After Chris Clarkson’s excellent post about how Sunshine.co.uk dealt with the XL closure http://www.pfft.co.uk/2008/09/12/xl-dealing-with-the-aftermath/ i thought i’d post how it affected AffiliateFuture.7am – We’d all been alerted to the news that XL had entered liquidation thanks to news.Now this hadn’t been a complete suprise, the news at the start of September that XL had been seeking urgent refinancing was a serious sign that the end was close. Asking a bank for £140m in the current environement is not easy. However the real warning sign two weeks ago was when they pulled all their Carribean flights. Long haul flights are the most expensive to flights operate…fuel, taxes, catering, staff stop overs etc however they are very lucrative. Holiday costs are low when your actually in the Carribean and XL had strong sales volumes here.8.30am We have confirmed the full affect of the liquidation. We are hit with not only the XL.com and XL Holidays sites closing but other group sites Travel City Direct, Freedom Flights and Kosmar. Normally we’d require written notice from merchants and an agreed closing date followed by honouring the cookies. Liquidation doesn’t always mean that the merchant ceases trading, however in this case it was terminal.
9am We’re busy informing all the affiliates of the account closures. Most affiliates had seen the news so most had started removing links by the time we’d rung around the key affiliates.
9.30 An email is on the way to every affiliate confirming the closure and how they will be affected.
We’ll be paying every affiliate as normal in October for all sales until the closure. Affiliates are clients of us, so it’s our responsibility to protect their earnings.
10am We’re busy putting holding pages for all affiliate traffic. It will take weeks/months for all the traffic to actually stop from affiliates for a variety of reasons so we aim to monitise the traffic for them. For example www.cheapholidaydeals.co.uk has over 600,000 pages published each night, this site wont get republished until the following evening, dead XL links will make a dent in the revenues here. We also don’t need thousands of XL visitors landing on the AffiliateFuture site lost.
11am It’s now the proactive task of replacing the business lost. People will still want to go on holiday or on a flights so we are busy helping and advising who to promote. There are also thousands of XL customers looking to rebook flights and holidays. which will boost transactions.
The short term impact for us as a network is relatively minimal as the XL programmes are relatively new to the network and the peak holiday season is now over. We also have very tight financial controls in place meaning we’re unlikely to loose much if any money over this.
We are lucky in that we have some excellent programmes picking up the traffic, the likes of Avro and Ebookers will do well from this. Obviously not so lucky are all the XL staff, and the holiday makers. Our wishes also go the digital agency who managed the group as they may not survive this loss, certainly a number of staff will be facing redundancy.
The question is whose next as it’ll not be the last major travel company going under this year. Looks like Alitalia may not make it through the weekend as they can’t afford anymore fuel.
