Tourico Holidays - the global travel brokerage company - are predicting a 40% boom for UK destinations now the effects of Brexit are in full swing.
One of the big winners of the UK's vote to leave the European Union in the June 23rd referndum appears to be the tourism industry.
The fall in the Pound has made the UK a cheaper destination to visit. A surge in visitor numbers has been recently confirmed by trade association UKinbound who say confidence levels among the UK’s hospitality and tourism businesses are at a 12-month high.
“What we've previously seen is that London wasn't affordable on a global level, there was no real lower scale in terms of price. But in the past year a lot more affordable properties have come on to the market, and with the decrease in Sterling we now see that London is very much open for business and affordable,” says Mark Redmond, the Vice-President for the European Region of Tourico Holidays.
Trading in recent weeks have been the strongest in history for the UK arm of the company.
Utilising their unique IT system, which maps the difference between search terms and booking, the company is predicting a boom in London bookings following Brexit which could potentially rival that of New York.
Tourico was first started independently in 1995 but has grown to become a business that is now worth over a billion dollars (1.2billion in 2015).
Originally US based, global expansion then happened, most aggressively in to Europe, the Middle East and Africa after they opened their London office seven years ago.
Redmond has been there since the start and has seen that lately, by using the recent influx of inventory as an opportunity, the team have openly focussed on the UK in recent months; capitalising where they can on Brexit and changing currency markets. “Arguably we have the most sophisticated technology in the business,” says Redmond.
The firm utilises an earlier company investment in an Israeli technology firm to pair the latest up-to-date technology with a human counterpart.
“If people are looking for 3* accommodation in Bayswater for £100 a night then that is what my team will buy. Right now we're getting double the number of searches for London then we are with New York, but New York is converting that in to bookings,” says Redmond.
Tourico believe with the current exchange rate, their ability to buy more affordable stock and with their extensive overseas client base, they will be looking at a 41% jump in hotel stays in London within the next year.
This is up further from their 30% prediction that we released after the EU referendum.
The Pound has fallen to its lowest levels since 1990 on a trade-weighted basis in 2016 which means the UK has suddenly become a cheaper destination for those earning foreign exchange.
Redmond is preparing for his handpicked UK team to outstrip the US in terms of sales fairly quickly.
In part due to the opportunities of his software and the team he has built around him, doubling in the past 18-months alone.
“As a company right now we are very, very strong. Our partners include American Airlines and various car hire firms which allow us to offer the full package of an accessible and good value holiday destination. Our motto is connecting dreams to destinations and we absolutely do that, our bases across the world allow us find hotels our customers can't," says Redmond.
UK Citizens Will Keep Travelling, Despite Weaker Pound
But Redmond thinks there may be a downside to Brexit for his counterparts overseas.
He says, “My only slight concern with Brexit is the UK travellers, if the economy takes a significant hit, then we could see that UK travel in to the US effected. Brexit is a huge opportunity for London but people who are based in the UK may not have the disposable income to go to New York if the economy changes very fast.
“It’s incredibly difficult to predict but historically, looking at downturns in economy, people still travel.”
Redmond points to the company’s success during the 2007 downturn in which people still managed to find the disposable income to take a trip.
Even in 2007, the biggest global downturn, Tourico still grew significantly as a company that year.
“If people continue to travel then we will continue to enable them. After all, we buy direct based on what people are searching for and are willing to spend. If that means rates in New York need to be lower than that is what we will adapt to,” says Redmond.
The UK’s Tourico team is now 70-people strong and growing, and with technology allowing the firm to track not just hotel nights but flights, car hire and even money spent dining in a hotel.
“My job is to make Europe the biggest contributor to the company globally. Surpassing North America eventually and I think we’ve got the talent here in the team to do that,” says Redmond.