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In my last column, I mentioned that if I was setting an e-commerce strategy for one of the big four, I would launch a super-brand, one single distribution entity at which I could throw huge chunks of marketing budget to create an online travel business which would achieve high consumer recognition. No sooner said than done. Central to last week's announcement by Airtours of its e-commerce strategy is the creation of mytravelco, described by them as "a global integrated travel service".

According to Airtours, mytravelco is going to pick-up on all the latest e-commerce fads. It is going to be on every electronic distribution channel you can think of, from the Internet and digital TV to 3G mobile devices and in-flight entertainment screens. It is clicks and bricks. There will be a chain of mytravelco shops which I assume will be akin to travel Internet cafés. It embraces the concept of "glocalisation" - think global, act local - as it will be a global business with customised offerings for local geographic markets. It will make use of the latest techniques and developments in CRM (Customer Relationship Management). 

But will it achieve its goals? According to Airtours, its first objective in investing in new technology is to enhance service, provide opportunities to enhance revenues and attack costs. 

Enhancing service is an easy one. Well implemented technology can do this and there is every reason to expect that Airtours will do a good job at assembling the necessary systems.

Enhancing revenues may be trickier. Airtours' aim is to gain competitive advantage through e-commerce. This is also Thomson's plan, First Choice's plan and numerous others have the same strategy. Now, if all the players in a market adopt similar strategies, no one is at an advantage, it is a zero sum game. Those who do NOT adopt e-commerce will certainly be at a competitive disadvantage but everyone else is still competing in the same marketplace. Airtours has mytravelco, Thomson has TheFirstResort.com, Thomas Cook has its Online offering. Airtours has flycheap.com (there's a charismatic name), Thomson has launched skydeals.co.uk. There may be little revenue to gain unless one competitor's branding and technology is better than the others. 

Airtours' second objective is to cut costs. It mentions targeting the £525 million spent on sales and marketing, brochure and commission costs. I am not sure how this figure is split between the three areas mentioned, but I do not see sales and marketing costs going down. The Group has a range of brands and products that need promoting and this is not going to change. Moreover, if mytravelco is to be Airtours' online super-brand, it will require massive marketing investment to catch up with the brand equity already invested in the likes of ebookers.com and Expedia. Sales and marketing expenditure must surely rise, not fall.

This leaves brochure and commission costs. Perhaps, if Airtours' e-commerce strategy is firing on all cylinders, driving hundreds of thousands of customers into mytravelco, it can cut down brochure distribution to travel agents. After all, if products can be viewed on-screen on TV, PC and 3G, why bother with print? 

In fact, why bother selling through third party travel agents at all? The launch of mytravelco might be Airtours' answer to cutting out printed brochure costs and agents' commissions all together. Even if this were the strategy (which I doubt), I believe that Airtours is no different from any other travel company large or small. They need independent travel agents. They need the broadest distribution possible. Those additional sales, even at the cost of paying commission, are worth having. 

Many of the largest travel principals, particularly airlines, really believe they can compete in global markets relying solely on their own distribution outlets, electronic or otherwise. There have been a number of recent announcements of portals being launched - online retail outlets - by groups of airlines and groups of hoteliers. Just like Airtours' e-commerce strategy, all of these are designed to divert sales from agents, so reducing commission costs. But these strategies invite a few questions. Will consumers like shopping via supplier owned portals or do they prefer completely independent marketplaces? Will more be spent on technology, operational infrastructure and brand marketing than the savings made by not selling via agents? 

The key to success is establishing mytravelco as THE travel super-brand. Is the cost of this beyond Airtours? We shall see.

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