12 September 2006

Online Travel Market In India - The New Wave

India with its population of more than one billion people, is an attractive destination for showcasing the Travel and Leisure Industry.

Today the Online Travel Industry is on the verge of becoming one of the most powerful and dynamic parts of the booming Indian economy.A new report by PhoCusWright, "The Emerging Online Travel Marketplace in India," estimates that online leisure/unmanaged business travel gross bookings in India totaled $295 million in 2005 and will grow nearly sevenfold in just three years to go beyond $2.0 billion by 2008.

Rapid growth, technological advancement and increasing affluence are changing the way people buy travel and opening up a dynamic marketplace to the rest of the world despite of the fact that India is quite different from other areas of corporate travel expansion; the cultural and market differences here make expanding a global travel programme in India a unique challenge.

The internet is redefining travel distribution, with customers buying their travel through an ever-increasing number of sources and channels.It is interesting to note that the Indian Travel Online marketplace is already gearing itself to be big.

Already a plethora of online travel portals have mushroomed promising to offer a whole lot of services.According to PhocusWright, already In 2005 and 2006, at least eight startups or subsidiaries of established entities have or will have launched sites in the market, including Makemytrip, Yatra.com,Cleartrip.com and Indiatimes Travel. With an estimated $60 million in venture capital backing online travel agencies in the past 12 months, Travelocity India in the wings and an Expedia entry certainly not far behind, significant investment in the online channel in India is well underway.

Airlines:
With the arrival of a gamut of new low cost carriers, the Indian airline industry is experiencing rapid change and expansion.The continued emergence of new airlines in the low cost market place, and the attempt by traditional airlines to generate more sales via their websites, means that the choice for customers is greater than ever.There are now 8 low-cost airlines in India, and more are planning launches this year already.

As the grapevine suggests there are plans that, A group of 1000-odd travel agents across India reportedly offered to jointly acquire a 30 percent stake for around US$156 million from a private operator [more here]...

Analyst report indicate that, there is no major market in the world in which Low Cost Carriers (LCC's) have grabbed so much share from traditional travel providers in such a short period of time.

Hotels:
A large number of independent operators coupled with a more complex product offering has meant that the Indian hotel industry has been slower to embrace e-commerce. However, as India's major hotel chains develop more robust online marketing and distribution strategies and online intermediaries race to become one-stop shops for hotel deals.

In the US and Europe, the leading online travel intermediaries have taken market share from their offline counterparts. At the same time, an increase in direct sales through travel supplier's own websites has also affected the traditional agency business.

The need to balance direct and indirect channels, demand for lower cost distribution and the growth in popularity of comparison shopping are all factors driving the business model for travel specific search engines globally.

Way to go...!!!

No comments: