Tui to expand dynamic packaging for UK consumers

Tui Group expects to increase its market share in the UK by offering more flights and expanding its dynamic packaging offer to British holidaymakers.

The development of its Tui Flight Market Place service means it can offer different durations for holidaymakers who may want to book flights with other airlines rather than Tui.

Sebastian Ebel, chief executive, said: “In the UK, we want to offer new products to our customers, more content, more airline seats, and more directly connected, quality proven hotels. Our target is to have the best hotels in our portfolio.”

He said customers would in the past book durations of seven, 10 or 14 days but now Tui can cater for those who want to travel for five or 12 days, for example.

Ebel was speaking after the company’s Q2 results, for the three months to March 31, which showed that the UK continues to be the most advanced sold across Tui’s pan-European network.

The UK market has 64% of the summer 2023 programme sold, compared to 55% across the Tui Group. Average prices for summer 2023 are now 5% above last year and compared to summer 2019, average prices are 26% higher.

More: UK outpaces summer booking levels across Tui network

Dynamic packaging customers can book with a range of other carriers such as Vueling or Eurowings, Ebel said, adding that the only airlines still missing are British Airways and Iberia.

“The biggest benefit is we get the market price of the airline into our system. So there’s not the risk that we are too expensive so customers don’t buy and there is not the risk that we are too cheap. And this is a major step forward,” said Ebel.

The UK market will have 1.1 million extra flight seats for 2024, which will “enhance” the dynamic offer.

Describing dynamic packaging as one of the “strong pillars” of Tui’s growth strategy, he said: “We are able to plan to sell significantly more in the UK because of access to variable stock.”

Ancillary sales will also form part of that growth, he said, with dynamic pricing for special seating on aircraft, depending on how full the flight is, and add-ons such as pre-booked tee times for golfers.

Ebel said the trend for higher value products and longer stays is “very much intact” and helps the company to offset the impact of inflation.

However, he pointed out that inflationary effects in destinations and cruising are less than in the UK or Germany.

About a third of the price increases is to counteract inflation, another third is because of higher quality products, and the final third gives Tui a better profit margin, he explained.