Online travel agency (OTA) On the Beach has snapped up smaller rival, Sunshine.co.uk, in a transaction estimated to be worth £12 million.
Founded in 2004, On the Beach specialises in traditional short-haul beach package holidays in Europe, thriving on the success of the digital travel industry, with over half (53%) of all travel now booked online.
The move will bring in around 200,000 new customers to the Cheadle-based agency, adding to its existing 1.2 million customer base.
Commenting on the buyout, chief executive Simon Cooper said On the Beach is “delighted”.
“This earnings enhancing transaction reflects the Board’s ambition to consolidate On the Beach’s leading position in the online beach holiday space while supporting our drive to exclusivity and underpinning our ability to further leverage our scale,” he commented.
Affiliate & travel
Travel is a lucrative vertical in the affiliate marketing industry with 40% of brands employing the channel for customer acquisition and 20% for retention, according to Performance Horizon. A recent study on the online performance marketing spend from the IAB and PwC also uncovered that travel and leisure are behind 18% of total spend.
The buyout comes in spite of an investigation of comparison sites; the Competition and Markets Authority cautioned it could implement a “clean bill of health” to the market and take legal action, following concerns over transparency and anti-competitive practices, thought to be prevalent among comparison sites, including OTAs.
On the Beach does not seem to have been affected, however; the deal follows a positive end of the year for the agency which reported a 12% growth in revenue to £70 million for the year to September 30, 2016.