The Spanish online booking group has added 500,000 subscribers in the past three months. This may be the surest validation of the model the travel industry has seen to date.
Spanish online booking group eDreams Odigeo has recovered from the travel industry’s Covid-induced crisis faster than most airlines due to its subscription model which it hopes to expand further, CEO Dana Dunne said on Wednesday.
He spoke after the Madrid-listed company posted a smaller quarterly loss than a year ago, and said it had surpassed pre-pandemic booking levels for the last three months, including a 27 percent rise in August compared with the year-earlier period.
Airlines are operating at 71 percent of the traffic levels seen two years ago, according to data from European air traffic control agency Eurocontrol.
“That bodes well for us and we do know we have been taking market share, that is really bright for the future,” Dunne told Reuters, attributing the recovery partly to its strategy to sign up subscribers, who pay a fee of around $65 a year to have access to better deals.
The company had 1.5 million subscribers at the end of August, up from 1 million three months earlier, and expects to reach 2 million in the first half of 2022, a year earlier than planned, he said.
While subscriptions are common in other industries, such as music, television and telecoms, eDreams is a pioneer in developing it for the travel industry.
The industry is yet to recover from the impact of restrictions imposed around the world to curb the coronavirus pandemic, many of which are still in force.
The company’s loss before interest, taxes, depreciation and amortisation narrowed to $5 million in the first quarter from $18.5 million a year ago, out of revenue margin of over 68 million euros, up from around $20.1 million last year.
Its shares rose 2.7 percent after the results announcement.
(Reporting by Inti Landauro; Editing by Andrei Khalip and Mike Harrison)
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Photo credit: eDreams Odigeo plans to further expand its subscription model. Sergey Zolkin / Unsplash