato! Marina Comas’ fingers fly across the laptop keyboard in her sun-drenched office in Málaga. The Purchasing Director West Mediterranean types, thinks and speaks fast. When she starts talking about her role, Spanish temperament fuses with a clear, analytical view of the hotel trade. A very compelling blend at the negotiating table. Her speed is hardly surprising. During the last financial year, a gentle trend became a big shift in tourism flows from the Eastern to the Western Mediterranean. Recent geopolitical events caused holidaymakers to adjust their travel preferences, and the pattern of previous years was reversed as they set their sights on Spain and Portugal rather than Turkey or destinations in North Africa. By the time it happened, hotel commitments for the peak summer season had long since been signed off. So apart from preparing for the year after, Marina and her team needed to source additional capacity quickly and offer TUI customers additional choices.

“We wanted to be the first”

A race against time because, obviously, it was not only the purchasers at TUI who saw this trend coming. So did experts working for the competition. “We wanted to be the first,” says Marina Comas, pinpointing her ambitious approach. “The key to success in this financial year was no doubt our fast response and also our many years of good relations with hotels.” There are about 34 people in her team, spread around the Spanish mainland, the Balearic Islands, the Canaries, Portugal and Cape Verde, where they foster contacts with local business partners. Apart from healthy personal relationships, TUI’s strong brand image in these different countries opens the door to renegotiating deals. But even when circumstances are favourable, discussing contracts mid-year is always a challenge, especially if – as in the period in question – approximately 500 additional hotels are added to the portfolio. A feat of strength transformed by TUI’s international employees into a genuine success story. Ultimately, their achievements played an important part in finding alternative destinations for around 2 million TUI customers.

Different countries, different tastes

Apart from identifying this additional capacity, the hotel purchasers naturally have their regular schedule for handling seasonal business. Contracts for the following year are signed between March and August. Marina Comas takes her cue from the briefings she receives from all the Source Markets and from analysing current hotel trends and customer interests. The mother of two is frequently on the move during this period, demonstrating her talent for time management not only in her professional appointments, but in her domestic life too. A relaxed weekend with the family will be followed by a business trip to Cape Verde for general talks with Riu or a visit to France to evaluate the past season and explore growth opportunities with her French colleagues. At this stage, every Source Market will express different needs and put in an individual request for volume. The United Kingdom, for example, tends to opt for all-inclusive facilities, whereas holidaymakers from Germany like half board and Nordic travellers are keen to cater for themselves.

TUI has contracts with altogether 2,200 hotels in the region Spain, Portugal and Cape Verde. They include not only the company’s own brands, like Riu, Robinson and Magic Life, but also hotels with other owners or well-known chains like Meliá and Barceló. Marina Comas has been with TUI for 15 years, and over time she has got to know many of them well, so during her site inspections she can focus on finer details which appeal to the market. Does this all-inclusive hotel include a 24-hour snack bar? Does this family hotel offer a splash pool with water play for children? What extra revenue can be generated by swim up rooms with their own direct access to the pool? And quite possibly the hotel needs a spot of decorating. If so, that will end up on her list as well and be a topic for negotiation.

TUI hotel brands are a sales guarantee

With a glance at her figures, Marina Comas confirms that TUI has adopted the right strategy with its hotel brands: “Whenever we open a hotel under one of the four core TUI brands or one of our three hotel concepts, the booking stats look good.” Given the large number of established hotel brands, expansion in Spain is not always easy. All the same, it is proceeding slowly but surely. Marina and her team provide whatever help they can as hotel scouts. “My team have the best contacts with hotel owners. If anyone is thinking about changing a format, we can soon tell if the hotel matches our own brand criteria and standards, and we can pass that message on.” The fast response reaps rewards, not only in Spain.

2,200 hotels in the region Spain, Portugal and Cape Verde operate for TUI under contract. The core brand Riu, with its deep-rooted traditions, provides just 36 of those.

Marina Comas travels widely as Purchasing Director for the Western Mediterranean. But her home base is in Málaga, where her team share offices with Destination Service.

Meetings in Málaga are usually small-scale affairs. Marina has around 30 people on her team, based in different places on the Spanish mainland, the Balearics, the Canaries, Portugal and the Cape Verde islands.

When travel flows switched direction, Marina and her team had to find about 500 extra hotels for the Summer 2016 portfolio.

Twice a year, Marina Comas conducts general contract negotiations with Riu for an upcoming Summer or Winter season. Usually these are held in Cape Verde, where the distribution partners have offices.

But the partners also meet up more frequently to swap news, like Marina Comas is doing here by the Riu Nautilus pool with Jenny Dorai Jaume, Sales Manager at Riu.

A good location and excellent service make all the difference when selecting a holiday hotel.

Whenever a hotel is to be built or refurbished, Marina pays close attention to all the little details that boost sales: such as swim-up rooms or a 24-hour snack bar for the all-inclusive format.

Constructive, long-standing relations with hotel owners are key to the purchasing team’s success.

In the Málaga region, two Riu hotels have been merged for the coming Summer to create one big family-friendly resort. Marina Comas is given an exclusive preview of the construction plans.

Discerning touch: when Marina Comas inspects hotels, she needs to be satisfied with the bed quality for future TUI customers.

Partners working with the TUI brands Sensimar, Sensatori and Family Life implement clearly defined hotel formats drawn up by TUI – and they are doing a grand job, as the purchasing team can tell from a glance at the booking statistics.

“We had a very good season,” General Manager J. Miguel Bordera Francés is extremely satisfied with his hotel’s début as the TUI Sensimar Riviera.

5 questions for

Name

Garry Wilson

Position

Managing Director Product & Purchasing

Responsible for

purchasing worldwide and relations with TUI Group’s international partners

»Our team have done a great job in
renegotiating contracts this year.
The key to this success is
our relationship with our suppliers.«

Garry, what are the main activities of Group Product and Purchasing?

Garry Wilson: TUI Group Product and Purchasing was created from the previous source market purchasing teams to leverage the TUI Group scale and expertise for all markets. Our focus is the development of group destination strategies, identifying synergies and opportunities for growth. We contract hotels for fourteen markets – namely, for TUI Central Europe, Northern Europe and Western Europe – and have developed differentiated hotel concepts that appeal internationally. Capacities are planned by each market but our team then take a group view when negotiating with the suppliers. The purchasing team work closely with the Source Market product teams in order to understand their needs and deliver accordingly. The team are based globally, in destinations and Source Market offices. TUI employees are considered within the industry as experts in their fields and we are continually focused on recruiting the best talent to the business.

Turkey, Egypt and Tunisia were hit hard last year. How flexible do you have to be in hotel purchasing in order to be able to respond to changes at short notice?

Our team have embraced the challenges very well indeed. They have done a great job in renegotiating contracts by acting quickly to reduce exposure on guarantees and prepayments, allowing us to take out capacity from some destinations and move it to the ones in demand. This has really brought home the value that Product and Purchasing bring to the organisation and it has highlighted the importance of the flexibility in our contracts. However, the key to this success is our relationship with our suppliers. Some of these relationships go back more than fifty years and as partners we have complete loyalty to each other in good and bad times.

What destinations have benefited from the changes in FY 15/16 and what have you done in hotel purchasing in order to respond to the changes in tourism flows?

Spain, Portugal, Italy, Croatia and some Long Haul destinations have all benefited from these changes as the capacities have been shifted from the affected areas. Our team in these areas have had an enormous challenge in increasing our allocations in the existing portfolio and sourcing new product as well as protecting the existing beds along with the support of our hotel partners.

How do you assess the trend towards private accommodation (Airbnb, etc.)?

Differentiated product, service and accommodation quality are our key competitive advantages over the private accommodation market. Whilst private accommodation has grown rapidly in the commodity city travel markets, the security and service that come with organised travel continue to be important for the main family holiday.

What trends are you expecting for the next few years?

We will continue to do what we do best – creating innovative differentiated products on an international scale. Growth of our core hotel brands and concepts across the globe and new developments, such as multicentres, tours etc, should be our key focus.

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