Thomas Cook Collapse Could Hit Vulnerable Customers Hardest

Author: Siobhan Kelly

 

The collapse of the oldest travel company in the world, Thomas Cook, has been one of the biggest and most tragic business disasters in recent years. Overnight, 21,000 employees learned that their employer was insolvent - 9,000 of them right here in the UK. Over 150,000 British customers (600,000 globally) are away on holiday and need to be repatriated from 50 different countries by the Civil Aviation Authority (CAA).

 

The Thomas Cook collapse is shocking because it was so sudden – the company did not even have enough cash to pay for an administration process, where they might find different parts of the business that could be kept going. So many employees are affected and so many customers are now facing a difficult journey home. Thousands of customers have already been brought back to the UK only to find they are at the wrong end of the country and need additional flights to get home.

 

But in all the media coverage I have seen very little focus on how vulnerable customers may have been affected by this corporate collapse more than most. Customers that are elderly or with special needs are far more likely to go to a trusted travel company such as Thomas Cook, rather than booking their travel independently, because they can be assured that their additional needs can be accommodated during their holiday.

 

What’s even worse is that fraudsters have already been contacting Thomas Cook customers, claiming to be from the company and offering to arrange a refund for their booked holiday. Naturally the “refund” requires that the customer hand over all their personal financial details so the cash can be transferred to them.

 

It’s shocking to read about this type of greed and criminal activity and it will directly impact the vulnerable customers most acutely. If you have saved for a year or more for that holiday and then hear from the news channels that your money is probably lost, it might come as a relief to get a call claiming to be Thomas Cook processing your refund. It’s easy to see why people trust these fraudsters.

 

There has been a lot of media analysis about why the company collapsed and one theory is that the package holiday is dead. I’d argue that Thomas Cook just didn’t keep up with the way that package holidays have evolved, because brands like Jet2holidays and TUI seem to be doing fine and they are in a very similar business.

 

Thomas Cook did inspire loyalty from some customers. People would return year after year because it was a familiar brand with over 500 travel agent stores on the High Street, but that loyalty must have been tested as the brand failed to evolve the product offering. Ultimately in the present-day travel market a company needs to be placing the customer at the heart of their business strategy and this might mean tearing up products that have been sold for years – I can’t see any evidence that Thomas Cook ever considered how to be more customer-centric.

 

That attitude to customer loyalty just will not work today. Brands like Expedia and Travelocity have been around for two decades and they are actively exploring ways to get closer to their customer by mining customer behaviour data – offering a dramatically more personalised travel experience than any travel agent in a shopping centre could manage. It’s a real shame to watch this iconic British brand disappear. I just hope that someone at the CAA or UK government starts doing more to protect the customers who don’t need repatriation, but do still need help working out what to do about their holiday.