Monitor de Mercados: Visión de un Key player

TUI Travel PLC The new scenario in Tourism through the eyes of the market leader Ian Livesey Head of Specialist TUI Travel plc A&D, Spain & Andorra

Contents 1. TUI Travel, TUI AG & TUI Travel A&D 2. The new scenario in tourism 3. The impact of the new environment for TUI Germany 4. TUI´s strategy: Differentiation by adding value

1. TUI Travel, TUI AG & TUI Travel A&D

TUI Travel, TUI AG & TUI España Creation of TUI Travel plc First Choice TUI AG Holidays PLC TUI Travel PLC

TUI Travel, TUI AG & TUI España TUI Travel plc in numbers • Market leader in tourism on an international level • Presence in 180 countries worldwide • 20 outbound markets • More than 30 million customers • Fleet of 156 planes • 3500 points of sale in Europe • 48.000 employees • 200 brands • Turnover of 18.764 mio. € in 2007 • Results (EBITA): 419 mio. € in 2007

TUI Travel, TUI AG & TUI España TUI Travel plc in numbers Travel Tour Destinatio Aircrafts Hotels Agencies Operators n Services Approx. More than 156 aircrafts More than 237 hotels 3,500 travel 200 brands 20 incoming with agencies and products agencies 144,000 with 30 mio. beds clients

TUI Travel, TUI AG & TUI España avelling with TUI – from the travel planning to the return Arrival Return Home Travel Before Holiday Agent Flight Brochure Check in Booking Airport Travel Document s Excursion s Airport Hotel Check in Transfer Arrival in Flight In Destination Destination Arrival Journey

TUI Travel, TUI AG & TUI España UI España is the Nº1 Incoming Agency in Spain Our BUSINESS OUR business Incoming Incoming 207 M€ 207 M€ 800 emp 800 emp Transport TRANSPORT 42 M€ 42 M€ 390 emp 390 emp MICE MICE 21 M€ 31 M€ 10575 emp emp 20 offices 205 vehicles 150 service points 320 guides in high season Costa Brava Costa Dorada 2.000.000 excursions sold Costa de la Costa Blanca 1.200 events organised Luz Islas Costa Baleares del Sol Costa Almería Islas Canarias …nearly 5 million customers in 2008

2. The new tourism environment

The New Tourist Environment Factors Spain is a mature market and a safe destination. • Expert and repeater clients Entry of new competitors in the market • Opening of new destinations Incorporation of new technologies in all parts of the touristic value chain. • Incorporation of low cost airlines • Increased price transparency for the customer • Increased autonomy for the customer in the organization of the trip

The New Tourist Environment Factors Changes in the customers´needs • Preference for a more differentiated product • Cost and quality as two factors for the purchase decision Reduction of the average stay • More trips, shorter stays and less average spending Financial and economic crisis worldwide • Climate of mistrust • Increase of fuel prices Lack of talent in the labour market.

The New Tourist Environment Factors WELL INFORMED customers SATISFIED customers But FEW SURPRISED

The New Tourist Environment Factors A CHANGE… FROM A SELLERS MARKET… TO A BUYERS MARKET

3. The impact of the new environment for the touroperator TUI Germany

segments with its differents brands Main brand Volume market, quality-orientated with highest volume Premium Market Volume market, attractive pricelevel Last-minute market, direct sales Specialist market (roundtrips)

In the past, the intermediate segment represented the most important volume of the market Market volume Principal market of TUI Economic Quality Exclusi Price ve Low Medium High

In the new environment, the market is undergoing a polarization Market volume Principal market of TUI Collapse of the intermediate segment Price-orientated Specialist segment segment Price Low Medium High

The demand is getting more and more individualised - Yesterday - - Today - - Tomorrow - Mass Demand “Cluster“ Individualization

Some brands have already adapted their strategy successfully

Standard products no longer fulfill the new market requirements Differentiation is the key.

4. The strategy of TUI: Differentiation by adding value

The strategy of TUI is based on four pillars • “Multichannel approach” with special Strategic approaches: importance of the internet • Specialisation: “Target groups” • Own and exclusive products • Fidelization of the customers by a complete offer, including services with added value

Multichannel distribution: The distribution of TUI is based on three channels Travel Agencies Internet Callcenter TUI Leisure Travel TUI Interactive TUI 4 U 980 franchise www.tui.com Callcenter in Bremen, agencies www.tui-hotels.com Germany 440 branch www.1-2-fly.com agencies www.discount- travel.com ...

Differentiation by target groups: from a mass-market product to an individualised product yesterday today Classic touristic package Different product lines with TUI holiday, brand, TUI brochures for different classic holiday package and destinations modular products (components)

Differentiacion by target groups: different product lines for different target groups TUI Schöne TUI Schöne Ferien Ferien Family Classic package Families holiday and hotel only TUI Premium TUI Schöne Ferien Exclusive segment Clubs (luxury -> airtours) Club hotels for families and couples

Own exclusive products: The brand Sensimar Hotels was launched in summer 2009 • Target group: medium-age couples • Hotels with reduced volume (max. 250 rooms), always situated in seafront • 4 – 5 stars • “Comfort & Convenience” • Personalized and individualized service • 100% orientated to the needs of the German market • Reservations exclusively via TUI • As of summer 2009, the first 3 hotels in Greece and Turkey

Differentiation of services by adding value: Quality campaign of TUIfly in January 2008 Promotional campaign highlighting the service level “You are not flying with a plane. You fly with us. Welcome on board.”

Differentiation of services by adding value: Examples for additional services for TUI customers Assistance by German-speaking reps in all destinations, 24/7 service telephone System for complaints handing in the destination, if the complaint cannot be settled -> compensation directly in the destination Publication of guest satisfaction with hotel according to CSQ in the brochure (hotel in general, service, facilities, food) “Zug zum Flug” (train to the plane) all holiday packages include a first class train ticket to the departure airport (and return)

Differentiation of services by adding value: Promotional campaign with German national team coach Slogan: “Holidays with TUI – you deserve it.” Message: TUI treats all customers like VIPs.

The future… Reflexiones...

In the new touristic model: the main growth potential are the product areas Previous model New model Demand Demand Distribution Distributio n Tour Operator Tour Flight Operator Dest. services Destination Flight services Hotels Hotels Previously: In the future: The distribution and the tour operators All parts of the touristic value chain will were the growth drivers. become growth drivers.

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Monitor de Mercados: Visión de un Key player

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Monitor de Mercados: Visión de un Key player Presentation Transcript