SWOT Analysis of Thomas Cook

 

Source: Medium

Thomas Cook Group plc is a British global travel company. Thomas Cook AG and MyTravel Group plc merged through the formation of 'NewCo' in June 2007 and formed this leisure travel group which then got listed on the London Stock Exchange. Now, here we will look into the details of the  SWOT Analysis of Thomas Cook. Here we have looked forward to finding out the strengths and weaknesses of our company. Also, we tried searching for opportunities to dig into and the threats to be aware of.

 Strengths of Thomas Cook Group plc:

1)One of the oldest leading and largest global travel groups in Europe: Thomas Cook Group plc is one of the oldest and largest leisure travel companies in the world. It served almost 20 million consumers in more than 15 countries. They offered lots of different kinds of services with a focus on airlines, hotels, forex, and tour operations. Being a one-stop-shop gave Thomas Cook a competitive advantage.

2) Strong and high brand presence: Thomas Cook works with 8 brand names in 200 different hotels with 190 own brand ones. They accessed all kinds of advertising and promotional mediums like digital marketing, TV ads, etc. Even it has a very user-friendly and good website. Associating with the London Olympics 2012 and football teams like Manchester City gave them a strong presence everywhere.

3) Global presence: This company has served 16 countries with all kinds of facilities. Their services in airlines, hotels and resorts, tour operations, holiday packages, forex, and all other spheres have made Thomas Cook Group plc globally acclaimed in all senses.

 

4) Budget-friendly and convenient: With all their customised and flexible packages and offer prices, Thomas Cook has succeeded in providing their customers with easily accessible and pocket-friendly holidays.

5) Huge customer base: Being a global travel group Thomas Cook is considered to be one of the favourite travel shops of all the travellers. So obviously it has huge widespread coverage of more than 100 destinations over the world and over 20 million customers. Its website only has 10.5 million consumer profiles.

6) Diverse employment strengths: As we have already known, Thomas Cook is well-known for their services and has approximately 22000 employees all over their chains sitting around to help their customers which works as a great strength of the company.

Weaknesses of Thomas Cook Group plc:

1)Struggling financial condition: Thomas Cook's declining financial performance is utterly upsetting. The financial condition is causing issues. Tough times like this makes these types of big firms quite vulnerable.

2) Too many brands: Thomas Cook works with 8 brand names. They have 190 own-brand hotels. According to some analysts, this might be confusing for some customers.

3) Limited market share: Thomas Cook Group plc is a part of one of the largest service industries which is the Travel industry. More the number of sellers, the more the degree of competition. However, it is quite difficult to sustain in these types of highly competitive markets with such a limited market share.

4) Poor website review: Despite providing multiple kinds of services some customers seem to be unsatisfied and complain about their services. Even on social media and review websites, one can find some complaints regarding this customer dissatisfaction which endangers the brand value of the company.

Opportunities of Thomas Cook Group plc:

1)Growing at a fast pace: The travel industry is one of the largest service companies today and it is growing at its maximum speed all over the world. This is a great opportunity for our company 'Thomas Cook' to expand and create a market for their services with all the more profit. They just have to hit the dart to the right place.

2) Opening new hotels and resorts: Thomas Cook opening new hotels in Turkey, Spain, Greece, and Egypt has already shown some results. So we can say that the openings of new hotels and resorts in existing and new markets are great opportunities for Thomas Cook to expand the business.

3) Globally expansion: Thomas Cook Group plc is already one of the leading and largest global travel companies. So, naturally, they already have a wide market base. It will be a beautiful opportunity for them to fatten their pocket if they can tap the ever-expanding potential of the international market. This global expansion will also have many other good benefits.

4) Digitisation of the operations: The globe is getting digitised. It is important to get technologically updated to reach out to every corner of the world nowadays. Getting digitally more strong will help the company to reach the population around the world. There is a huge scope for improvement and this will help Thomas Cook positively in the path of business expansion.

 

5) Love Local: Love Local is a newly constructed in-resort activity-based program of Thomas Cook Group plc. These activities are based on local communities and traditional activities which certainly have attracted the old and new consumers. This is a very nice proposition for the company in penetrating different kinds of markets.

Threats to the Thomas Cook Group plc:

1)Growing competition: Considered one of the largest service industries Thomas Cook already faces a lot of competition. Moreover, low-cost service providers have become a threat to the company. For this sole purpose, the pricing system has always to be taken care of as market share can be decreased anytime soon.

2) Uncertainties in the Airline sector: Thomas Cook Group plc has always faced lower profitability in their airline business. This is endangering the company's financial performance. The airline business of the company has always been a threat to the business. Even this sector is very much uncertain and some are anticipating bankruptcy if someone goes wrong.

3) Dynamic Government regulations: Government affects businesses directly. To avoid major setbacks the company has to take care of the government. So, dynamic government regulations are a well-known threat to any company.

4) Uncertainties: Everything changes when some accidents happen. Events like the Global trade war or Brexit disturb the whole business. Situations like these demand immediate attention and action. They are of course some threats.

5) Rising cost of materials: Rising fuel prices is another threat that can affect airlines which directly affects Thomas Cook Group plc's business.

Case discussion:

Our Swot Analysis of Thomas Cook Group plc reflects the market situation of the company. If we look into the three C's which stand for Customers, Costs, and Competition, we can find out that there were a huge amount of customers of this company, the cost of materials was increasing due to some previously discussed issues and finally, Competition was high. If we keep the insane customer count aside, every other factor showed that business was declining. 

Even the customers got ample numbers of complaints against the company which they posted on social media and other review sites. If we dig deeper we must find that the travel and tourism industries are quite competitive and the whole business scenario for them has been changing constantly. 

With the constantly changing technology at a very fast pace, recent trends and upcoming developments have changed the face of the travel and tourism industries. One of those main factors that changed the face of the travel and tourism industry is 'social media. Social media didn't only improve the connectivity methods it has also helped the industries to enhance their businesses. 

Developments and significant business growth in recent days were solely dependent on this social media marketing. Thus digital media plays a vital role in the travel and tourism industries.

 

Now our question is has this social media worked as a revenue generator for our company or distracted it? On one hand, we can see unsatisfied customers writing bad reviews and complaining about the bad service on social media which demotivates the other customers and leads to a decrease in the company's brand value. 

By this, we can say social media played a negative role and caused a loss in the business. But on the other hand, we must always know that if not for social media we wouldn't have been able to capture the whole world as our market and penetrate the business. Thomas Cook Group plc had over 10.5 million people logged in to their official website. 

Perhaps this would not have been possible without the help of digital marketing. Here comes our second question, how good was their strategy regarding digital marketing? Or do they need any other strategy to improve their business? This can not be answered very precisely. We need to discuss that further.

New social media strategy:

The global travel and tourism market is enormous and it earns over 1.3 trillion dollars of revenue per year of which 755 billion dollars were digital travel sales in 2019. So now we can have a basic idea of the degree of competition it has reached in digital marketing over the past few years. Thomas Cook tried to digitally transfer their customers to their possible locations but with such fierce competition, every company has to find out some new and unconventional digital marketing strategies to excel. 

Let us now explore some key strategies for the development of social media and mobile technology in tourism which will lead us to the answer to our previously asked question, that is ''What strategies should Thomas Cook Group plc apply?"

1)Make the target audience the centre of attention:

 Without making your customers feel important and valuable you can not make sales. For that you have to identify your audience, you have to have full knowledge about their preferences and demands and you must give them the front. You know what product you sell. So you have to recognize the people who will be interested in buying it. 

Sometimes it can be old people and sometimes it will be young couples. You must know the characteristics of the buyers of your products so that you can target more and more people from that category. 

Sometimes it helps if you put yourself in the buyer's shoes. Try thinking about what you would have wanted to see on a hotel's website if you wanted a hotel or a resort on your vacation and try implementing that.

 

2)Utilize every kind of social media platform:

 People nowadays have accounts on every kind of social media platform. They try to find holiday destinations and hotels on Facebook, Instagram, Pinterest, and where not. You must have a purposeful social media presence. Opening an account is not enough. 

You have to try to engage people with you by constantly replying to their requirements and comments and by offering proper customer care. Do not ignore your emails even. Every exchange has to be a motivation for that customer. You can also go for paid advertising campaigns on Facebook, Instagram, Twitter, Pinterest, etc. You can work with the influences of social media to promote your product.

3)Provide social proof:

 Most of the time vacations are not impulse buys. People plan their destinations, routes, and hotels. Be ready with all the plans to provide them. Have a resourceful website and social media platforms where anyone can see your photos and videos. 

Keep your review sites impartial. Reply to all kinds of reviews, good or bad. Good reviews are a delight to receive. Reply to those with gratitude and love. Criticisms are also welcome, remember that. Provide your customers with courteous apologies and demonstrate your remedial work. Optimise your content.

4)Leverage Engagement Data and SEO: 

Use tools like Google Analytics and Facebook pixel to analyse your data which will help you to understand your social presence. These dates will help you to understand your audience better and to create more personalized contents which will help you to increase your sales. 

Search engine optimization or SEO is the key to cutting your campaign costs. Maybe it takes time to be built but after establishing your brand presence SEO will help you to pop up in greater terms and to get organic traffic.

 

I would like to conclude this section by saying that digital marketing is about showing off the experience in the greatest possible way. Remember to make sure that your campaigns don't go unnoticed and that a positive impression is made on the customers. 

Utilise the peak times to create content that touches everyone's desire to go for a vacation. Establish your individuality online to ensure the offline journeys of your visitors so that you can run a successful business. 

Written by Jayesh Tibrewal