Focus: How to get to the beach before the Germans: buy the hotel

The people who run Thomson holidays are so confident they know what we want that they are buying it in bulk. And it's definitely not 'basic'

This is one of the busiest holiday weekends of the year, but in the trade they are not hanging about congratulating themselves on a particularly good summer. They are selling 1998 (and doing very well already), and thinking 1999, which means the trends for the end of the century are no longer guesswork: Turkey is on the way up; Greece is fighting back; the Dominican Republic is bigger than Florida; but Spain, with its vice- like grip on the British psyche, will remain far and away the market leader.

This summer's business is not forgotten, however. Demand is so far out- stripping supply that at least one operator, Airtours, is warning that for August, prices on unsold, last-minute holidays will go up by pounds 20 per person. Consumer expectations, as well, are higher than ever, and feedback from holidaymakers to tour operators now makes the travel business richly rewarding of success, and wholly unforgiving of failure.

Take the Olive Grove Apartments at Kassiopi on Corfu. According to page 529 of the Thomson Summer Sun brochure for 1998, they are "traditionally furnished basic apartments" offering "an inviting pool, a lush green setting and privacy" and a "good comfortable home base". The picture shows a typically white-washed building set among flowers and trees.

To stay there will cost an adult guest pounds 409, including the flight, for 14 nights in high season, pounds 215 in low season - except there will be no Thomson holidaymakers staying there at all next summer, since Thomson has removed Olive Grove from its schedule.

In a Thomson's questionnaire, only 25 per cent of customers rated the accommodation "good or excellent". Since the Olive Grove is too traditionally furnished and too basic for the modern British holidaymaker, it has become a victim of the high standards that British tourists expect from abroad - standards superior to what is considered tolerable in much more expensive hotels here at home.

AT THE exotic former cigarette factory turned sprawling office building at Mornington Crescent not far north of Euston station, Thomson, Britain's biggest holiday operator, now publishes holiday brochures in several editions, which allows for quick and brutal deletions. Each entry carries its "good or excellent" customer rating, and Olive Grove's was so low that Thomson did not wait for a second edition to make the deletion. David Burling, Thomson's short-haul marketing chief, has simply stopped selling the apartments.

By contrast, page 288 in the same brochure describes what British holidaymakers require now. The Hotel Los Gigantes in Tenerife scores 100 per cent from customers in each category: overall holiday, accommodation, location and food. Not many hotels in a British guide can match its four stars, two swimming pools, tennis, squash and badminton, a hairdresser and beauty salon, massage and sauna and - perhaps the only flaw - professional entertainers flown in from Britain twice weekly. The restaurants serve local specialities, roast meats and vegetarian meals. The rooms - and some suites - are decorated in tasteful pastel shades. Double beds are available, instead of the standard twin, with direct-dial telephones on the bedside table. New arrivals are greeted with wine and flowers and fruit.

The high season price is pounds 679 for 14 nights, including flight (low season, pounds 365). "Though some new visitors think the manager, Senor Pepe de la Rosa, looks too busy to talk, he is simply on the look-out for ways to improve his hotel," explains the brochure.

But Sr de la Rosa can afford to relax: Thomson has bought every one of his 225 rooms for 365 nights a year in a never-ending cycle of younger visitors in summer who give way to older, retired couples in winter. Mr Burling will not say how much, exactly, his company has paid to lease the hotel but suggests pounds 25 per room per night as an indication: pounds 9,125 per room and slightly over pounds 2m for the whole hotel. Sr de la Rosa does not even have to worry about what is known within the industry as "the graveyard" fortnight before Christmas when hardly anyone in Europe travels. For Mr Burling, it's a good price. "pounds 25 for a four-star hotel, half-board in Tenerife - you would never get anything like that in an equivalent four-star in this country." But Mr Burling also absorbs the hotelier's risk. The onus on filling the 225 rooms falls on Mr Burling, not Sr de la Rosa.

Thomson works on a 95 per cent occupancy rate. Of its 4.1m holidays sold this year (at an average price of pounds 450 each), 50-60 per cent were in rooms like those at Los Gigantes. But the gamble is not as great as it seems. The European package tour market is mature, and operators know from experience what sells.

For a start, half the people leaving Britain head for Spain, which includes the Balearics and Canaries, in winter and summer. Tuscany or the Dordogne may be more fashionable, but Spain does the business. Mr Burling explains that Spain's tourist industry is totally efficient and professional. Late in the day, the French Riviera has decided to try to catch up - for the first time, French hotels will feature in the main Thomson 1999 brochure - but it has a long way to go.

After criticism of walls of high-rise buildings crowding the beach-fronts, the Spanish government is encouraging hoteliers to think low-rise. Five years ago, a basic room near the sea was enough. Now, there must be a view, plenty of green and lots of "add-ons", with kids' clubs top of the list for families.

Spanish hoteliers are eagerly embracing the latest trend for "all-inclusive" packages which do not require the customer to pay anything extra for food, drinks and sports facilities. For the hotel, "all-inclusive" means buying in bulk and keeping costs down. For the holidaymaker, it means there is nothing more to pay. (Suggestions that "all-inclusive" translates as "buffet" at breakfast, lunch and dinner are treated by the operators as somewhat frivolous.)

Above all, the Spaniards are striving to give the British holidaymaker what he or she desires more than anything else, value for money. As proof of the pudding, the Spanish approach is spreading. This year, the Dominican Republic will receive 120,000 British visitors, more than head for the assorted attractions of Florida.

Ten years ago the Dominican Republic was a nowhere place which did not feature in brochures at all. Then the local tourist authority and hoteliers woke up to the possibilities, and now there are fine, low-rise hotels, many of them owned by Spanish chains. A fortnight in a four-star hotel in the Dominican Republic costs pounds 900, all-in: flight, accommodation, as much food and drink as you can consume. "We can now offer two weeks in the Caribbean against two weeks in Greece for not much more" says Richard Nealon, Thomson's long-haul manager. "The gloves are off!"

Mr Nealon and Mr Burling, Thomson's short-haul manager, are young, keen, rather earnest, sober-suited. They could be managers selling anything, anywhere. Like their offices, these men bear no relation to the glamour of their brochures, although an over-the-top manner is not completely absent from the London office. Russell Amerasekera, the communications director, wears a vivid, scarlet shirt coupled with a bright yellow tie and talks non-stop.

We learn that, while Thomson once produced one brochure, it now publishes 21, each carefully targeted at a different audience. There is Club Freestyle for the 18-30s, Young at Heart for the over 55s, Small and Friendly for people who want something quieter, Cruises, Faraway Shores for those wanting to go further afield, A La Carte for top of the range hotels, plus brochures for individual countries.

This year, the company will hand out 28 million brochures - one for every two people in Britain - and every entry is approved by the hotelier concerned, and every customer rating is genuine. Consequently, they are studied avidly by the trade: "If two hotels sit side-by-side and one has a higher food rating, the other will want to get its score up," says Mr Nealon.

And business is booming. Thomson's Winter Sun brochure, advertising holidays from November 1997 to April 1998, is 85 per cent sold already as a result of raised standards, growing wanderlust, earlier retirement, building society windfalls and a strong pound. But these factors are still not a guarantee against failure. Operators still make mistakes. The Gulf War left companies holding unsold rooms in the Middle East. A Thomson brochure contained a typographical error stating that holidays in Gambia cost pounds 55, instead of pounds 550. Thomson had to stand by its brochure, and travel agents were crushed in the rush. Palm Beach, Florida was an unexpected disaster. Thomson was sure the resort, which is a winter retreat for wealthy families from the northern states, would be a winner, but the people who read the Florida brochure wanted a holiday for their children too, and that meant Disneyland and Orlando. Out went Palm Beach.

Now it is the turn of the Olive Grove Apartments in Corfu to experience rejection, and to remind us that in the holiday trade, things ain't what they used to be.

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