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EasyJet Holidays is in a strong position to capture growing demand

As tour operators fight to secure pent-up demand for holidays this summer, easyJet Holidays is in an enviable position compared with its competitors, particularly in the UK market,.

Many intermediaries have suffered reputational damage during the pandemic due to poor crisis management, financial instability and refund payment delays. 

EasyJet Holidays is still relatively young, having launched in April 2019. It will battle other popular tour operators such as TUI and Jet2Holidays, which have large stakes within the package holiday market. Due to the ongoing impact that the pandemic is having on its competitors, summer 2021 is a prime opportunity for easyJet Holidays to establish itself as a major competitor.

EasyJet Holidays faces challenges but it can compete

Like many other travel companies, it has been a difficult year for easyJet. Revenue was down 52.8% in 2020 year-over-year, with a net loss of $1.4bn.

In a more positive light, easyJet holidays reported a 250% increase in bookings in January 2021 compared with the previous year, which suggests signs of recovery. Furthermore, easyJet has a strong brand reputation for reliability, cost-effectiveness and accessibility through major and regional airports. These are all assets the company can utilise within the marketing campaigns.

EasyJet Holidays faces stiff competition from industry mainstays. TUI has a loyal customer base and has also confirmed a partnership with Booking Holdings, which will increase its power in the industry. Jet2holidays and Hays Travel have an excellent reputation for high-quality customer service and received positive press on their handling of the pandemic. 

If easyJet can transcend its reputation as a low-cost airline for its holiday services, it will have an excellent opportunity to capitalise on pent-up demand, particularly as tourists are much more price-conscious.

Competitors suffer reputational damage

Online travel agents have been under scrutiny during the Covid-19 pandemic, with some emerging with damaged reputations. Lastminute.com and On the Beach received heavy criticism for their handling of refunds, leaving many customers waiting for months to get their money back. This reputational damage will reduce their chances of repeat business, which will undoubtedly prolong recovery.

Fears that companies may not survive in the long term will spark concern over whether travellers should book with certain operators. Hays Travel, for example, announced that it was closing 89 stores in response to the pandemic, which is worrying for its customers. This may also be a deterrent for potential new customers. In the current climate, consumers require services they can rely on.

According to a GlobalData coronavirus consumer survey taken in December 2020, 84% of global respondents were either ‘somewhat’, ‘often’, or ‘always’ influenced by how risk-free a product or service feels. On the basis of this sentiment, easyJet Holidays may find itself in a promising position to break into the market with a reputable and familiar brand.

For more market data and analysis visit GlobalData's Travel & Tourism Intelligence Centre.