Helloworld, where have you been? Australia’s newest travel retail network has just launched a five-week integrated campaign covering “a vast range of marketing activity – press, billboards. TV commercials, search engine marketing, digital and social media.”
And you’d have to say it’s been due. It’s the first widespread marketing the chain has done since a burst in early December last year and some of the natives – member agents – have been getting restless.
Two months without noise – that’s a long time for a major new travel brand to lie low.
Especially when the main opposition – Flight Centre – never rests, marketing 24/7, filling the vacuum with their brands and deals.
Major suppliers such as airlines, cruise companies and tour operators are also relentlessly active.
Travel is a perishable commodity. An unsold hotel bed or aircraft seat is gone forever.
So branding and marketing is the name of the game.
It’s also the primary reason that Helloworld exists.
Management consultants Boston Consulting Group last year recommended to the Jetset Travelworld Group, as Hellworld was then known, that a single brand replace its Harvey World Travel, Jetset Travel, Travelworld and Travelscene American Express properties.
JTG bought into the vision and Helloworld is the result.
The aim was to focus the JTG marketing spend, previously spread across four brands.
This sound logic met with general industry agreement and was embraced by the company’s stakeholders, with a good percentage signing up to Helloworld.
But while there has been progress on that front, the benefits of a bigger marketing budget are yet to be seen.
There’s been a lack of activity over the past couple of months and questions over what happens after this five-week burst.
More mainstream silence?
Perhaps the unfortunate reality is that, even after the brand and budget consolidation, Helloworld doesn’t have the money to compete with Flight Centre.
In its 2012/13 annual report, Flight Centre revealed it spent AUD137 million on sales and marketing, which EGM Global Marketing, Colin Bowman, said would increase this financial year.
Total operating expenses for the entire JTG retail network in 2012/13 were AUD115.4 million – AUD21.6 million less Flight Centre spent on marketing alone.
JTG didn’t break out its marketing expenditure at that time, and senior Helloworld management are making no comment now.
In response to questions on the topic, the company today put out an obtuse two-sentence statement saying there are now 650 Helloworld stores and “we are progressing well”.
This contradicts an announcement the company made on Dec 23, 2013, headlined “Helloworld reaches more than 720 locations”.
Where are they at – 650 or 720? Still waiting for an answer on that one.
Given that lack of clarity, and willingness to engage, the only option left is to speculate.
Here’s one hypothesis: Helloworld can only afford strategic bursts rather than regular mainstream activity because the brand implementation, costed at between AUD35 million to AUD40 million, is chewing up all the cash.
If that’s the case, then quite a few stakeholders are going to be unhappy.
They bought the vision which is about building a sexy new brand, communicating that to the travelling public and selling them awesome travel deals.
You do that through relentless mainstream marketing.
Switching it on and off, as appears to be the case now, has never been an option for successful travel retailers.