The downfall of Thomas Cook highlights the shift from high street to online retail

Posted by AlexDobson on September 25, 2019

In a similar vein to when Monarch went out of business in 2017, there is sadness and a tinge of anger around the Thomas Cook collapse that has been hanging over the company for the last couple of months but as of Monday was officially confirmed.

The sadness is that a business which was founded in 1841 has ceased trading due to a change in customers not needing or wanting to go in-store to book a holiday. The anger is for all those employees who overnight have been made redundant.

So how has this all come about and how does this link to development I hear you ask?

Well, Thomas Cook's downfall really hammers home the side-step from high street shopping to online retail. Thomas Cook's main focus was on package holidays and city breaks. This is all well and good but over the last decade, customers have been able to book an entire holiday online within 15/20 minutes instead of talking to a travel agent and spending a good hour in town running through different options.

Thomas Cook stuck with hundreds of shops and in keeping with the bricks & mortar ethos but this equaled more overheads. This reflects the cripples of the highstreet in general as Internet shopping grows and grows. Some retailers like Thomas Cook dug in their heels and did not want to move with the times as they failed to capitalize on the growth of the online marketplace (the image below from the BBC below really highlights this).

If they had stepped back a few years ago and realised that highstreet travel shops were a dying breed then I might not have been writing this blog today.  

So what can retailers learn from this?

Making sure your online store is 100% up-to-date and appealing to your customers is an absolute must. It is such a competitive market that you have to go above and beyond in order to stand out. This is what Thomas Cook failed to grasp, to their detriment. If you look at their competitors such as Virgin or Tui they have really embraced the online holiday bookings market and played it to their advantage.

Companies should constantly be looking over their shoulders at what their competitors are doing and see how they are bringing in (or not bringing in customers). If they don't, then they will be left behind and be "knocked for six" like Thomas Cook!