fvw interview

Thomas Cook Hotels plans more management contracts and in-house cross-selling

Enric Noguer has brought a hotelier's perspective to Thomas Cook Hotels & Reosrts
Thomas Cook
Enric Noguer has brought a hotelier's perspective to Thomas Cook Hotels & Reosrts

Thomas Cook wants to take tighter control of its hotels through more management contracts, sell more rooms to group tour operators and expand its portfolio cautiously, hotels chief Enric Noguer told fvw in an interview.

Europe's second-largest tourism group currently has 200 own-brand hotels with a total of 40,000 rooms trading under eight brands (Sentido, Casa Cook, Cook's Club, Sunwings, Sunprime, Aldiana, Sunconect and Smartline). About 85% of these are franchises and only 15% are directly managed by the group.

But Noguer, an experienced hotel executive who took over as head of Thomas Cook Hotels & Resorts a year ago after previously working for Iberostar and TUI, wants to gain more control over the portfolio's sales activities.

"In future, we will focus more on the management operating model," he said. He aims to double the current number of 30 managed hotels. "I think that 30% under our own management and 70% franchise is healthy." But he does not want to go beyond that. "More management (contracts) would expand the organsiation too much."

Another priority is to sell more of the portfolio's capacity within the Thomas Cook Group. About 70% of the 200 hotels are exclusively bookable through the group's tour operators but these only account for about 50% of the 10 million room nights sold each year. The rest of the rooms are marketed through portals such as Booking.com and Expedia, the hotel brands' own websites, Condor and other tour operators.

"Of course, we can achieve better prices in some other sales channels than with the (Thomas Cook) tour operator. But they do not bring the volumes and room utilisation that I need throughout the year. Only the tour operator can do that," explained Noguer.

There is still plenty of potential to welcome more Thomas Cook guests in the group's own-brand hotels. At present, only 1.2 million out of the group's 10 million total customers stay in a group hotels, which is not even a 10% share. "That shows the potential we still have with the tour operator. I can certainly imagine a share of 30%," Noguer said confidently.

This target also lies in the interest of Thomas Cook Germany chief Stefanie Berk. "We can implement our ideas for a good product best with our own hotels," she explained. "After all, the hotel counts for 80% of the holiday experience."

In terms of the portfolio's size, Noguer is backtracing from the target of former hotels chief Ingo Burmester who aimed to expand to about 300 own-brand hotels in the medium term. "We want to have 250 hotels in the portfolio by 2022. With our expansion it is not volume but the value and the quality of the hotels that plays a role," he emphasised.

This year, for example, Thomas Cook will add 20 hotels with more than 3,000 rooms but take 10 others with relatively low Net Promoter Scores out of the portfolio. "It doesn't make sense to continue with a property with customer satisfaction of less than 30 (points)," Noguer said.

Neither Noguer nor Berk wanted to comment on how forthcoming changes to the group's shareholder structure, with the arrival of China's Fosun as majority owner of the tour operator business, might impact on the hotels business. But Berk noted: "When you see how Fosun is supporting development of the Club Med brand, you can be very confident."

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