Self-driven, ambitious and always ready for a new challenge, Chris Mottershead is a travel industry pioneer and crystal ball gazer. We meet the man who has taken both Airtours and Thomson to the summit of the UK travel sector and is looking to weave similar magic with his new project, Travelzest.

Self-driven, ambitious and always ready for a new challenge, Chris Mottershead is a travel industry pioneer and crystal ball gazer. We meet the man who has taken both Airtours and Thomson to the summit of the UK travel sector and is looking to weave similar magic with his new project, Travelzest.

Chris Mottershead and I meet at Travelzest HQ at St Martin’s Place, just off Trafalgar Square, where the Yorkshire-born, Welsh-accented travel industry sage takes a break from Travelzest toils to talk me through his illustrious career.

‘I was born in Yorkshire, but Wales is home,’ says the Manchester United fan whose insights are much sought after in the travel sector. In fact, he’s so highly regarded that he was recently asked to address the Association of British Travel Agents (ABTA) 2005 conference for a session entitled ‘Future Gazing’.

From the off, it’s clear that Mottershead relishes new challenges when the odds are stacked against him, and it’s this dogged facet of his personality that’s spurred his biggest achievements during his working life.

He’s first and foremost revered for his exceptional commercial skills, so it’s something of a surprise to discover that he is in fact an accountant by trade.

‘It is funny,’ he laughs, ‘but many of the main travel industry figures actually have a financial background. The travel sector is a huge financial model that’s all about maximising yield and minimising risk. External factors influence the market – 9/11, wars and so on – but there are also internal factors at play that are more controllable, such as how you manage foreign exchange and interest rates.’

Turnaround triumph
It was at Airtours Holidays that Mottershead made his biggest impact. Appointed as finance director in late 1993, by June 1998 he had become managing director of the travel behemoth. During his time at the controls, he grew Airtours Holidays profitably to become the largest tour operator in the UK, improving product, dramatically reducing customer complaints and successfully introducing a ‘values’ programme that boosted customer and employee retention levels.

‘Airtours was a great learning ground for me,’ recalls Mottershead, fondly. ‘I joined at a time when the group was going through a period of rapid growth. And at the Airtours Holidays arm, we were actually creating the profits that allowed the rest of the group to make acquisitions.

‘It was my idea to introduce that huge values program into the organisation. I wanted to make sure that we were commercial as well as highly customer service focused. So we became more creative in the way in which we packaged and sold our holidays. Stemming from these efforts, we managed to knock Thomson off the number one spot, becoming the largest UK holiday operator in terms of both size and profits.’

Having toppled Airtours’ rival from its perch, less hungry players might have rested on their laurels. However, he had an urge to accept a new challenge across the pond and in January 2000, took on the mantle of President and CEO of Airtours’ North American Leisure Group (NALG), where he was charged with overseeing all the group’s North American companies except TSI. These included two leading Canadian charter tour operators (Sunquest Vacations and Alba Tours) as well as US charter tour operators Suntrips and Vacation Express.

‘NALG was a business that had never made money because it had been badly managed – the product was all supply-driven. It was a case of, “here’s what we’ve got and here’s what you’re having”. Well, I decided I was going to change all that. I carried out some aggressive internal restructuring – there were too many chiefs with a lack of interest – and I switched to demand-driven product. ‘Within two years, we went from losses of $35 million to profits of $35 million.’

A timely transfer
Having revamped Airtours on both sides of the Atlantic, Mottershead began to grow disillusioned with the travel giant ‘at group level’, but he didn’t have to wait long for another major challenge to come his way. Airtours’ bitter rival TUI UK approached Mottershead to try and restore its sheen.

With the disastrous events of 9/11 casting unparalleled shadows over the sector, Mottershead found the offer to reinvigorate TUI too tempting to resist, becoming managing director of TUI UK just two months after the Twin Towers tragedy. His responsibilities stretched to Thomson Holidays, Lunn Poly and Travelhouse, as well as TUI’s other UK travel businesses.

‘What really attracted me was the idea that I could combine the quality and service of TUI with the commercial edge that Airtours had. If I could achieve that then I thought we would really have one heck of a business, even after 9/11.

‘Airtours and TUI had competed aggressively for years, and when I came in, I was as welcome as the proverbial… [he pauses to search for non-expletives]… well, anyway, success changes perceptions,’ he wryly concludes. And success he truly delivered, firstly by providing a steady hand at the wheel though one of the darkest periods in the companies history and thereafter scoring record profits by delivering the innovation that was missing.

For instance, he transformed the group’s new media functions, bringing in world-class internet booking capabilities that subsequently helped drive online sales from £60 million to £300 million in just 18 months. A original television travel channel was also introduced. In addition, Mottershead brought a raft of new destinations on stream, culminating in Thomson Holidays again becoming the biggest holiday player in Britain. ‘Despite 9/11, SARS and the war in Iraq, we grew profits every year and restored TUI to the number one spot in the UK by late 2003.’

Thomson continues to dominate the market thanks to the measures put in place by Mottershead. ‘I did lots of travelling and looked for opportunities outside the core Spanish market – like Croatia, Egypt, and Turkey. When I joined, the internet was less than two per cent of the business, but when I left it was more than 20 per cent. I believe it’s now more than 50 per cent.’

Fruity new possibilities
With the onset of online bookings, Mottershead could see that the next necessary phase in TUI’s development was a lengthy and brutal cost-cutting exercise. Having already faced down such hurdles elsewhere, he decided to leave TUI in September 2004 and put into play a pioneering new idea that had struck him during his time in North America.

‘I thought, “Why not create something very new in the travel industry – a company with all the successful components commentators clamour for and none of the legacy elements?” I took a look around and saw that there was no middle ground in the industry. All the main players were either very big or very small, and I felt there was potential for a business in the middle ground.’

Travelzest, a buy-and-build business focused on specialist holiday brands rather than package deals, is the child of his imaginings. Mottershead became chief executive a year ago and has swiftly set about his ambitious strategy.

With customers now far more demanding and savvy, the old model of high street travel agents offering package holidays for the Euro market is on its way out. High levels of service, knowledge and expertise in emerging markets such as Morocco or Egypt are the things that the new globalised consumer will be demanding.

Travelzest comprises an online travel operation and a series of niche businesses focused on emerging destinations and specialist interests. Online, Travelzest provides its own exclusive products as well as offering other companies a channel for their sales. For example, it provides booking services for package holidays from Expedia and Opodo.

Equally appealing is the fact the business excludes all the traditional industry headaches, such as unprofitable high street shops. Seasonality – a long-time bête noire – is not a concern either, because the plan is to bring winter- and summer-loaded business under one roof. Synergies, economies of scale and improved purchasing power should come into play.

‘I want to build Travelzest into a £100 million business within three years,’ he insists, ‘and I want to do it by including all the things that observers of the travel industry like – and excluding the elements and old hangovers that investors don’t like.’ Travelzest consists of tour operator VFB Holidays, a specialist in holidays to France and a British pioneer of the gîte holiday concept, and online travel agent Holiday Express, which owns a number of key domain names for which Mottershead has grand ambitions, including www.Holiday.co.uk and www.Flight.co.uk.

The group has acquired The Best of Morocco, a niche player offering bespoke and highly serviced trips to the African nation for individuals and small groups. Best of Morocco is the premier agent for the Marathon des Sables, a punishing foot-race that takes place every April and covers some 230 kilometres, for which it provides the largest contingent of runners.

More earnings-enhancing acquisitions are highly likely in the short term and the key to delivering high-quality targets is Mottershead himself – all the best deals and vendors are approaching him, rather than the other way around. ‘I never turn a meeting down,’ he asserts, with the scent of another major challenge in his nostrils.