Leading tour operators are merging their online and offline plans to grab a bigger share of the promising, yet under-served digital travel booking space.
Online travel booking is a largely untapped market, especially in Tier-II and Tier-III cities, which contribute only five per cent to the overall transactions. A recent study jointly released by Google and management consulting firm Bain & Company shows despite India’s active internet user base of 390 million in 2018, most users are loath to transact online, leaning on offline consultation to seal their tour itineraries.
For Thomas Cook, the expertise and human touch of its tour operators continues to hold sway for the family segment, first time travellers and regional India’s Tier-II and Tier-III source markets.
“Our hybrid clicks & bricks model has hence seen strong uptake given an omni-channel experience, providing customers with the option of booking their travel online and continuing their journey offline, at their closest Thomas Cook India outlet, or of speaking to our call centre teams for that much-needed human interface. Additionally, our assisted booking model with our contact centres comes in handy especially for first time travelers and customers from regional India; which also works as a strategic tool for up sell and cross selling of add on tours, Forex, insurance, etc”, said Rajeev Kale, President & Country Head, (Holidays, MICE, Visa), Thomas Cook India Ltd.
Kale feels online bookings in lower rung cities is an under leveraged market with high growth potential. “Thomas Cook Holiday mobile app saw a growth of over 50 per cent month-on-month while leads for Foreign exchange app saw a 100 per cent uptake. A significant highlight was the consumer behaviour to opt for visas online – with a growth of over 300 per cent”.
The report by Bain & Company forecasts nearly $24 billion in incremental bookings to be done online by 2021. Moreover, the share of online travel bookings is tipped to grow from 25 per cent in 2018 to 35 per cent in 2021. Online bookings in India will be fuelled by deepening internet penetration from 33 per cent to 50 per cent over the same period.
Realizing the duality of online research and offline bookings, Cox & Kings has designed Holiday clubs that offer myriad experiential holidays which have translated into a surge in walk-ins at its stores. “Authenticity and safety are the two most significant aspects of any online service. Users expect their personal details including banking to be in safe hands while transacting. The portal being user-friendly is the second expectation which is followed by easy access to customer care and immediate help”, said Karan Anand, head, relationships at Cox & Kings.
“The online travel market is evolving at a faster pace due to the increase in outbound tourism....However the online travel segment in India is highly under penetrated in India as compared to other countries but it is growing every year. When it comes to travel bookings, still a lot of transactions are happening offline but this will change in the coming years with everything moving towards digital”, said Neelu Singh, chief executive officer & director, Ezeego1.
The report by Bain & Company estimates that Indian travelers will spend $136 billion in three years, with $42 billion available in incremental spending for various travel firms to tap into. Online players have more ground to cover since existing users state a marked distrust in use of online channels to make bookings, especially around payment and pricing terms and booking experience compared with offline channels. Consequently, their online usage drops between the research (more than 86 per cent online influence) and booking phases (40 per cent offline bookings).