During his 25 years in the business Ellis has covered a lot of ground: from product marketing to business strategy, and from CRM through data and brand, alongside group roles and time on international projects when the company was split after being acquired by parent TUI, and then re-merged about 18 months ago.
The vertically integrated business now sells 5.5 million holidays a year and has posted strong growth in what is a highly competitive market. Given the proliferation in holiday choices available to consumers today, CMO.com asked Ellis what his greatest challenge is.
Ellis: One of our biggest challenges is getting people to understand what we do and how we’re different. Holidays are an intangible product, they’re a difficult thing to explain.
I joined the company in the early ’90s when package holidays were price-led, then came the internet and with it the low-cost carriers with a different model and pricing structure, the bed banks, and online travel agents such as Expedia. These had a big impact on the business and we had to reposition ourselves. That’s where I’ve been putting my focus as marketing director for the past four to five years, in building the consumer-facing brands Thomson and First Choice.
There’s a lot more work to be done, we still have that historic label of package holidays, which come with a certain degree of scepticism that goes away when people go on our holidays.
CMO.com: How do you differentiate your two brands?
Ellis: Once I took the brand on, the first job was to look at the two to decide whether they could be differentiated, or whether to merge them into one. What became clear is that the all-inclusive market was growing massively. First Choice had 60% of its product as all-inclusive and this provided an opportunity to have a scaled brand with a singular proposition. We moved all of its product to all-inclusive, removed the First Choice brand from the high street and rebranded all the shops to Thomson.
Although the product range has shrunk, the brand has grown in terms of size and profitability. Brand awareness has gone down but that’s not a concern. We’ve made it more efficient with tighter targeting, better conversion, and clearer proposition: all-inclusive holidays with the benefit of not having to worry about your money. We started building brand stories around Carefree Indulgence two years ago.
Thomson, on the other hand, stands for differentiated concept hotels. We defined the proposition of “holidays designed around you” and landed on the benefit of “quality time.” It’s a really important value for people, so we started to build out stories around this in 2011 and continue that idea of getting back to your true self now in campaigns such as Simon the Ogre and Miles the Bear.
CMO.com: So storytelling clearly plays a big role in your communications. How do you approach that?
Ellis: We’ve made a concerted effort to move away from traditional holiday marketing around destinations and price, to switching to the benefits of the holiday. Holidays are a hugely emotive purchase that are critical to your annual expenditure, they should be the best two weeks of the year. Whilst we invest a huge amount into the product, we want people to understand that we understand how important that time is.
You need to tell people the benefits of engaging with your brand as well as the facts, but it’s the benefits that help them engage. Through film you can tell a really emotive story, into which people can put themselves and relate to them in their own lives. We worked with closer camera angles to create more intimacy and give the feeling of being in the picture. That’s how we’ve tried to shift our advertising strategy.
We also use a three-tier level we call “heart, head, and hands”: “heart” is emotional storytelling, the rational piece and reasons to believe are “head,” and “hand” is the typical direct response activity. We categorise all our marketing from broadcast through to PPC through those three categories.
CMO.com: And how do you view the role of content within that?
Ellis: Traditionally, content has been focused on brochure production, but that’s in decline, so our content strategy is firstly how you bring to life your intangible products. Content is the only thing that can make it semi-tangible, and that’s why we’re using more 360-degree imagery in video and more drone-like camera photography, which gives you a more immersive picture.
Secondly, it’s about moving our brand content into more storytelling focus. And, thirdly, I think content can play a strong role in how we start to create a regular conversation with customers. We have an infrequent purchase, it’s just one holiday a year for most people, so how do we make sure people are engaged with us as a brand between one purchase and another? Content and using digital channels give us routes to customers that allow us to speak to them on a more frequent basis and in a more personal way. Content is critical for that.
CMO.com: What does digital mean in the business and for your marketing strategy?
Ellis: We’re looking at how digital can help the customer experience. As a business that is essentially a service organisation, we want to blend digital with our human touch. We’re looking at how we integrate this in everything, whether from a communications’ or customer experience point of view.
It’s all starting to blend. For example, our app started off as an assistant to service your holiday but can now be used to browse and book. What’s critical from a digital perspective is that in future this will allow us to have a much closer and regular relationship with the consumer. I think of digital as the data and technology that allow you to build a much closer relationship with your customer.
In future, I think almost all advertising will be programmatic—TV’s not far off, some of outdoor is already programmatic, and it’s growing on the internet. It will all become digitally led.
For me digital means personalisation. What does digital enable that allows me to be more precise when engaging with consumers, to a point where I can create an experience completely relevant to them, whether that’s serving them an ad on TV, or building a regular conversation through CRM, or a personalised app? And how does it help me to understand the best next-step action, which is most relevant for customers and of most benefit to us?
CMO.com: How far down the road are you to personalisation of the type you describe?
Ellis: We have reasonable personalisation in our CRM—so much of what we present is personalised. The next best-actions work is still manual to a degree. We’ve identified and segmented various customers where we believe we’re ready for particular offers or service initiatives. And we’ve been using that data in outbound telemarketing, in destinations, and in retail. Even at that manual level, we’ve seen a massive uplift in conversion. We’re looking at how we take that into an automated world and start to provide these types of recommendations at all other customer touch points, whether that’s frontline staff or direct to customers.
It’s a journey at the moment and will transform how we interact with customers in the future.
CMO.com: How have you changed your internal marketing restructures and how you partner with agencies?
Ellis: In a world of storytelling, a lot of the teams in my area (brand, CRM, and customer experience; digital, content, and publishing; social and SEO; and PR) are starting to merge in some form or other. It’s the same with agencies.
On the one hand, it would be good to have one agency, but there’s no agency out there brilliant at everything. On the other, it’s difficult to manage a set of agencies with specialisms but which all want to grow their capabilities.
To me the future is setting up a matrix organisation, where you have clear ownership at brand level but with specialists that make sure you’re getting maximum performance in those specialist functions.
CMO.com: What things most concern you in marketing?
Ellis: Being able to measure the end-to-end effectiveness of marketing and understand in a digital age where I should spend my next pound. One of the biggest challenges as marketers in a fragmented world is how to measure it collectively.
All marketers always want to spend more money because we believe we play a critical role in business growth. A robust holistic effectiveness model is the Holy Grail.