Spanish-listed online travel group eDreams Odigeo has revealed a new "action plan" to cope with the challenges arising from the evolving travel industry.
The plan is the brainchild of Dana Dunne, who took over as group CEO earlier this year. He joined from easyjet where his position as chief commercial officer gave him insights into marketing, yield and the customer proposition.
The action plan covers these disciplines and more. It will apply across its portfolio of five brands - the eponymous eDreams as well as GO Voyages, Opodo, Travellink and Liligo.
The six identified elements are:
- Optimize our traffic source by reassessing the channel mix, focusing on lower-cost channels and customer retention
- Increase focus on mobile web, which attracts a large and growing share of customers
- Enhance end-to-end customer experience, simplify user interface, address pain points, and enhance value and service delivery to customers
- Maintain a lean and nimble model, with enhanced product quality, increasing our agility to adapt to the ever-changing environment in which we operate
- Diversify our revenue by delivering value-add products and services that increase our customers’ basket size while enhancing their customer experience
- Culture and talent, building a passionate and empowered organization that will drive long-term success
The new strategy was revealed at the same time as eDreams released its financial results
for the year to end-March 15.
Despite the new plan, the business performed in line with expectations, with "revenue margins" of €436 million and an adjusted EBITDA of €90.5 million.
It handled some 16 million passengers during the year.
The first point of the action plan - focusing on lower-cost channels - is put into context by a line in the results in which eDreams blames a big hike in its variable costs on "the change in the Google algorithm."
Elsewhere, the business has seen some success in trying to expand beyond its European roots. Its "core" markets are Spain, Italy, France; everything else counts as expansion markets. The latter category lifted revenues and bookings by 12% in the year and now accounts for more than 40% of group revenues.
The core markets saw bookings down by 10% with the drop in revenues less steep at 5%.
This February it launched eDreams in Japan.
The action plan has two phases - the current year will focus on near-term performance through cost control, mobile initiatives and customer retention ; 2016-17 will be when the "growth trajectory" returns, driven by new products and partnerships as well as a more agile approach to its IT set-up.