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Thomas Cook and how not to go digital.

Sat by a pool in the sunshine waiting to hear about how I’ll get home now Thomas Cook have gone bust, I am reading the news and scrolling through Twitter hashtags thinking about how many companies have stumbled and fallen with the rise of the internet of now. 

One of the main causes being attributed to Thomas Cooks’ demise is there inability to adapt to the digital era. With more and more people choosing to book their holidays online from the comfort of their sofa, Thomas Cook kept investing in their travel agencies made of bricks and mortar. 

Thomas Cook website as of 25th September 2019

My personal experience of the app and website were clunky and unwieldy on mobiles, an instant off putter for me. We have reached a point in time where website need to be mobile and tablet focused more than they need to be working on laptops and traditional computer screens. In fact 2015 is when Thomas Cook themselves acknowledged that they had more traffic from mobile devices than traditional computers.  It only takes a quick look at the App Store ratings for the app against its competitors to see it had issues.

In my local, struggling, shopping centre, amongst the Poundland’s and charity shops, there was still a large Thomas Cook travel agency, but very rarely did you see anyone in there. The people inside were always lovely but sadly that can’t compete against people’s 21st century lives where finding time (during standard retail hours) to spend sat in a store to book their holiday was depleting. In the modern world of comparison sites, last minute deal websites and apps; Thomas Cooks high street store model just didn’t fit. 

When Thomas Cook online was launched in 2010 it was one of the first travel companies to do so. So why did it go so wrong? What did they miss?Having been involved in a lot of business and digital transformation programmes over the last decade, there are answers there if you dig.

This article  by @iankingsky, business correspondent at Sky News, describes the decisions made by one of the CEOs a few years ago to keep investing in their physical architecture over their digital one as part of the companies end. Citing particularly the take over of MyTravel (air tours) in 2007 and the Coop travel merger in 2010 which added to their physical portfolio while consumers were turning towards digital outlets.

It was only in 2015 that Thomas Cook gained a CDO, and by that point the company was already beginning to show signs of struggling. A struggle that they sadly could never overcome.

To me, and I’m sure many others, this is a clear example of a lack of vision from the top, and of a strategy and vision that has failed to iterate and been left to stagnate rather than adapt with the times. 

The sides of the roads on the way to the On demand era are littered with the remains of business who have failed to learn from the mistakes of those who have gone before. 

Blockbusters is often used as one of the first casualties of the new digital era, many people lay that blame at its CEO’s feet, but that is a very simple summation of a more complex problem. As Greg Satell in Forbes says, for Blockbusters to have survived it would have had to change it’s very business model, and that was where it struggled. It’s not that its CEO simply didn’t have a vision that included digital, it’s that the company didn’t know how to transform its very foundations. 

Blockbuster website November 29th 2010

In my experience this is where most companies struggle, they want to adapt to the digital era, and so they build a digital front end, as Thomas Cook did, but they don’t realise that digital is more than just a shiny front end. To ‘be Digital’ you have to change from the inside out, your commercials, your finances, your governance structures. Changes to the very culture of the business.

This holistic understanding is key at all levels of the organisation, from the people delivering customer services to the Chief Excs and Directors. To be digital requires breaking down organisational silos and for all the different departments in an organisation to work together to deliver a vision of what is possible. 

This is where the CEO is responsible, for ensuring that vision is agreed, and that they have the right team in place, at all levels through the organisation, to deliver it. 

A good Chief Digital Officer (or someone with similar skills and experience if not the title) is a critical appointment in this time, because they understand the art of the possible and how to deliver it. It took 5 years for Thomas Cook to appoint that person after it began Thomas Cook online. In any business that 5 years can be an eternity, especially one that relies on consumers in a competitive market. In that time their competitors has outstripped them, changed their business models, transformed their offering to meet user expectations. 

The lesson here is that digital is not something you can pay lip service to, you have to understand it and how to ‘be’ it. Without that vision and willingness to iterate and change, you will find your users will move on to somewhere else that can meet their needs better. 

The ripples of Thomas Cooks fall will be felt for a long time yet, not only in the thousands of holiday makers like myself who are inconvenienced by this, but also the staff who are now out of work and for whom this is a time of heart break and uncertainties. Many other companies around the world relied on Thomas Cook for business, and their futures too are now uncertain.

There is a lot we can learn from this, to ensure this is not a bit of history doomed to repeat itself. Again.

1 thought on “Thomas Cook and how not to go digital.

  1. Hi Zoe,

    I think you’ve got that spot on.

    I’m also not a fan of their Lyk app – for currency exchange. It quite simply doesn’t work. Real shame.

    Leadership paying lip service to digital is tragic.

    I’ve been really impressed by large scale public services managing to grasp the points you made and getting it largely right for years now. We can’t get arrogant or complacent about it though, as there’s so much more we could do…faster!

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