Sneha Ullal analyses how the Indian traveller has evolved and how marketers devise strategies to sell destinations, travel and stay options to the citizen on the move across the world. The net result is that the $62 billion Indian travel industry is projected to grow at a CAGR of 10.2%
- Narendra Modi’s rise to prominence may have much to do with the successful showcasing of Gujarat through the cult ‘Khushboo Gujarat Ki’ campaign, anchored by Amitabh Bachchan.
- The landmark Incredible India campaign, the brainchild of Amitabh Kant, then Joint Secretary, Ministry of Tourism, generated a 16% increase in tourist traffic to India in 2002.
- The host of travel shows on television, print media campaigns and user-friendly digital platforms entice the modern traveller to instantly plan travel, buy tickets and book accommodation.
Travel is the big buzzword these days - everyone is looking to travel to places near and far, and around this aspiration has grown a full-fledged travel industry that is only set to expand. Thanks to higher incomes, the digital boom, convenient services for tickets and stay, the travel and tourism business in India has become one of the fastest growing sectors, with a market size of approximately $62 billion. The projected CAGR is 10.2%.
In this special issue, we attempt to highlight everything you need to know about what’s really driving the industry to this kind of growth year on year – from marketers who challenge trends and set new ones through unique strategies to technologies that have helped influence inbound and outbound travel and even media, travel agencies, hotels and airlines, who are consciously adopting a 360-degree approach to reach out to target audiences. We also talk about international tourism boards that see India among their top 10 key markets – and reach out through everything from novels to Hindi films – to get the ambitious Indian traveller’s attention.
The domestic tourism boom cannot be overlooked either, and one must give credit to Union Tourism Minister K Chiranjeevi for at least initiating the allocation of bigger budgets to certain States to improve their tourism infrastructure and marketing framework. As a result, Andhra Pradesh, Maharashtra and Tamil Nadu, the top States that attract travellers from around the world, have launched fun initiatives such as marriage and Bollywood tourism. Also part of our package is a behind-the-scenes look at the marketing strategy of travel-intrinsic television channels and magazines.
‘We are promoting Goa as a year-round destination’
The ‘Gujarat dream’ is happening: Piyush Pandey
Travel is the original social network
It is normal for airlines to utilize pricing tools to sustain demand: Giorgio Roni
From the travelogues of the well-tread
Dealing with wanderlust on the web
The trip-customizing, Internet dependent, middle class Indian traveller keeps tour operators and OTAs on their toes
Time was when travel planning began at least two months before the date of journey, usually with the help of neighbours or a friendly neighbourhood travel agent. The end point was mostly one’s hometown, and in rare cases a holiday destination. Today, people not only want to visit family and friends, but also try exotic places and activities typical to those places. Besides, no one has the luxury of time and wants everything organized at short notice. Both traditional tour operators with a strong physical store presence and online travel agencies (OTAs) have jumped into action to serve this new Indian traveller. Here’s a look at their core marketing strategies to sell destinations, travel and stay options to the Indian on the move.
Tweaking the message
Travel is increasingly becoming a necessity, more than luxury, and may be planned at the last minute. Keeping that in mind, OTAs and tour operators have changed their advertising and arketing campaigns. “Expedia launched its brand campaign for this year in April with the theme ‘Be the neighbour who travels’,” explains Vikram Malhi, Country Head, Expedia. “The campaign tried to convey the need for travel to people who often neglect it due to lack of time or not being able to book in advance and end up being the non-travelling population.” The latest 10-second montage ads for Cleartrip too centre around the Indian traveller’s need for quick and smooth travel experiences.
Promote innovative products
The industry caters to constantly changing travel perceptions and behaviours by offering specialized services for each need. Because of segmentation in the Indian travel market, Cox & Kings, for example, offers summer and winter tours to Europe catering to specific communities, such as Gujaratis and Maharashtrians, complete with home-style meals and a tour guide who can speak in their tongue. Most OTAs offer packages with custom destination, itinerary, flight and hotel bookings and discounts. “At Expedia, we have ‘Build your trip’, which encourages travellers to customize their trip and add the components of their choice; ‘Flight + hotel’ which offers flexibility at a great price; ‘hotel sales’ across cities to help consumers plan their trips in advance and ‘Deep discounts’ (upto 70%) even in peak holiday season to help last minute planners,” explains Malhi.
Focus on online marketing
Tour operators with a strong physical presence have realized the importance of being in the online space. “We’re moving away from brochure led-marketing,” says Abraham Alapatt, Marketing Head, Thomas Cook India Limited. “Digital forms about one-fifth of our overall media spends, which will only increase to cater to a swelling young urban demography, who are more comfortable online and use the Internet far more than their parents do.” Search engine marketing, too, is getting increasingly popular among both tour operators and travel portals, especially since it ends up being more cost effective than mainstream advertising. “If you search for Thailand, you’ll see a Yatra ad offering a package which will lead you to the site and a lead form asking if you want to be called. Our representative will then try to close the sale over the phone,” explains Sharat Dhall, President, Yatra Online Pvt Ltd. “This works well because the volume of people searching for holidays is huge, and we find it far more economical to source leads from here.” “With online marketing, so many innovations are possible, and reach is never a problem,” says Subramanya Sharma, CMO, Cleartrip. “Whether you develop a YouTube or display advertising strategy, you can get the same reach as TV, although TV does help you establish that big brand effect. So both mainstream and online have its advantages, and can support each other.”
Improving accessibility and mobile services
Acknowledging the fact that the Indian traveller relies a lot on his smart phone or tablet, whether booking or looking for locations when on the go, OTAs and tour operators are working on providing a better experience on mobile devices. “A marketer needs to follow the customer and make it convenient for them to find information that they are seeking. Online assists the consumer towards product and price discovery in a most efficient manner,” says Vikas Agnihotri, Director BFSI & Travel, Google India.
Last year, MakeMyTrip launched a travel app for iOS besides Android and Blackberry platforms. “Within a short span of time, we hit a milestone of 1 million mobile app downloads. Earlier this year, we also launched Routeplanner – an app that makes travel planning faster and easier by displaying all possible connectivity options and offering booking-platforms between any two places in India,” says Deep Kalra, CEO and founder, MakeMyTrip.com.
Expansion of services
Both portals and tour operators have realized that the best way to expand their services, without spending on inventory, is to tie-up with the best specialists in the business. Cleartrip recently partnered with RedBus and Travel Yaari. “We wanted to provide bus bookings especially in the West and South, the biggest target markets for bus travel,” explains Sharma. MakeMyTrip too recently tied up with State transport-service carriers such as KSRTC (Karnataka), GSRTC (Gujarat), UPSRTC (Uttar Pradesh), RSRTC (Rajasthan), BRTC (Bihar), HPTDC (Himachal Pradesh), Goa, and Punjab Roadways to offer online, app-based and SMS bus-ticketing services. Expedia also recently partnered with AirAsia, which is scheduled to launch its services in India later in the year. “Our joint venture with AirAsia allows us to combine the largest inventory of hotels with the airline, to create great value packages for travel to Southeast Asia,” explains Malhi. “Every year, we hold a special sale offering packages to South-east Asian countries with airfares and rooms for 3N/4D starting at Rs 8,495.” AirAsia, which is looking to pursue every channel of ticket distribution in India, has also tied up with MakeMyTrip and Yatra to offer air tickets to various international routes.
Providing incentives
Both online portals and tour operators have been vying for the customer’s attention by offering them extra benefits. Yatra, for instance, has a miles programme that encourages travellers to make repeat purchases. “We stay in touch with our travellers through mailers, update on the latest deals, and making sure that they keep coming back to us,” explains Dhall. “Close to 60% of our business comes from repeat purchases. That’s how the model becomes viable.”
THROUGH THE INDIAN TRAVEL MARKETER'S MIND...
Travel marketers in India are adapting to the following traits of the new Indian traveller:
Seeks activities, not pretty sights
“Activities such as white water rafting, short hikes and treks, skiing, ballooning, scuba diving, wildlife safaris are gaining popularity. Last year, we witnessed a 30% growth in holidays involving experiential travel.” Deep Kalra, Founder and CEO, MakeMyTrip
First-timers will go to travel agent
“The most effective form of feedback is the relationship that the store manager has with customers. First timers tend to choose more traditional options, the standard package tours.” Abraham Alapatt, Marketing Head, Thomas Cook India Limited
Makes his own itinerary
“He is more aware, and is no longer relying on the travel agent to suggest new holiday destinations. We have witnessed a steady rise in the number of these travellers over the last two years with 18 to 20% YOY growth.” Vikram Malhi, Country Head, Expedia
Does most of his research online
“If you look at the Internet penetration of 140 million odd users in India, about 40% to 50% have used one or multiple Internet travel sites, and approx. 50 million people are actively researching and planning their travel online.” Nikhil Ganju, Country Manager, TripAdvisor India
Prefer going away on weekends
“Weekend getaways are getting popular. The Indian traveller will take one long break and maybe two to three short breaks in a year, a trend that’s prevalent in most metros.” Sharat Dhall, President, Yatra Online Pvt Ltd
IMPROVING THE WEB PRESENCE
Vikas Agnihotri, Director BFSI & Travel, Google India outlines how different sectors of the travel and tourism industry in India can improve their marketing strategies and be better service providers online
Travel and tour operators
• They need to invest in assets, both for computers and smartphones
• Collecting leads for a holiday online via forms and via advertising their call centre numbers online are both cost-effective, in comparison to offline acquisition methods. It also improves customer satisfaction as operators can reach out to them faster
• Create scale through online as it is more efficient than offline
Hotels
•Establish assets across devices since the users are already there
• Ensure that their properties are part of inventory offered by bigger online players. This will assist them to be found through riding on a bigger OTA
• With so many users posting reviews, pictures and videos online of where they stay, hotels need to be active to monitor this content, use it for promotions as well as address complaints quickly
Airlines
• Ancillary revenue is a major part of the airline business, and online can be a great method to up-sell to a client. Seats, meals, extra baggage can all be sold online
• Online is a great medium to build loyalty and engage with your customers. With the growth of social platforms, complaint redressal online is important not just to pacify a client, but also to protect and build brand value
Tourism boards (domestic & international)
• Tourism boards need to build assets and content online that showcase their destinations and attractions
• Since a lot of holiday and destination selection/planning happens online, they need to tap this user base
• They’re driving traffic and not actively selling. So they also need great online content in terms of write-ups, pictures, videos for the destinations they’re promoting
OTAs take to hotel tie-ups
“Hotel tie-ups is the next big market we’re looking at and hope to drive market leadership in this space. We already have more than 10,000 hotels in India, the largest number probably, tied up with 2,00,000 hotels internationally. The traffic for online hotel bookings is usually the highest on Thursdays and Fridays, mostly for weekend getaways.” Sharat Dhall, President, Yatra Online Pvt Ltd.
“Bookings over the Internet have increased, with new economic segments coming up in India. For Ginger Hotels, coupled with unique OOH activities and co-branding initiatives with IndiGo, SEO has also helped us capture non-users. We operate in a mass and volume market, so digital marketing is perhaps the right answer.”
PK Mohankumar, MD and CEO, Roots Corporation Ltd
“Last year, digital sales contributed to 10% of overall sales and in the first quarter, this has moved to 15%. Significant investments in social media have ensured that the brand has one million fans on Facebook and 28,000 followers on Twitter.” Rajiv Sawhney, MD & CEO, Mahindra Holidays & Resorts India Ltd
“Hotels get the importance of managing their online reputation on TripAdvisor. They’ve also responded in a big way by embracing TripAdvisor reviews and by integrating Tripadvisor to their online and marketing promotions strategy. Even at the GM level at most hotels, they’ve started embracing the reviews on the site, which are used in weekly meetings for analysis and to come up with actionables. OTAs too are offering hotel booking services, with added TripAdvisor ratings.” Nikhil Ganju, Country Manager, TripAdvisor India
Current challenges for OTAs
.Building customer confidence about credit card transactions
.Safer, more secure online payment transactions especially for hotel bookings and airfares
.Internet penetration and robustness of network are the key concern areas for the growth of e-Commerce in Category B towns
.Think of ways to add to the post-sales experience while booking online
Feedback: sneha.ullal@exchange4media.com
