European tour operating veteran Thomas Cook Group has formed a strategic alliance with Expedia Inc and will use the online giant's platform to power its city break and hotel-only business across its European points of sale.
In Thomas Cook-speak, the tie-up relates to its "complementary" city and domestic holiday business, leaving it to concentrate attention and resources on its "core" product which is "holidays to [its] own-brand and selected partner hotels in sun and beach locations".
The announcement also says that Expedia Inc technology will "deliver bookings for city and domestic hotels, either on their own or as part of a city break dynamic package, through Thomas Cook’s primary websites, contact centres, stores and distribution to affiliated travel agents."
Expedia Inc hotel inventory will also be made available through Thomas Cook's channels, effectively adding another 60,000 properties to those currently available. Thomas Cook says the new hotels will meet all health and safety requirements.
Another part of the alliance is "an option" for Thomas Cook's pre-packaged holidays and its Thomas Cook-branded hotels to be sold via Expedia's points of sale in Europe.
A Thomas Cook spokesperson explained that it had "effectively outsourced" its non-core hotel and packaging business through the white-label deal.
Expedia Inc is a "preferred" supplier rather than an exclusive one, following Thomas Cook's 2016 deal with Australia's Webjet. One of Webjet's B2B brands, Sunhotels, took over contracting and supply of what today's note describes as "complementary sun and beach hotels".
Sunhotels also made its hotel inventory - around 70,000 properties - available to Thomas Cook channels. These properties will be fed into and sold to Thomas Cook customers via the Expedia platform.
Expedia and Thomas Cook have had an on-off-on relationship for a number of years. tnooz reported as long ago as 2010 that Expedia was powering Thomas Cook's dynamic packaging business before that relationship cooled when Thomas Cook decided it wanted to compete against Expedia. Three years later Thomas Cook's boss at the time Harriett Green realised that aim was a bit too ambitious (while also being a distraction) and refocused energies on a much-needed turnaround.
The idea of outsourcing the "complementary" part of its business to a partner who has invested millions, if not billions, over the years in tech makes sense for Thomas Cook Group. It can still offer visitors to thomascook.com, its shops and call-centres hotel-only bookings and dynamic packages just like an OTA, while freeing up resources to concentrate on its core activities.
Related reading from tnooz:
How Expedia sees the future in sharing its technology (Jun17)