Budget has been the travel buzz but when all you’ve got is low prices, where do you go when Plan A doesn't work?
That’s a dilemma the budget travel sector is facing right now.
Being cheap is proving to be a fatal flaw and begs the question: could investors have been looking in the wrong direction " is luxury travel the better long business model?
Think about the advantages " lots of room to move on prices, up or down, plenty of opportunity to value-add, and high barriers to competitor entry.
Add to that strong growing demand among travellers from all income brackets and backgrounds for a luxury experience.
An interesting argument, don’t you think.
Let’s pause, let’s take a step back and look at the pros and cons of each sector.
Low Cost Carriers hit the travel industry like a slap in the face. Not just innovative " revolutionary.
Ryanair led by provocative CEO Michael O'Leary got the party started by slashing airline operating costs and airfares while expanding at breakneck speed.
It was a spark that lit a fire.
Millions of people who previously could not afford to travel due to high prices charged by the so-called legacy carriers were now able to do so.
Other airlines followed before branded budget hotels got in on the act quicker than you could say “ancillary charges”.
Budget " the travel business model of the future!
Full story