After a competitive pitch, Flight Centre has chosen DraftFCB Media as its new agency.
DraftFCB Media's managing director Derek Lindsay was unaware of the other agencies it was up against. But the incumbent was Ogilvy, which took over from Total Media in 2010.
While there's no doubt consumers booking flights directly with airlines via their websites has significantly affected the travel industry, contrary to popular opinion, he says there's still a place for travel agents and he says Flight Centre had one of its biggest ever years in terms of revenue and profit.
According to Yahoo, "unaudited trading results for the 2012/13 financial year point to an underlying pre-tax profit of between $338 million and $342 million, up 17 percent from the pre-tax profit of $290 million recorded in 2011/12. The company's share price has doubled since the start of last financial year, surging from $18.99 to $40.14, taking its market value past $4 billion."
"It's a really great story," Lindsay says. "They are transitioning the business. Clearly there are a lot of point-to-point online bookings these days, but there are a lot of people who want help from an education point of view and increasingly there are people who are doing more complicated travel so there's still a dependency on someone to help with the bookings."
Flight Centre, which started in Australia and is now in ten countries including the UK the US (where it owns the country's biggest corporate travel business), does a lot of the retail-focused creative for the main brand itself (judging by the recent ads, it looks like it's chosen a new handsome captain/mascot. When asked if Lindsay applied for the role, he said: "I'm far too old for that, amongst many other things").
According to Nielsen AIS figures, which are based on ratecard, Flight Centre spent close to $11 million on media in the past year, up from around $9 million the previous year. And Lindsay says the company is looking for value and planning from its new media agency.
|MAT-1 (1/07/2011 - 30/06/2012)||MAT (1/07/2012 - 30/06/2013)|
|Flight Centre||Corporate Traveller||2||0|
|FCM Travel Solutions||2||0|
|Flight Centre Premium Travel||*||0|
|Flight Centre Travel Expo||633||1,020|
And, given the ability to measure online advertising, which Nielsen AIS figures show increased from $232,000 to $633,000 in the past couple of years, he says this will be a big part of the equation. "The key thing for the business is that it can measure its results very well so they know how their promotions work quite quickly. So the work we do will very much be around measuring their return."
"Naturally, I think digital is going to be important for their business and I think there's a lot more we can do in that area, so it's a key focus for us. They're open to new opportunities, along with the more traditional stuff they already do."