AKINYEMI: Today’s customer is the real king of a world of endless opportunities

Thursday October 3 2019

Pedestrians walk past a closed Thomas Cook travel agent shop in London on September 23, 2019.

Pedestrians walk past a closed Thomas Cook travel agent shop in London on September 23, 2019. Thomas Cook was unwilling to change their business model and they got deeper and deeper into debt leading to the company’s recent collapse. PHOTO | AFP 

WALE AKINYEMI
By WALE AKINYEMI
More by this Author

The year was 1891 and the Victorian era was bustling with prosperity. The industrial revolution had triggered an era where most people had a lot of disposable income.

An ex Baptist preacher saw an opportunity to spread the message of temperance and that was how the world’s largest tour company was born. Named after the ex-minister, Thomas Cook, the company pioneered package holidays and went on to become a beloved brand.

With 21,000 staff and a history spanning 178 years, this was the company that always led the way. They were pioneers right from their inception, yet on September 23, it all came crashing down. About 150,000 Britons were among the 600,000 who were stranded all over the world. The effort to get all the stranded British tourists back to their country was described as the largest repatriation of people since the Second World War.

The big question on the minds of many is, “What happened?”

TRAVEL PLAN

It is not that people are not travelling. In fact, people are now travelling more, but they were just not going the Thomas Cook way. The Stone Age did not end because the world ran out of stones. Thinking changed. A company that built a beloved brand on the foundation of “Don’t book it. Thomas Cook it” suddenly found itself in a place where people were no longer interested in “Thomas Cooking” it.

Advertisement

British taxpayers were left with a huge bill for bringing the 150,000 people back home. It was a tragedy. British tourists who had booked their holidays through Thomas Cook were not allowed to leave their hotels in many countries. Though they had paid Thomas Cook, the company had not paid the hotels and so the guests were made to literally pay a second time before they could be released. One guest described it as “humiliating to be treated like a prisoner when all we wanted was a holiday.”

Thomas Cook was a fixture on your typical British High street. They had 560 offices with paid staff in the UK alone. The sheer cost of running their operations was astronomical. This structure served its purpose in the 70s and 80s and some people thought that it could still survive.

People loved the brand but the company leadership soon discovered a very painful truth that brand love is not enough to protect a brand from irrelevance. People loved the brand but realised that they could now plan and book their holidays from wherever they were through their smart phones.

DYNAMICS CHANGE

We live in an era where people have choices. They do not need any one to plan a holiday for them as they can go online and identify locations and read reviews on platforms like Trip Advisor. They are able to search for the cheapest flights, hotels or even Airbnbs. Technology has given people power.

Thomas Cook was unwilling to change their business model and they got deeper and deeper into debt. They blamed everything from Brexit to the Heatwave of 2018. A company that had been birthed in innovation was now steeped in convention and as such the demise of the company was largely self-inflicted.

The company’s chief executive officer — the one who presided over the fall — had a string of apologies to offer in the immediate aftermath of the collapse.

This did not change the fact that while presiding over this epic fall he had made over £8 million and £3 million in bonuses. Boards need to be very keen in this era in their search for senior executives in companies.

An analogue chief executive trying to run an endangered company in a disrupted industry using pre-disruption dynamics will simply not work. As much as we would love to, the reality is that we cannot lead the way we were led. The dynamics are changing every single day.

The customer of today is vicious, unforgiving, promiscuous with their loyalty and has many options. They will love you but leave you and even when leaving you their love for you remains. Only an outdated leader will equate brand love as a mark of relevance. The flip side is that people can hate a brand and yet the brand will remain relevant and as such remain in business.

A company like Thomas Cook was a product of the prosperity of the industrial revolution and it fell to the ingenuity of the digital revolution. Relevance is no respecter of age, size, deep pockets, or titles.

Today, thousands of people have been rendered jobless, many more are in pain because the only world they knew was shattered. And now Thomas Cooks’ fleet of planes bid goodbye to the skies because well-educated leadership could not read the signs of the times.

Advertisement