Abstract
This study deals with the strategic moves made by TUI travel Plc in an attempt to maintain a competitive advantage in the European tour operators industry and in tourism globally. The overriding concern is the various methods that the company has managed to ensure that it maintains its large share of the market and maintains growth and satisfactory profit margins. The paper examines the challenges faced by the company in the industry and the major emergent issues in the industry that affect the ability of the company to remain competitive. Innovation strategies and new products by the company are examined and the effectiveness of the same in improving the company’s ability to compete better in the increasingly competitive industry. The applicability of Porter’s Generic Strategies to TUI Travel Plc competitive strategy are analysed and assessed and conclusions drawn. The future of the tourism industry is explored in the study and recommendations made. The direction of the industry in the next five years is also discussed and conclusions similarly drawn. The competitive strategy of the company is found to be sound, and a bright future. The company has invested in several strategies to ensure that it maintains competitive advantage in the market. The company’s future in the industry is secure, if the company will effect suggested strategies towards improving its competitive strategy it is set to do even better in the industry, in coming years.
1. Introduction
The tourism industry globally has increasingly become more competitive over the years. This has had a profound effect on the tourism industry globally and has made the industry a multi-billion dollar endeavor. This has no doubt in recent years led to a lot of interest in the field with many investors rushing to acquire a share of the large profits in the industry. As such, the pre-existing businesses in the industry have had to deal with a lot of new competition from new businesses and more aggressive competition from their usual competitors. This paper focuses on TUI Travel Plc as a major player in the tourism industry, notably in Europe. With the thriving of the tourism industry globally TUI Travel Plc has been one of the major industry players which has encountered a lot of competition from existing and new players in the industry. This case study explores the mitigation strategies the company has employed against the new-found levels of competition in the industry.
1.1 TUI travel PLC
TUI Travel Plc is no doubt one of the leading leisure travel companies in the world. The company has a reach of over 180 countries around the world. This affords the company the luxury of over 30 million customers and a huge global human resource base. Furthermore TUI Travel Plc owns and runs its own airline company to cater for its travel needs. The company mainly arranges trips and adventures and various holiday retreats around the world, branding each of them differently and pricing them as such (TUI Travel Plc 2010). The company has been recognized as one of the world leading provider of specially packaged and branded travel experiences and destination travels (UNWTO 2011). It offers all-inclusive travel packages to its customers, a thing which they achieve mostly through travel agents set up in their source markets. A typical package consists of travel arrangements to and from the travel destination, both by air and vehicles, accommodation, various related activities depending on the type of adventure desired as well as meals and insurance which are optional.
The goal of the company is mainly to package all the processes and involved in a vacation in to one purchasable package, so that the vacationer does not have to worry about making all the plans by themselves. It eliminates the hustle of planning and organizing things for the vacationer. The company operates nearly 200 activity brands all over the world that offer their customers a wide range of travel experiences including adventure, sport and luxury experiences. The company caters to tour operators, cooperate clients as well as individual clients worldwide (TUI Travel Plc 2012).
1.4. Industry Analysis
An industry is a group of firms that market products, which are close substitutes for each other. Some industries are more profitable than others because the answer lies in understanding the dynamics of the competitive structures in an industry (Johnson et al 2011). The global financial crisis throughout the year 2009 and a part of 2010 almost brought the industry to a halt (Josephides 1993). Tourism activity is inextricably tied to both domestic and international economic and environmental conditions (UNWTO 2011). Change in household disposable income was a factor that greatly came into play during the credit crunch. As a result many would-be consumers in the industry chose to abstain from recreation activities, such as forms the bulk of the tourism industry and instead chose to hold their money. However, according to Blanke and Chiesa (2011) in 2010, tourism globally was recovering and that tourist numbers were rising and doing better compared to the previous year.
1.2 Objectives of the study
• This study seeks majorly to analyze the choices that TUI travel Plc has made in a bid to make sure that it remains viable and maintains its competitive advantage.
1.3 Competitive Advantages
TUI travel Plc has managed to over the last decade establish itself as leader in the tourism industry. The company has maintained high profit margins and a strong brand awareness and presence among consumers (Industry Update 2011). One of the most significant advantages that TUI travel Plc has over other in the industry is its large asset base. The company has invested in key assets that have acted as a huge impetus to the growth of the company. The acquisition of aircraft to be used in its travel business has saved the company a lot of money in chartering planes. The building and purchasing of over three hundred hotels globally has equally made the company relatively self-sufficient in the provision of accommodation to its clients. In this way the company is able to save large sums of money, which it would have otherwise used for renting accommodation from other hotels. (TUI Travel Plc 2012).
The company’s wide reach and expansion internationally is another factor that has acted as an advantage and an impetus to growth and the rise of profits. It helps to strengthen brand awareness all over the world and lead to higher numbers of customers which translates to higher profit margins. The company‘s presence is felt in over 180 countries and 27 key source countries. (TUI Travel Plc 2012).
The huge number of brands under which to manage all its different products is a thing that has helped to grow the company’s business globally. TUI travel Plc operates under 200 brands worldwide. The diverse range of packages offered by the company in its bid to ‘make travel experiences special’ in line with its vision, have resulted in increased customers, especially among well-to-do individuals and corporate organizations who are willing to pay to avoid the hustle that comes with vacation preparations and logistics (Ambe,2010).The huge scale of the company also gives it an advantage when negotiating with suppliers.
The flexibility of TUI Travel Plc as a company affords it the ability to comfortably and efficiently manage their capacity to handle changes in the market such as demand and supply. This makes the company’s profitability less volatile (TUI Travel Plc 2012). The company has identified two hundred pounds worth of synergy benefits due to the mergers it has undertaken. The company specialization into the service sector has greatly spurred growth. Up to a third of the company’s profits are generated by niche specialist branches (TUI Travel Plc 2012).
2. Dealing with Competition
2.1 The competitive strategy of TUI Travel Plc (Porter’s Generic Strategies).
Porter’s five forces frameworks provide a clear and deep analysis of the strategic vision, the competitive advantages and allow businesses to determine the best appropriate market (Porter 1980). TUI Travel plc can operate and stay competitive in various sectors. Furthermore, the dynamic character of the external surroundings should be taken into consideration in this analytical framework as TUI Travel Plc is functioning in a highly competitive environment, which is also very sensitive to any political, social and other changes, possibly influencing the overall motivation of customers to stay.
Companies and businesses which operate in competitive environments often have to establish ways and means to achieve their goals and to remain viable in competitive. They have to often develop strategies to achieve their goals .The goals derive from the company mission and vision which guide the company objectives. The mission statement can be described as “purpose, which should be created and well understood by the board of directors as well as shared with entire organisation to have an equal set of goals and objectives” (Thompson and Martin 2005 ).
Porter (1980), proposes strategies usually used or that may be used by businesses to achieve as well as maintain competitive advantages over other key industry players. He proposes focus on mainly Strategic scope which mainly refers to focusing on the size and composition of the market in which a business is operating and addressing itself to those needs.
Michael Porter (1980) mainly narrowed these down to three basic focal points when seeking to analyze and develop strategies for competitive advantage; cost leadership, differentiation and market segmentation or focus. Porter recommended the combination of the approaches to achieve maximum competitive advantage. In the same breath the Porter’s five forces framework is used to analyze business strategy and the industry as a whole.
The most influential analytical model for assessing the nature of competition in an industry is Michael Porter’s Five Forces Model. Porter’s Five Forces Framework examines the five forces that determine industry attractiveness and long-term industry profitability (Johnson et al 2011 p. 54).
Porter’s five forces frameworks provide a clear and deep analysis of the strategic vision, the competitive advantages and allow businesses to determine the best appropriate market (Porter, 1980).
COST LEADERSHIP
Ownership of its own airline
Offer holidays packages with cheaper price from their own transportation.
Huge amount of customers DIFFERENTIATION
Provide unique and custom-organized traveling and vacation in Europe.
Offer variety of choices for holiday packages according to individual need and expectation.
Provide unique experiences, services, processes, human resources and organisational knowledge.
FOCUS
Concentrate mainly on travel and holiday packages to the exclusion of sale of physical products.
Access to different kinds of market and different kinds of consumers worldwide.
Cost Leadership
The major strategy that TUI travel Plc employs in a bid to maintain competitive edge in the industry is cost leadership. In cost leadership Porter‘s generic strategy explains that a company or business sets out to provide goods and services at a relatively lower price than other players in that industry. This may be pursued through economies of scale by a business, through cutting-edge technology that makes productions cheaper or even preferential obtaining of raw materials or other factors of production (Porter 1980). TUI Travel Plc has been able to relatively establish cost leadership.
Ownership of its own airline as well as the control of several others serves to reduce the cost of transportation to its customers. This makes it possible for them to offer their holiday packages which include transportation at much cheaper prices than those that individuals or corporate would have incurred if they were to undertake individual planning of each part of the holiday package the price that is finally borne by the consumer also reduces in comparison to that offered by competitors. The company’s large clientele and enormous region of operation affords it the opportunity to practice economies of scale by being able to lower prices without incurring losses, relative to its competitors (Ambe, 2010).
Differentiation
Porter (1980) describes differentiation as a strategy in which a business, company or organization seeks to make its products or services unique in its industry. A company in this case would seek to make its products particularly unique and of higher quality than others products in the same industry that are highly valued. A company would select particular aspects that consumers value highly in a particular industry and capitalize on meeting these needs in exceptional ways. In this way a company is able to establish itself as unique and can then charge premium prices (Oxford Writers 2011). In that quality of service has become the focal point of international competition, the key of success lies in the extent to which a company can offer products and services of superior than those of competing companies both domestically and internationally.
TUI travel specializes in making traveling experiences special for their customers (TUI Travel Plc 2011). The company has used differentiation as a strategy by majorly establishing itself as the leading provider of unique and custom-organized traveling and vacation experiences in Europe. The company has organized different travel/vacation packages for its customers including TUI Travel vision statement is as follows “to be one of the world’s leading travel groups by providing our customers with a wide choice and the flexibility to meet their ever changing needs.” (TUI Travel Plc 2012). This well pointed vision statement of TUI Travel Plc demonstrates that they have a strong desire to be one of the best leading travel groups and to provide their customers with a variety of choices in order to meet needs and expectations. Also, strategic capabilities of TUI Travel Plc may among others be characterised with values such as rarity and non-substitutability. The value criteria are due to the fact that they provide potential competitive advantage, are valued by customers as well as other stakeholders. Rarity is derived from the fact that they provide unique experiences, services, processes, human resources and organisational knowledge.
In its differentiation strategy which basically involves setting the company apart from other players in the industry in terms service and product quality as well as uniqueness, TUI has employed flexibility of service as well as variety. The company not only offers specialized and high quality services, but offers them in a wide variety. Among its travel and holiday packages are sports, adventure, luxury, and beach. Hiking packages to suit all kinds of consumers and adapted to different locations. This variety serves to position the company as the most likely to be chosen by a customer who was looking for such packages. The variety of product packages instills confidence in the customer. The sale of Hapag –Lloyd a branch of the company have afforded it more liquidity as compared to its counter parts in the industry and this is has given the company competitive advantage in the industry by allowing the company the financial resources to even further improve its products (Grant,2010 ).
Focus
The third aspect of strategic positioning for competitive strategy, in reference to TUI travel plc and porter’s generic strategies, deals with focus. In this strategy a company may chose a section or a group of sections of operation in the industry and chose to capitalize on the same, largely to the down -playing or the exclusion of others (Porter 1980). TUI travel Plc has capitalized on holiday /vacation making and made it the main focus of its operation. The company has focused on services as their major market segment. The business has majored on services other than products. In this way, the company has been able to maximize its competitive advantage in the industry because it has had the opportunity to perfect its services in the special holiday /vacation packaging sector of the industry. It has therefore been able to distinguish itself as the market leader in Europe in the same.
Since TUI travel Plc is already an established company and as wide reach internationally, its use of a hybrid strategy of porter’s generic strategies for competitive advantage is directly and fruitfully applicable. Its access to different kinds of market and different kinds of consumers worldwide means that different strategies of the porter’s generic strategies can be applied in different settings as applicable. However the company has chosen to focus on cost leadership and focus as their two strategies.
2.2 Innovation Strategies
Innovation strategies in this cases focuses on the development or invention of new products or services for the purpose of introducing to an existing market. The same can be done for the purposes of creating a new market. Such innovation is done with the aim of distinguishing a company as unique in its products and services. This is done ideally to increase sales.
Among its many innovations and introductions in recent years, TUI Travel Plc has introduced a campaign for sustainable development, which they intend to demonstrate by the way the business runs its operations globally (TUI Travel Plc 2012). As businesses globally evolve to meet changes in consumer behavior, TUI Travel Plc has made a bold step towards addressing itself to the growing concern and interest for the environment and sustainable development among consumers. This is especially true of people in Europe, North America and Australia.
People are placing increasingly greater value on the protection of the environment (Ganadharan 2012). This concern comes in the wake of the ill effects of climatic change being experienced globally. Most businesses, especially those in the tourism industry are facing the increased pressure from customers to be protecting the environment in which they operate and especially in areas where business activities rely mainly in natural assets and that are of a cultural nature. Since nature-based tourism is a fundamental in part of TUI Travel Plc‘s business operations, the company has become innovative when it comes to issues of environmental protection, which are inextricably linked with sustainable tourism (Oxford Writers, 2012).
TUI Travel plc’s innovations include embedding sustainable development in the way the company does its businesses. The business has set in motion plans to reduce the amount of carbon dioxide emitted into the atmosphere as a direct or indirect result of its operations. The company has embarked on the replacement of its existing energy sources that pollute the environment with those that did not. TUI Travel plc has also committed to improving livelihoods as well as protecting the environments in key regions where they operate. Its supplier shave also been incorporated into the campaign by being encouraged to adhere to the same principles. Its staff is also been educated on issues of sustainable development and protection of the environment and being encouraged to share the same with other stakeholders. (TUI Travel Plc, 2012). TUI Travel Plc is ensuring the integration of the same in to all its work streams, which include airlines, water travel, ground transport, major premises, supplier management, destination projects and its human resource force. The move is mainly a function of market pull as compared to technological push as it is mainly a response to consumer behavior changes.
Among the justifications of the move is that the company will be able to impact the environment and related cultures positively. The company in addressing itself to the consumer needs will also attract more clientele and boost its public relations image in the eyes of the public as well as its ‘green-consciousness’. This ultimately reflects well in the balance sheet (Walsh 2005).
2.3 Future Strategy for TUI Travel Plc
TUI Travel plc is currently the market leader in the industry in Europe and currently ranked 12th in the world. The company maintains a large share of the market with its competitors Thomas cook, Rwewe, Kouni and Club med trailing behind it. It is listed in the London stock exchange and has achieved market dominance largely through aggressive mergers since the time of its inception.( TUI Travel Plc, 2012 )
In determining the strategic direction for the company in the future the use of the Ansoff matrix is made. The Ansoff product/market matrix is a tool consisting of a series of suggested growth strategies that determine the direction of a business or a particular firm. The four constructs of the matrix include market penetration, which involves a strategy of selling existing products to existing markets, seeking to maintain market share and eventually increase it. The second is market development where a business sells existing products to new markets. The third, product development involves growth by introducing new products in existing markets. The last is diversification where new products are introduced to new markets ( Thomas and Martin, 2005).
In the case of TUI travel Plc, the company’s future strategy should involve application of different constricts of the Ansoff Matrix of strategies to different areas of operation in its business. In its already established markets, the company may decide to introduce new products thus embracing the product development construct of the matrix. In unstable markets, TUI travel plc may benefit from maintaining existing market shares and thus embracing market penetration. The company may also do well by introducing its current products in to new market. There are many unexplored markets that the company could introduce its products. Since the company has the advantage of extra liquidity from the sale of some of its assets it could take calculated risks to introduce new products in new markets provided research concerning those market s and product-reception is exhaustively done. TUI Travel Plc would benefit from using all constructs of the Ansoff Matrix and apply them as suits its different context of operation.
ANSOFF MATRIX EXISTING PRODUCTS NEW PRODUCTS
EXISTING MARKETS MARKET PENETRATION
Leading market share
Strong presence in European market
Make a brand/ marketing campaign
Enlarge on-line services PRODUCT DEVELOPMENT
Low cost packages
Specific oriental packages
Reduce dependency on air travel (fuel & lower cost travel)
Offer direct flights to existing destinations
NEW MARKETS MARKET DEVELOPMENT
Concentrating on Russia, India, and China
Could make their presence in transportation DIVERSIFICATION
Offer specific packages for gay/lesbian travellers
Offer tour financing to customers
Offer direct flights to new destinations
Membership card with frequent traveller benefits
They had already penetrated to the European markets and are one of the leading market holders of tourism industry all over the world. Depending on the findings (key drivers) on the previous analyses along with ANSOFF matrix the future implications of TUI are explained in the following analysis.
The air travel boom just before recession was fuelled by short distance. The low cost airlines took the most advantage from it, but the recession changed the picture completely. Customers who travel with rail, buses and ferries found that is the cheaper options even though these transport options take more time. However, 90% of TUI’s travel options are through airlines. This could be an opportunity for TUI to extend its differentiation by providing land transportation and thus also take advantage of the emerging trend of short distance travellers. (Gangadharan 2012)
Another trend that TUI must take into account is the on-line services. While in the past high entry barrier existed for entering into the tourism industry, nowadays Internet technologies are changing the rules of the game substantially. Companies like lastminute.com and expedia.co.uk for example have established themselves in the online tourism industry. A Mintel survey report shows travel as the main spend category through online. TUI can improve their market share and also reduce their cost basis and save some money by offering more on-line services rather then maintaining agencies and offices. (Gangadharan 2012)
Having their own airline and the majority of bookings including air travel, TUI is very exposed to fuel price changes. Fuel Price fluctuations are having a major impact on the world business. Due to its size and consumption TUI can negotiate better prices and more favourable hedging conditions than smaller competitors for a specific period of time with the oil companies to stabilise the variations. Besides that, TUI should take more consideration into the environment factor, as more and more customers prefer to travel with the companies who are aware of environment, which may impact on the business in the future. (Gangadharan 2012)
Being the market leader in the tourism industry in Europe they have a strong home market and can use the money from this market to build up the future emerging markets such as China, Asia in general, Russia, India etc. They should not only focus on traveller travelling to those countries but particularly also customers from those countries travelling to Europe, US etc. This helps them to diversify their market portfolio and can have the advantage that in recession times in Europe, for example Asian or Russian customer may still visit Europe because they may not have recession.
As TUI has its own airline and is also operating or holding shares in hotels, cruise lines and travel agencies they can keep their margin a bit higher as there is not so many companies in between them and the paying customer. This requires, however, good knowledge to manage different segments well. With a strong market position in Europe and also worldwide, TUI must strengthen its band recognition and maybe run a global marketing campaign. One channel of doing that could be the use of social media by creating a larger presence in Facebook, Twitter, blogs, etc. (Birjukova 2012)
As many parts of the world become more open to gay and lesbian people TUI may offer special packages that cater for those groups of people. Also, TUI may expand their services into allowing customers to pay their bookings in monthly instalments rather than in a one-time payment to allow lower budget traveller to book trips. TUI should further improve their service with more direct flights to existing destinations are now only reachable with connecting flights or also to new destinations. Furthermore, TUI could make its offering more attractive and increase customer loyalty with creating a membership program (miles) that rewards frequent TUI travellers with benefits, such as additional free hotel nights or if the customers reach 20,000 miles they may get a free flight in Europe etc. In general, the company needs to improve all its current services in quality and inclusiveness as these two factors are great determinants of customer choice in a competitive market (Thomas and Martin, 2005)
2.4 The industry in Five Years Time
Porter’s Five Forces Framework examines the five forces that determine industry attractiveness and long-term industry profitability (Johnson et al 2011 p. 54). TUI Travel Plc is functioning in a highly competitive environment, which is also very sensitive to any political, social and other changes, possibly influencing the overall motivation of customers to stay. According to porter’s five force analysis of the industry, competitive rivalry is influenced by number of competitors, industry growth rate, costs, and degree of differentiation. The threat of substitutes in the inquiry is influenced by switching costs and relative price and performance substitute (Thomas and Martin, 2005). The power of buyers in the industry is directly impacted by lower switching costs, substitute costs and the standardization of products. The power of suppliers in the industry is influenced by the concentration of suppliers while the threat of new entrants into the industry is influenced by their level of experience, expected retaliation from existing players, differentiation and access to supply and distribution channels. These factors need to be considered in the company’s future strategies and mitigation strategies incorporated into activities.
The industry is experiencing a decline in product innovation and instead focusing on process innovation so that dominant designs will emerge (Grant, 2010 ). In the near future there is bound to be an increase in the number of players in the industry as middle-level companies start to experience growth, and become formidable forces in the industry. Still there is the possibility of the rise of many new entrants into the industry. In the future competition is therefore expected to be very aggressive. As such TUI Travel Plc should gear up for even more intensive competition and should accommodate this possibility in its planning and strategizing for the company’s future.
3. Conclusions and recommendation
In the company’s strategy to maintain a competitive edge over its rivals, the company should fully focus on international expansion and available markets in different continents.
TUI Travel Plc has systematically established a very strong position in its market and therefore become one of the global market leaders. However, also a number of critical issues were found out where TUI Travel Plc needs to pay close attention in order to maintain its strong market position. For instance, TUI Travel Plc has to come up with an alternative plan to overcome substitute products. Being better than the competitors, core competences and complementary capabilities are playing an important role in order to make sure that the customer is fully satisfied and finds his expectations exceeded.
In recent years, costs of fuels are gradually increasing due to shortages on fuel. Instead of fuels, TUI Travel Plc has to search for substitutes in place of fuels to reduce their cost on oil. As TUI Travel Plc is active in a number of tourism segments such as cruise, accommodation and destination, this brought them huge consolidated fixed assets on the balance sheet. TUI Travel Plc should focus on their mainstream of business since mainstream business is their most important business income and allow saving fixed costs. It should also fully take advantage of the economies of scale that such a big operation has, for example, negotiate best prices and conditions with suppliers and partners. Because travel experiences, especially leisure travel, are very important to the travelers and usually like to be shared with family, friends and colleagues, TUI Travel Plc should carefully monitor today’s Internet platforms where such exchange is done. Therefore a professional social media strategy is highly recommended. Blogs, Face book, Twitter etc. are a must for TUI to take part in.
Reference list
AMBE, I.M., 2010. Agile supply chain: strategy for competitive advantage. Journal of Global Strategic Management, 7, pp. 5-14.
BIRJUKOVA, A., 2012. TUI: achieving and maintaining leadership in the European tourism industry. [online]. Available from: http://www.scribd.com/doc/54689914/Tui-Strategy[Accessed 1 July 2012].
CLIFFORD, D.K., 1973. Growth pains of the threshold company. Harvard Business Review, pp. 143–154.
GRANT, R.M., 2010. Contemporary strategic analysis, instructors’ guide: an overview. 7th ed. [online]. Available from: http://www.contemporarystrategyanalysis.com/pdf/IMOV.pdf [Accessed 03 Jun 2012].
GANGADHARAN, S., 2012. TUI Analysis and Implications. [online]. Available from: http://www.scribd.com/doc/25781511/TUI-Analysis-and-Implications[Accessed 5 July 2012].
JOHNSON, G., WHITTINGTON, R. and SCHOLOS, K., 2011. Exploring strategy:
Text & cases. 9rd ed. Essex: Pearson Education Limited.
JOSEPHIDES,N., 1993. Managing tourism in ressesion. Tourism Management. 14(3), pp. 162-166.
INDUSTRY UPDATE, 2011. Five Year Tourism Strategic Plan Industry Update. [Online] Available from: http://www.tourismnt.com.au/Portals/3/docs/strategy/5YR_StrategicPlan_April_2011_FA.pdf [Accessed 7 July 2012].
LENZ, H. and ROBSON, G., 2011. Europe seminar. [online]. Available from: http://www.visitbritain.org/Images/VIBE%202011%20Europe%20with%20partners_tcm29-28516.pdf [Accessed 29 June 2012].
OXFORD WINTER, 2012. Amazing and strategic changes of TUI. [online]. Available from: http://www.oxbridgewriters.com/essays/business/amazing-and-strategic-changes-of-tui.php [Assessed 2 July 2012].
OXFORD WINTER, 2012. Free marketing essays- key macro environment issues affecting tourism in Australia. [online]. Available from: http://www.oxbridgewriters.com/essays/marketing/environmental-issues-affecting-tourism.php[Accessed 3 Jun 2012].
PORTER, M.E., 1980. How competitive forces shape strategy. The McKinsy Quarterly, pp. 34-50.
THOMPSON, J. and MARTIN, F., 2005. Strategic Management: Awareness and Change, 5th ed. Thomson Learning
TUI AKTIENGESELLSCHAFT, 2012. Environmental management and ecological sustainability. [online]. Available from: http://www.tui-group.com/en/sustainability/env/managament. [ Accessed 2 July 2012].
TUI TRAVEL PLC, 2012. Welcome to TUI PLC. [online]. Available from: http//www.tuitravelplc.com/ [Assessed 30 June 2012].
TUI TRAVEL PLC, 2012. Vision &value. [online]. Available from: http://www.tuitravelplc.com/about-us/vision-values[Accessed 03 Jun 2012].
TUI TRAVEL PLC, 2012. About us. [online] Available from : http://www.tuitravelplc.com/about-us/vision-values [Accessed 7 July 2012].
TUI TRAVEL PLC, 2008. TUI Annual Report. [online]. Available from: www.analist.nl/reports/TUI-2008.pdf. [Accessed on 5 July 2012].
TUI TRAVEL PLC, 2009. 10 Reasons to invest in TUI Travel Plc. [online] Available from: http://www.ara2009tuitravelplc.com/tui-ar2009_ [Accessed 7 July 2012]
TUTOR2U, 2012. Ansoff Matrix. [online] Available from: http://tutor2u.net/business/strategy/ansoff_matrix.htm [Accessed 7 July 2012].
WALSH, P., 2005. Dealing with the uncertainties of environmental change by adding scenario planning to the strategy reformulation equation. Journal of Management Decision, 43 (1), pp.113-122.
BLANKE, J. and CHIESA, T., 2011. The travel and tourism competitiveness report 2011. [online]. Available from: http://www.scribd.com/doc/49473673/Travel-Tourism-Competitiveness-Report-2011[Assessed 6 July 2012].
Appendix 1: Ansoff Matrix
Market Penetration
Consolidation
New products and Services
Market Development
Diversification
COMPETITIVE RIVALRY
• The industry competitors
TUI Travel Plc
(Johnson et al 2011 p. 566-567) Thomas Cook
(Johnson et al 2011 p. 566-567) REWE Group
Number of customers
30 million customers representing a turn over of more than 16 billion in 2008 22.3 million customers Over 6.5 million customers (Lenz and Robson 2011)
Number of travel agencies
(2008 TUI own about 4000 travel agencies and 80 tour operation in 20 countries in Europe. 1000 travel outlets in Europe, North America and UK 2500 travel agencies (Finance 2012)
Number of countries’ operation 70 countries 21 countries 14 countries in Europe (Wikipedia 2012)
Number of employees 50,000 staff worldwide 31,000 employees Over 325,000 employees in trading and travel division (Wikipedia 2012)
Market share in Europe (2008) 18.6 % 13.9 % 5.1% (Johnson et al 2011 p. 566-567)
Revenues in Europe (2008) 15.6 bn euro 11.7 bn euro 4.3 bn euro
(Johnson et al 2011 p. 566-567)
