Advertising spending by travel companies was £406.8 million in 2010
In 2010 the amount spent by the travel sector (not only air travel) was £406.8 million, while the amount spent by comparison for retail was £1,529.4 million. In 2010 British Airways spent £12.4 million; TUI spent £11.3 million; Thomson Holidays spent £10.1 million on ads; Thomas Cook Travel Shops spent £7.8 million; Virgin Travel Group £ 7.6 million; easyJet spent £7.2 million; Flybe spent £5.9 million. Total UK advertising spend was about £16.6 billion in 2010.
There is lots more detail at http://www.bradtop100.co.uk/08-Travel/
Total UK advertising spend in 2010 was valued at £16.6 billion (link) with about a quarter on the internet.
Travel sector advertising spending
TOTAL SPEND 2010
|Top 10 advertisers||£107,065,706|
|Sector (Other Advertisers)||£299,773,428|
TOP 10 ADVERTISERS 2010
|1) Reader Offers Ltd||£17,908,547|
|2) Carnival UK||£14,887,556|
|3) Thomas Cook Group Plc||£13,037,446|
|4) British Airways||£12,350,389|
|5) TUI Travel Plc||£11,303,541|
|6) Bourne Leisure Group Ltd||£8,200,573|
|7) Virgin Holidays Ltd||£7,597,958|
|8) InterContinental Hotels Group Ltd||£7,570,888|
|9) easyJet Plc||£7,227,021|
|10) Great Rail Journeys Ltd||£6,974,315|
TOP 10 BRANDS 2010
|Reader Offers Cruises||£17,908,547|
|Thomas Cook Travel Shops||£7,842,456|
|Great Rail Journeys Rail Holidays||£5,735,551|
CONSUMER PROFILE 2010
Target group: Frequent flyers
- There are currently one million adults in Britain who have flown at least seven times in the last year – 2% of all British adults
- Frequent flyers are over five times as likely as the average adult to have a family income of at least £75k.
- A quarter always watch the in-flight TV entertainment and read the in-flight magazine
- Frequent flyers are 43% more likely than the average adult to have an ISA.
- They are over twice as likely as the average adult to regularly arrange their holidays online.
- Frequent flyers are 34% more likely than the average adult to listen to at least 28 hours of radio every week.
Data supplied by TGI
By Ian Taylor, Executive Editor, Travel Weekly
Ian Taylor from Travel Weekly looks at the travel sector’s turbulent 2010, identifies which travel operators braved the adverse conditions best, and points to where the sector is heading in 2011
The UK travel industry experienced a roller-coaster ride in 2010, with the ups just about compensating for the downs. Given a 15% contraction in overseas holidays in 2009, this was an achievement. But challenges remain.
Severe winter weather in January and December hit departures. Volcanic ash shut UK air space for six days in April, and travel company failures in July and August affected around 200,000 consumers. The latter led the government to propose extending consumer protection beyond traditional tour operators to online and high-street retailers – a process now underway.
British Airways withstood 22 days of strikes by cabin crew, revealed a record annual loss for 2009-10 and saw the incoming Government scrap plans for a third Heathrow runway. The carrier also completed a merger with Iberia, launched a transatlantic partnership with American Airlines and is set to return a profit for 2010-11.
Thomas Cook and The Co-operative Travel agreed a high-street merger that, pending approval, will create a chain of 1,300 travel agencies while easyJet established a holiday arm – launched in March 2011 – that it believes will put it among the top three UK operators.
The biggest UK holiday company, Tui Travel, consistently outperformed the market despite revealing a hole in its accounts and learning it must wait till 2012 for delivery of its first Boeing 787 Dreamliner. Meanwhile, an engine failure on a Qantas Airbus A380 saw a portion of the world’s super-jumbo fleet temporarily grounded, but thankfully no injuries.
The year ended with the industry lobbying hard against fresh rises in Air Passenger Duty – the tax on flying that adds £75 to an economy fare to the Caribbean.
This year’s outlook will depend on how a troubled UK economy, declining consumer confidence, a high oil price and world events pan out.
Ad Spend Profile
The travel sector as a whole invested £406.8m into advertising in 2010, of which a quarter, £107.1m, was contributed by the top ten advertisers. The sector pushed the largest proportion of spend, £124.8m, into the first quarter last year, decreasing the investment during the year to reach £81.2m in the final three months, mirroring the previous year.
Press held its status as the most popular medium last year, increasing its share by 9% on the year to take almost half of the top ten’s total spend. The total outlay also grew, jumping £10.6m to £52m. Top spender Reader Offers accounted for almost a third of this figure, pushing £16m into the medium.
After press, TV garnered a quarter of the spend, with expenditure in the medium increasing £2.2m on the year to £25.4m, helped by spends of more than £4m from Thomas Cook and Bourne Leisure Group and over £7.1m from TUI Travel.
Direct mail and radio remained steady on the year at £15.2m and £3.5m respectively. Carnival accounted for almost a third of direct mail’s figure and was one of only three advertisers to spend more than half a million pounds on radio, along with easyJet and InterContinental Hotels Group.
The top ten’s cinema and outdoor spend halved on the year to £491k and £6m respectively. Only Thomas Cook and Bourne Leisure invested in cinema, while easyJet and British Airways collectively contributed 81% of outdoor’s total.
Internet’s spend share dropped 2% on the year to 4%, and its investment sunk by £2m to £4.5m. Top spender Reader Offers spent nothing on this medium, while only British Airways and Carnival pushed more than £1m into the area.
by comparison total Retail advertising spending was
TOTAL SPEND 2010
|Top 10 advertisers||£776,758,028|
|Sector (Other Advertisers)||£752,721,635|
TOP 10 ADVERTISERS 2010
|1) Tesco Stores Ltd||£132,134,273|
|2) Asda Stores Ltd||£110,304,087|
|3) DFS Furniture Company Ltd||£90,427,089|
|4) Sainsbury’s Supermarkets Ltd||£73,151,630|
|5) William Morrison Supermarkets Plc||£70,172,446|
|6) Marks & Spencer Group Plc||£68,548,522|
|7) Argos Ltd||£64,836,063|
|8) DSG Retail Ltd||£56,031,005|
|9) Boots UK Ltd||£55,859,722|
|10) B&Q Plc||£55,961,189|
and the Automotive sector advertising spending
TOTAL SPEND 2010
|Top 10 advertisers||£341,339,077|
|Sector (Other Advertisers)||£205,584,537|
TOP 10 ADVERTISERS 2010
|1) Volkswagen Group (UK) Ltd||£73,534,699|
|2) Vauxhall Motors||£46,190,943|
|3) Renault UK Ltd||£34,038,981|
|4) Ford Motor Company Ltd||£33,430,109|
|5) Fiat Group Automobiles UK Ltd||£28,338,463|
|6) Peugeot Motor Company Plc||£26,739,601|
|7) Toyota (GB) Plc||£26,336,510|
|8) Citroen UK Ltd||£25,162,041|
|9) Nissan Motor (GB) Ltd||£24,143,165|
|10) BMW (UK) Ltd||£22,860,033|
British Airways Ad spending in 2010
The amount that British Airways spent on advertising in 2010 saw a year-on-year fall for the fourth year in a row. The sector’s top spender for the past two years, BA was only the fourth-top spender in 2010 with a total of £12.4m, down £4.8m on the year.
The company’s marketing expenditure has fallen by two thirds since 2005, with a staggering £9.2m less spent on TV, £6.6m on outdoor and £5.3m on radio. The only medium to receive more investment in 2010 was direct mail, with an above-sector average spend of £1.9m.
Press garnered the focus of BA’s advertising in 2010 with £5.5m, 44% of the budget, which included a campaign thanking the staff who worked during the five-day cabin crew strike in June. At 20% and 15% respectively, outdoor and direct mail both received a large proportion of BA’s budget.
The whole of the £1.1m TV spend occurred in the first quarter, as did 77% of the £260k radio spend, though BA generally spread its budget evenly throughout the year. Like many in the travel industry, the airline chose not to invest in cinema once again.
BA spent 8.9% of its budget on internet in 2010, proportionally more than any competitor and more than it has for the last five years. The £1.1m spent on internet was widely distributed, including an online campaign to promote the relaunch of its BA First cabins in February and a social media activity to combat negative PR about industrial action in the spring.
Parent British Airways
Total company spend 2010 £12.4m
Top spending brand 2010
British Airways Passenger Services £4.3m
EasyJet’s Ad spending in 2010
Easyet has fallen from fourth to ninth in the rankings following a total ad spend of £7.2m in 2010. The company lowered its budget for the fourth consecutive year, shrinking its expenditure by £2.6m on the year.
The company invested £3.1m of its budget on press advertising, corresponding to 43% of its total spend. Throughout 2010 the company engaged in a negative print ad battle with budget rival Ryanair. In March, EasyJet had an ad banned for implying that Ryanair does not fly passengers to destinations it claims to, before Ryanair issued an apology in the Guardian to EasyJet founder Stelios Hajj-Ioannou in July following an ad that labelled Easyjet ‘Mr Late Again’.
The airline’s second choice of medium was outdoor, with an outlay of £2.4m, the second highest amount in the travel sector. Spending on outdoor reached its zenith in the second quarter with a £929k spend, before plummeting to £106k in the third quarter.
EasyJet spent more than double the sector average on radio, investing £848k into the medium. Contrastingly, the company spent £254k on TV, all in the last six months, which was £2.6m below the sector average.
Internet accounted for 9% of the company’s total budget in 2010, up from £118k in 2005. However, the £636k investment was still a £1.1m drop from its peak in 2009. Traditionally one of the highest online investors of the travel sector, the substantial decrease suggests that the advertiser has its doubts about the medium.
Parent easyJet Plc
Total company spend 2010 £7.2m
Top spending brand 2010 easyJet Airline £6.6m
Virgin Holidays Ad spending in 2010
Virgin Holidays storms into the travel industry’s top ten ad spenders with its budget increasing by £2m on the year. The company’s £7.6m ad expenditure in 2010 was its highest in the last five years, increasing in every medium except cinema, which still receives no investment.
The travel company allocates 80% of its budget to press and TV, with TV the medium of choice. TV received a total of £3.2m and £2.9m went to press, although investment in both categories dipped towards the end of the year, as spending on TV in the fourth quarter fell to £180k.
Virgin’s ad spend decreased in the second half of the year. The last quarter in particular saw a fall in investment with the total amount of £710k, £2.1m less than the second quarter.
The rest of the business’ budget was distributed similarly between radio, outdoor, direct mail and online activity, which received £440k, £400k, £350k and £300k respectively. Virgin’s ‘Rockstar Service’ campaign, an extension of its ‘ask for the world’ strategy, ran across a number of mediums spanning TV, press, online, radio and outdoor. In September a poster for the campaign was banned by the ASA for glamourising alcohol.
Virgin spent £290k on internet activity in 2010, which was up £70k year on year. Although online spend has increased two years in a row, it has fallen from its peak in 2006 and 2007, where it accounted for up to 14% of expenditure and totalled up to £560k.
Parent Virgin Travel Group Ltd
Total company spend 2010 £7.6m
Top spending brand 2010 Virgin Holidays £6.7m
TUI Travel Ad spending in 2010
TUI saw a 26% increase in its ad budget year on year in 2010, climbing from £9m to £11.3m. The tour operator’s ad spend was slashed from £19.5m in 2007 to £7.2m in 2008 and has gradually improved since then.
The German company’s expenditure steadily declined throughout the year with TV receiving £2.3m more in the first quarter than the last and 79% of the company’s press spend coming in the first six months of the year.
The travel company has reassessed its advertising priorities over the last five years, with TV replacing press as the prominent medium. TV took £7.1m in 2010, an impressive 63% of TUI’s expenditure. TUI used TV when launching a campaign in December to rebrand Thompsons as a tour operator able to give families their perfect tailored holiday with its ‘your holiday to a T’ ad.
Press activity garnered £2.4m in 2010, a £4.8m drop since 2005. Direct mail was the only other medium that TUI invested in heavily, receiving £1.1m, 10% of the total spend. Radio received £480k, corresponding to 4% of the budget, though the company has already launched a prominent radio campaign in 2011, suggesting that the medium will see a greater investment this year.
One surprising result was the 0.05% allocated to online advertising. Having spent £3.5m on the medium in 2007 and 27% of its expenditure in 2008, the £6k that TUI spent in 2010 suggests that it believes investment elsewhere will yield greater dividends.
Parent TUI AG
Total company spend 2010 £11.3m
Top spending brand 2010 Thomson Holidays £10.1m