Club Med Google partnership pledge raises issue of brand bidding by agent partners

Independent retailers have welcomed the prospect of Club Med collaborating with third parties on Google advertising.

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Independent retailers have welcomed the prospect of Club Med collaborating with third parties on Google advertising.

Last week, Estelle Giraudeau, Club Med’s new managing director for the UK and Scandinavia, said the operator wanted to work with agents on online marketing.

Revealing Club Med would help agents to drive bookings online, she said: “We’d be happy to do a campaign about France and share the cost of AdWords on Google with agents.”

Clarifying plans this week, she added: “Club Med are dedicated to supporting travel agents throughout the whole booking process.

“We are excited to be working on agent initiatives that will offer marketing options outside of traditional means, and hope to be able to share more information later in the year in line with our ongoing plan to work increasingly closely with travel agents on digital markets.”

Agents do not expect the move to herald a change in the policies that prevent brand advertising, demanded by many operators as part of their commercial agreements, but have called for a relaxation of restrictions in what legally is a “grey area”.

Bidding for brand names in Google’s AdWords auction is controversial, and a long-running dispute between Marks & Spencer and Interflora is making its way through the European courts.

In April, experts at the Abta Travel Law seminar raised doubts about the legality of AdWords restrictions, although the association has not taken a stance while the Interflora case continues.

Club Med is not alone among operators that use agency commercial terms to prevent AdWords bidding on Google.

Agents said they understood the approach taken by operators, but insisted a more collaborative policy would benefit both parties.

Colin Matthews, managing director of Travel Club Elite, said: “Operators are trying to have the best of both worlds – relying on agents for bookings but seeking to dominate the online space.

“This issue will not go away and needs to be addressed openly by the operators concerned, in conjunction with Abta, consortia and the Competition & Markets Authority.”

Travel Designers managing director Nick Harding-McKay said he was happy to work on strategic Google campaigns, but did not want “crumbs from operators’ tables”.

He said: “Perhaps they think they’re a cheaper form of distribution than us. But there has to be some understanding – a blanket ban is stupid. Agency owners have not acted as one. At present, operators divide and rule.”

Niall Douglas, managing director of Full Circle Travel, sympathised with operators whose brands are discounted on Google by agents.

“It’s a grey issue legally, but if operators put restrictions in contracts and agents sign up, fair enough. If there’s understanding, there’s scope to work together.”

Classic Travel owner Peter Holmes added: “Independent operators need independent agents. If operators want direct sales, that’s a different ball game.”

Matthews said using agency agreements to prevent discounting was not a ‘grey area’ legally.

“It’s price-fixing, absolutely prohibited by law, with draconian penalties. Agents and operators should not touch such agreements with a barge pole.”