In today's global tourism market, to future-proof your business, you must vertically integrate and scale up, says Friedrich Joussen, CEO of TUI Group, speaking at the ITB in Berlin this week.

At the same time, transformation and adding value creation is key.

The next big challenge for us is taking our business into two platforms, 27 million customers in a global cloud," said Joussen. "We are looking at the question of global inventory – and how we optimize the value creation."

"But in five years, it's likely Tui will be more a digital company than a vertically integrated company," he added. "We are building more digital platforms….these scale better."

"TUI today is not the TUI of five years ago," he added.

Formerly CEO of Vodafone Germany, Joussen has run Tui since 2013, where he transformed the company from a trading company and tour operator into developer, investor and operator of cruise ships and hotels to become a leading tourism super brand. Today, Tui has online portals, six airlines with 150 aircraft, 380 hotels and 16 cruiseliners and 1,600 travel agencies – essentially a company developing and operating assets.

This integrated offering enables Tui to provide our customers with an unmatched holiday experience in 180 regions, the company says. In 2018 financial year, the TUI Group with a headcount of around 70,000 recorded turnover of €19.5 billion ($22 billion), an increase of 6.3 percent.

Now Joussen says the company wants to leverage blockchain technology to create a more open fairer platform to actualize inventory.

"We have transformed from service to product company and now into digital service company," he said.

He says more focus on the Caribbean, Cape Verde and Southeast Asia. And the next big thing for Tui is activities, a sector where Tui is strong and already has an advantage.

"I see a huge market place, it's growing fast 7 or 8 percent, and incredibly fragmented," he said. "What we think we need is a good platform to curate content. We are already in terms of offerings the biggest – we had 4.5 million sold last year."

"We know what the customer is doing from booking to departure, we know what they did last time they traveled, their preferences, and we have their electronic contact – it's easy for us to customize to their preferences," he added. "What we also have is a physical presence in 49 countries. In terms of customer care, we believe we have strategic advantage."

And while many others are headed toward the activities market, Joussen says competition doesn't bother him. 

"Competition is everywhere," he said. "The question is what do you do with it." 

This is strictly an exclusive feature, reprints of this article in any shape or form without prior written approval from 4Hoteliers.com is not permitted. Jabeen Bhatti is reporting exclusively for 4Hoteliers.com at ITB Berlin 2019 - www.4Hoteliers.com/itb.

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