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This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.
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While Bhutan Tourism has been enjoying healthy footfall from India, Thuji Dorji Nadik, Acting Managing Director, Tourism Council of Bhutan stated that the country is considering using Guru Padmasambhava in their tourism promotions to attract more tourists from the neighbouring Himalayan regions. Guru Padmasambhava, also known as the Second Buddha, was a sage guru said to have transmitted Vajrayana Buddhism to Tibet, Bhutan and neighbouring countries.
“Although we are a Buddhist country and get inquiries about Buddhist Pilgrimage Tourism, we have no connection with the historical Buddha. We can’t even claim that he came to Bhutan! Hence, we want to promote Guru Padmasambhava for this sector. He was believed to have been born in Pakistan and flown on a tiger across India, Nepal and Tibet. This angle thus fits in more perfectly with us and connects all the Himalayan region countries, from Pakistan right down to Ladakh, Nepal, Sikkim and so on, allowing us to tap all these markets,” he said.
In Bhutan, Guru Padmasambhava is associated with the famous Paro Taktsang or "Tiger's Nest" monastery. Later he travelled to Bumthang district to subdue a powerful deity offended by a local king. Padmasambhava's body imprint can be found in the wall of a cave at nearby Kurje Lhakhang temple.
Speaking about the Indian market in particular, Nadik stated that, as tourism is evolving it is becoming very clear that destinations cannot rely on long haul arrivals. “The Indian neighbouring states are all aware of Bhutan, which makes them very important. Increasingly, western and southern India are getting to know more about it as well. We have direct flights to Delhi, but due to a lack of marketing budget, we were not aggressive in the past, and as a result they were not very aware of Bhutan either,” he said.
He further added that Mumbai is a market growing in importance, with Druk Air, whose plans to launch direct flights to Mumbai last year are currently on hold, hoping to get airport slots in the city’s upcoming T2 terminal. “Like Heathrow’s second runway issue, Mumbai had its capacity issues and were unable to give us an appropriate slot. They had a lot of grandfather rights there and the early morning slot that we were given was not very feasible. So we have put it on hold, but it’s very much on the cards. We are all waiting for the T2 to open so we can try again. Druk Air is also restructuring, and have increased their fleet size. In fact, one of the reasons for their fleet expansion was to include Mumbai flights.”
According to Nadik, with the devaluation of the Rupee, Bhutan is a great destination choice for India at the moment, as the currency has remained stable. Even the US$200 visa fee charged to western countries does not apply to Indians, who have the option Visa on Arrival, and even the option of travelling on just their voter ID cards.
“We are getting a lot of interest in destination weddings from India. We have identified three major tourism sectors we can cater to – nature, culture and wellness. Of course, India is way ahead of us in wellness, so that may not be a crowd-puller, but the other two facets do well. Events are also gaining momentum, but we are not yet ready for MICE in the actual sense of the word. Meetings and Incentives are possible, but we don’t have the infrastructure for Conferences and Incentives. There are also natural limitations and low airline capacity, which will limit numbers for MICE anyway,” said Nadik.
Furthermore, Bhutan hopes to position itself as a connector hub for North East India and Thailand as well. “We are providing a lot more connectivity to the North Eastern region of India than India herself does. Since we launched flights from Guwahati and Bagdogra, we have seen a number of Indians flying into Bhutan and subsequently travelling to Thailand. So we are looking at not just attracting inbound tourists to Bhutan, but also ferrying them ahead to Bangkok and so on,” said Nadik.
Highlighting their works with the Indian travel trade, Nadik stated that roadshows and participation in events such as SATTE have become regular features.
Michael Gaebler, Chairman & CEO, Aviareps revealed that the company has an ambitious target of tripling its India business by 2020. The company has 12 clients in India so far, ranging from attractions to airports and airlines, including Dallas Airport and Air Namibia, among others. Speaking to the media during his recent visit to Mumbai, Gaebler stated that the company will try and push its IBCS and Avianet service for airlines and airports, and also work with GDS’s to grow hotel businesses in India. The IBCS program provides an opportunity to profitably participate in marginal market BSPs with negligible capital risk.
Speaking about their focus for the Indian market, Joseph Fernandes, General Manager India, Aviareps said that the company will focus on building its aviation portfolio in India to form a balance in their tourism client base. He further added that, in addition to their Mumbai and Delhi offices, Aviareps hopes to soon have a Bengaluru office to have a strong pan India presence.
“Our Agenda 2020 is to triple our growth in India in the next seven years and we are taking steps towards the same. We are also studying Sri Lanka and Bangladesh markets with the intention of handling clients in these countries from the India office. We are also mooting the possibility of offering India as a South Asia country and are gauging the market’s reaction towards the same,” said Fernandes.
Speaking about the India market and their modus operandi here, Gaebler opined that India is a special market in some way, but the method for marketing products is not so different. “People say that the biggest challenge in India is that is is a more price-centric market out on a bargain hunt, but I don’t know of a single market that doesn’t look out for a better price. Also, I believe that the convenience of booking and transacting online is overtaking this habit, making it less of a hindrance in business,” he said.
There is no ignoring the new bug that has bitten the whole world (age no bar) - the smartphone. The smartphone has moved everyone off their desktops and laptops, and onto their cell phones, owing to the sheer convenience of the device being able to provide almost every day-to-day service that the former devices can. From mobile-light sites to cloud computing, the phone has become the Pandora’s box to anything that needs to be done online and on the move. But being the insatiable species that we are, we wanted (and got) more. The world has moved onto the even more user-friendly interface of mobile apps, and the tech savvy travel industry refused to lag behind.
“The Indian online travel market is one of the fastest growing in the world. The stronghold of India IT development can be seen as a major reason for this extraordinary boost in the past decade. The travel vertical is a prime example, one which Abacus underpins with its technology, supporting the new digital new business models. We are helping conventional travel businesses build out into the digital world, attracting new customers and transacting in new ways, as well as encouraging online travel agents to scale,” said Jeet Sawhney, MD, Abacus India.
Rajesh Magow, Co-Founder and CEO-India, MakeMyTrip commented that, technology has not only changed the way travel is distributed, it has also affected the way travellers experience it. “Today, Indian customers are fairly confident of purchasing travel-products online from their preferred portals, or through mobiles. They have also become much more comfortable with accessing travel services and making a purchase decision online. These trends have and will continue to accelerate the growth of the industry,” he opined.
The ‘app’roach to mobile travel
The advent of mobile technology has kept the travel space on their toes, vying for the Indian travellers’ attention by catering to their every need via the smartphone. A study from PhoCusWright research suggests that mobile will be the fastest-growing travel distribution channel in India between 2012 and 2015. “Mobile travel gross bookings will surge an astounding 1,026 per cent between 2012 and 2015 – reaching US$1.2 billion,” the study stated and suggested that new technology and technology enhancements must be designed with mobile capability in mind.
Sawhney opined that Abacus connects travellers to the agents on any web-enabled device and with 39 per cent of Indian business travellers now making travel arrangements including bookings via smartphones. “This is proof enough that the platform provides a huge market,” he added.
According to Sandeep Dwivedi, Chief Commercial Officer, InterGlobe Technology, the world is evolving and technology is becoming an enabler for all. “Mobile technology is a key priority as more people are moving to mobile devices to access online content. The travel sector in India is very quickly adapting to new technology now available to them. With the smartphones available more and more travel search and planning is happening by travellers themselves directly. Various players of the travel industry are moving towards embracing technology as it will help them reach a wider set of customers. Besides, they are able to showcase their products and services more effectively using various tools that are available,” he explained.
Cleartrip has recently provided customers with the option of cancelling bookings via the mobile app. Subramanya Sharma, Head of Products, Cleartrip shared their app contributes to 65 per cent of mobile traffic and has served as a great tool for engagement and notifications. “The increase in mobile phone usage has led to innovations in the travel space, such as the advent of multi-screens on mobiles. Access and personalisation are provided through mobiles, and the mobile app becomes a marriage of convenience and access,” he opined.
MakeMyTrip launched its first mobile app in 2011 and in June 2012 became the first Indian OTA to offer a travel-booking app for iPhone users. These apps allow customers to book flights, hotels and bus on the move, cancel their bookings, track the status of their refunds, send e-tickets and vouchers, check flight status and also look for alternate arrangements in case of last minute delays. Today, mobile accounts for more than 19 per cent of the OTA’s monthly unique visitors and 15 per cent of online transactions. In domestic flights, mobile bookings account for 15 per cent of total online transactions, while standalone hotel bookings from mobile represent 27 per cent of total online domestic hotel transactions for MakeMyTrip.
“The take-off of mobile internet and applications has revolutionised the OTA segment. Access channels have evolved with the growing dependency on smartphones, and today more Big Data has also emerged as an important enabler for travel companies to engage better with customers and deliver service efficiently and intelligently. It provides us a great opportunity to positively impact both the business-end and the experience at the customer-end through better decision-making, greater product and service innovation and stronger customer relationships that will be delivered by new approaches to customer management, revenue management and internal operations,” said Magow.
Kunal Mittal, CEO and Founder, 90bids.com, which is currently readying it’s own mobile app, believes that mobile internet has created the biggest revolution in the sector of e-commerce. “Initially there were days when a person who had to travel had to go to the counter to purchase hotel accommodation, flight tickets etc. It required time and was expensive as well. Today, all these offerings are available at the customer’s fingertips. This has also led to competitive pricing,” he said.
Aman Travels is also set to launch a mobile app for it’s customers. “Technology has done wonders for the travel business. It has opened new frontiers and changed the distribution system. One has to incorporate it or else be wiped out of the business,” opined Deepak Narula, Managing Director, Aman Travels.
Saurabh Srivastava, VP Marketing and Product Strategy, ixigo.com, stated that mobile is the next big thing in online travel. With newer apps being introduced by various players and the ease of making bookings on the phone- technology is the main dominant factor in taking the online travel industry to its next phase of growth.
“The potential of mobile platforms to facilitate travel is compelling. The scope is immense,” Srivastava opined.
What’s on offer
Designing and launching mobile apps to book travel and accommodation was the start of this phenomenon. The industry then moved on to provide trip planning, cancellations, hotel reviews, guidance and many more functionalities. And all of this is just the tip of the iceberg.
“The world is moving towards all mobile at a very fast pace. The age of wearable technology is just starting and in the near future we will start seeing very practical uses of this. In 10 years from now, people will be using wearable technology (equivalent of Google Glasses, Smartwatches) for having all information at one’s fingertips, conduct online transactions and also controlling equipment (cars, stereo systems, etc.). Yesterday’s science fiction is today’s reality and today’s science fiction will be tomorrow’s reality,” opined Magow.
Mittal believed that idea generation and creativity have no boundaries, while execution of such ideas and creativity leads to Innovation. He predicts much more to happen in the online space. Srivastava opined that social media will have a huge role to play in future and is already a big boon to make data analytics even more powerful. Mobile is a big focus area for ixigo.com and the company expects its next 100 million users to come through the mobile platform.
“The future ‘value-pull’ for agencies will be in successfully integrating mobile and website versions of the requisite travel solutions they use. For travel agents, therefore, mobile formats and app integration are likely to be key sales conversion factors where there is an opportunity to target these customers. Timing and content is everything. The value comes from delivering the right functionality at the right time to the right type of traveller. Most travel solutions today should offer online check in as standard, and the ability to provide that is important to those agencies that do not yet have it. Equally important is the ability to up-sell and gain ancillary sales. Looking further ahead, the future value will come from gaining the necessary customer intelligence and travel content to help sell better as well as providing the necessary solutions to help travellers to help themselves,” said Dwivedi.
Digital v/s conventional marketing
India is a young market with an old soul. So while most industries have begun to move towards online and digital marketing, with the travel industry being at the forefront of this trend, just as mom-and-pop shops have survived the advent of OTAs, the debate over digital marketing v/s conventional marketing continues. This has resulted in the industry turning it’s focus to digital marketing, while never taking it’s eye off conventional marketing strategies.
Magow stated that, the Indian travel sector has adopted innovative trends, technologies and given a whole new dimension to this industry over the years. Digital marketing contributes immensely to this growth and is a rapidly growing force in the current marketing playing field.
“The RoI on digital promotions is easier to track and analyse. Offline campaigns are more long-lead and we primarily use them for brand-building purpose. As a company one of our priorities is to make judicious use of offline channels (TV, radio, print) to create visibility for the brand and promote specific lines of business such as international and domestic holidays,” he shared.
Srivastava commented that, while the expansion of Indian media has given a wider range of choice to brands, it has also made marketing more measurable and complex. Today, the real challenge is no longer to divide marketing budget between ATL (Above The Line) and BTL (Below The Line), but to be able to look at the life-cycle of a brand and aptly marry it with brand intentions, he added.
Narula opined that digital marketing gives the industry more mileage in less time and budget as conventional market is a slow process. However, Mittal believes that both have their own advantages and disadvantages. “It completely depends on the kind of targeted audiences and various other factors. We prefer doing both at times,” he said.
The future of mobile apps
The innovation in mobile apps is astounding and the possibilities for further development endless. Abacus, for one, currently offers 500 apps for the travel agents and the technology is open-source so that they can customise those provided even further to suit their specific needs. The mobile apps are a huge focus for the company which has more products waiting in the pipeline.
Ixigo.com has introduced six innovative mobile applications in the Google Play Store (Android and iOS platforms) that offer useful travel information for specific use cases. “We recently added reviews of trains and train stations to our trains app and have received great response from real users. We are also expanding to Windows OS for our apps and already have the ixigo brand app on the Windows platform,” revealed Srivastava.
In the last five years, Travelport has invested over US$400 million in research and development to provide solutions that meet the business needs of customers and reduce their overall cost of revenue. Travelport has already launched some revolutionary products such as Smartpoint, Travelport Rooms and More.
In the near future more revolutionary products such as Travelport mobile App, Universal API, Travelport Merchandising Solutions etc are expected to be available for Indian market. These are all solutions which are aimed towards creating new benefits and value for the travel chain. “These products not only bring in efficiency for the travel agents but also create alternate revenue streams for them,” explained Dwivedi.
MakeMyTrip has a travel-inspiration app called TripIdeas which offers holiday and destination trivia to inspire people to travel, and an app called Routeplanner which enables trip-planning between any two destinations in India faster and easier.
At the welcome dinner of the recently concluded World Tourism Conference 2013 in Melaka, Malaysia, Tourism Malaysia unveiled their mascot for their Visit Malaysia Year (VMY) 2014 campaign – the Proboscis Monkey. The first glimpse of the mascot was part of a glittering evening hosted by YB Dato’ Seri Mohamed Nazri bin Tari Sri Abdul Aziz, Minister of Tourism and Culture Malaysia, and attended by the Malaysian travel trade, Conference speakers and delegates, exhibitors, global media and UNWTO and Tourism Malaysia representatives.
Bangkok property Siam Kempinski Hotel is set to tap the Indian medical tourism segment and is currently in talks with airlines and hospitals to design suitable packages. “Hospitals in Bangkok are incredible. The quality of doctors as well as infrastructure is very good and the service is fantastic, all at reasonable prices. You can even run tests and get results the same day. We are currently in talks with Bangkok Air and Thai Airways to tap the Indian market for medical tourism,” said Alejandro Bernabe, General Manager/Area Director Southeast Asia, Siam Kempinski Hotel.
The initiative by Siam Kempinski includes commute to and from the airport and hospital, as well as help with arranging appointments.
In addition, the property is keen on increasing its destination wedding footfall from India. According to Bernabe, the property offers a unique venue with enough room for all the functions as well as culinary flexibility. “We are bullish on the wedding segment as it contributes a lot to business owing to the number of functions. In addition it provides F&B revenue and room nights. The hotel enables all functions to take place without having to leave the hotel. We are aiming at no more than one wedding per quarter as the ceremonies are sometimes over three days long and it puts a lot of pressure on the property,” he added.
This is the second year Siam Kempinski is visiting India, which Bernabe believes is an indication of India’s importance to the property. The delegation visited Mumbai, Delhi and Kolkata. “With little effort, the market has already become number nine, most of it leisure. If you talk about just leisure, India is among the top three. It contributes 10-15 per cent to business annually,” he stated.
Rail Europe has year after year cemented its success in the Indian outbound travel segment as reflected in their growth figures. According to Kunal Kothari, Executive Director, Rail Europe India, until August, sales have been up by 8 per cent while pax numbers are up by 6.3 per cent. This number was 9 per cent and 7.76 per cent at the end of July.
Although the Rupee depreciation has had an impact on outbound travel, particularly to western nations, Europe remains on Indians’ priority list. “Yes, the rapid depreciation in the rupee did hamper the numbers. Having said that, I think once the volatility of the rupee disappears the travellers will be back as usual. It is not the depreciation that hurt us as much as the rapid uncertainty of it. The depreciation was as big as 25 per cent in a span of six to eight weeks. That hurts the immediate travellers, especially the late minute ones,” opined Kothari.
As part of their marketing campaign for the year, Rail Europe India recently organised a familiarisation tour for travel agents and the media in a bid to showcase some of its rail routes. Traversing between Florence, Milan, Nice, Marseille, Interlaken and Zurich, Rail Europe, with the support of the Tourism Boards of Nice, Marseille and Switzerland, arranged a week long soiree that gave the group a chance to experience the Eurail, France Rail and Swiss Rail products.
The journey commenced at Florence, Italy, with regional train journey to Pisa, giving the group a starter dose of scenery, history and culture that lay in wait through the journey. A bus tour to and from the iconic Leaning Tower added to the itinerary's charm.
The following day saw the travel agents embark on the first train journey from Florence S.M.N railway station to Milan Centrale aboard the Frecciarossa 9528, a scenic commute of one hour and 40 minutes. The Frecciarossa travels across Italy’s prime cities, namely Northern Torino up to Salerno on the Amalfi Coast at a speed of 360km per hour.
Day two of the FAM saw a journey from Milan Centrale station to Nice Ville covered under the Eurail Select pass, France Rail Pass & sector reservations. This pass provides unlimited travel on the French National Railways (SNCF) either in first Class or second Class. You can travel on all 31,000 kilometres and 4,000 stations of the SNCF network on either their scenic trains of the TGV.
The following day’s Nice Ville to Marseille St Charles station journey was covered aboard the TGV Lyria 9750 in a duration of 2 hours and 32 minutes under the France Rail Pass & sector reservations. TGV stands for “Train à Grande Vitesse”, High Speed train in French. TGV offers high-speed train services connecting the major cities of France. TGV train travels smoothly and silently at speeds over 300 km/h in complete safety.
The Marseille St Charles station to Geneva route was once again covered by the TGV Lyria 9750, which operates on the South of France – Geneva routes. Following a short stop over at Geneva was the journey from Geneva to Interlaken (Via Bern) aboard Train Eurocities 739 and Train Eurocities 1085 covered by the Swiss Pass. The Swiss Pass enables visitors to travel free of charge on the Swiss Travel System’s entire network for periods ranging from four days to one month.
Commencing the journey to Mount Schilthorn, Rail Europe arranged for the group’s baggage to be transferred to Zurich through the Fast Baggage service which offers a same-day baggage delivery between 45 cities and holiday destinations throughout Switzerland, leaving the agents hands free to enjoy the panoramic view from atop one of the highest Swiss peaks.
The Interlaken to Zurich journey via Lucerne was covered by Swiss Pass and Golden Pass Line reservation. Golden Pass Line is the world’s first panoramic train put into service between Montreux and Zweisimmen. It remains the only line in Switzerland offering VIP seating at the front of the train giving a driver’s eye view.
Extending their support to Rail Europe India on this FAM, the Nice, Marseille and Switzerland Tourism Boards designed their itineraries to showcase what can be enjoyed by tourists in their respective cities.
Nice Tourism arranged for a sightseeing tour along the Promenade des Anglais all the way up to the Catle Hill via the Old Town, all aboard the city’s Small Tourist Train. Speaking with T3, Ria Kolembusova, Leisure Development Manager, Nice Convention and Visitors Bureau stated that these were the areas that Nice was trying to promote in the Indian market. When asked about the response from the country, she revealed that Nice was yet to pick up as much as the rest of Europe as a tourist destination for Indians.
Marseille Tourism had a much larger task at hand showcasing the city that is this year’s Culture Capital of the World. Commencing the tour with the basilika Notre Dame de la Garde, the Board went on to give the group a hotel inspection of one of their newer properties, the Sofitel Marseille Vieux Port, which provides its guests the panoramic view of the Marseille seaside. The city’s recent addition, the MuCEM, an extension of their old fort which provides a blend of new and heritage architecture and houses a museum, was also toured. According to the tour guide, Claudine Ramon, the museum has already received over one million visitors since it opened in January.
Cyrille Saboya, Leisure Sales Representative, Marseille Tourist Office and Convention Bureau revealed that, seeing the growing popularity of Marseille among the Indian travellers, the destination is mooting the possibility of joining Atout France at the next India roadshow.
The city’s port was toured on foot while Ludivine Pillot, Marseille Tourist Office and Convention Bureau highlighted the attractions built along the old harbour to showcase the city as Culture Capital. The Board further arranged a boat trip to the National Monument If Castle.
Last but not least, upon arrival in Switzerland, Switzerland Tourism arranged for Hanne Tontsch, Director Marketing & Sales, Schilthorn Cableways to take the group to the peak for a panoramic view of the Swiss Alps. Unsurprisingly, Tontsch commented that the peak, echoing the scenario in the rest of Switzerland, was extremely popular with Indian tourists. The addition of the Bond World, commemorating the 1961 film that was shot at the peak, has been an added advantage in attracting footfall.
The road ahead
Rail Europe continues to have new passes and promotions in the pipeline to fuel Indian bookings. “Switzerland continues to dominate the Indian market. We have launched a new product called Swiss Peaks Pass for travel starting 1 January 2014. In addition, we will have our third edition of the Rail Europe Connexion magazine early 2014 inserted with various magazines. And there will be many more initiatives for the trade as well,” revealed Kothari.
The recently concluded India Travel Mission (ITM) brought together over 40 Australian sellers which included hotels, entertainment groups and tour operators. The common factor binding them all is their strong focus on the India market. Be it through special offers, unique tours or discounted rates, Australian products are all gearing up to attract Indian footfall in every way possible.
The launch of the Air India direct flights to Melbourne and Sydney has drawn a silver lining for the Australian tourism fraternity, which is banking heavily on these new routes for increased footfall from India. And the special offers start with the Indian national carrier itself. Having penned a codeshare agreement with Qantas, the latter will provide Air India passengers 30 seats at a minimum fare for travel within the destination. Even the launch fares between India and Australia are competitive.
Kate Marshall, Director of International Sales – Eastern Hemisphere, Accor revealed that they have added Indian cuisine as part of their initiative to attract footfall from India. “So far, the percentage of Indian bookings at Accor is small, but we are expecting an increase owing to the Air India services. We intend to focus on attracting honeymooners this year, and we are making some of our properties Indian-friendly for the honeymoon segment. Our Fairmont Blue Mountain has been refurbished and is seeing a pickup in Indian footfall,” she said.
Giving a twist to traditional Australian tours, Safir Tours has taken it upon itself to build new itineraries and highlight new experiences by developing cricket tourism. Nayaz Noor, CEO, Safir Tours stated that he wants to bring cricket club teams from India on tours to Australia. “We will arrange coaching, tours and cricket matches. We are in talks with Phillip Islands for the same and will work with them in developing this offering,” said Noor.
Sovereign Hills, which has been gaining momentum among Indian travellers in recent times, registered 7,000 Indian visitors a year, revealed Garry Burns, Director – Marketing, The Sovereign Hill Museum Association. The highlighted gold rush, he added, attracts several MICE travellers from India. The company plans to focus on families from India this year. He further added that their outdoor museum will be their focus for the time being. When asked about his expectations from India, he stated that he perceives a 10 per cent growth in Indian footfall as a result of the Air India flights.
Kingfisher Resorts is offering romantic getaways for three nights at A$499. Dreamworld Parkway offers a Dreamworld and Skypoint combination, and is adding a water park to the offer from next month for no extra charge. Furthermore, they are adding an aboriginal experience to give the product a heritage edge. Last but not least, Sean John, Sales Manager – Korea, India and Middle East, Dreamworld Parkway revealed that their restaurant Billabong now offers Indian cuisine.
Other products are also taking an effort to make themselves visible in the Indian market, even if it is without the benefit of special offers. AAT Kings are rebranding themselves to attract more attention and highlight the USP of the destination. The Emirates Wolgan Valley has been registering a year on year growth in high end honeymooners from India. The property has added Indian cuisine to its offerings, and has provided all-inclusive packages of A$1500 a night, revealed Justin MacMillan, Sales Manager, Emirates Wolgan Valley.
The Merlin Entertainments Group is adding Sea Life to its highlights for the Indian market. Overall, the group’s products welcome 500-1000 pax a month from India through the travel trade. Shannon Bailey, Head of Trade Sales, Merlin Entertainmen
With the value of the Rupee rode tidal waves over the past few months, the outbound travel market has seen a dip in numbers, especially to established countries such as UK and USA. However, the Indian traveller has come too far to back out of the game altogether. The result? South East Asia has witnessed a surge in arrivals and are expecting further gain in the peak holiday season this year.
The journey so far
When tourism research studies churned out their results, all of which highlighted an increase in Indian travel to South East Asian countries, it did not raise too many eyebrows. This was owing to the continuous success these destinations have been facing in their attempts to draw Indian travellers to their land. Ease of access, value for money deals and close proximity have all ensured that the likes of Indonesia, Malaysia, Singapore and Thailand, among others, welcome a continuous flow of Indians.
For instance, Tourism Malaysia revealed that, the Indian market is a significant contributor in visitor arrivals and has proven to be a strong and viable venture for Malaysia. There has been a healthy double-digit increase, in Indian arrivals into Indonesia, and India now stands as the ninth largest source market for inbound tourism to Indonesia. Last year, Thailand received a total number of 1,016,013 tourist arrivals from India, an increase of 11 per cent over 2011.
Impact of the Rupee
According to Sanjay Sondhi, Country Director- Visit Indonesia Tourist Office (VITO) India, tourism to Indonesia is not affected by Rupee depreciation, since Indonesian companies quote in IDR and even IDR has depreciated against US$ hence Indonesia is considered a value for money destination. “The depreciation of the Indian rupee and rising airfares is compensated with the competitive packages available for the destination,” he added.
Sethaphan Buddhani, Director, Tourism Authority of Thailand (TAT), Mumbai office stated that the destination is confident that travel to South East Asia will not be impacted much in the long run as a result of the Rupee fall. “The mindset of the modern traveller has undergone a huge change in recent years wherein the concept of an international vacation has been embedded in their psyche. Thailand has always been a value for money destination with excellent connectivity and range of unique attractions. This coupled with our constant efforts of reinventing ourselves and raising the quality of services offered, provides a strong foundation for sustainable growth,” he said.
Cementing their faith in Indian outbound, Singapore Tourism Board (STB), recently launched a new MICE campaign called ‘Inspire’. Chang Chee Pey, Executive Director – South Asia, Middle East & Africa, STB stated that, even in today’s economy and situation, Indian companies would want to increase their toplines and revenues, making it vital for the destination to have an incentivised programme for the segment. “US and Europe are now too expensive, so they will look at closer destinations, and that is where Singapore will benefit,” he added. In contrast, Manoharan Periasamy, Director, Tourism Malaysia opined that the Rupee depreciation is going through turmoil leading to Indians preferring to travel domestically.
Staying ahead of competition
Be their forecast positive or negative, South East Asian countries have maintained an unwavering faith in Indian footfall. The situation then elevates to each country staying ahead of its game in a bid to woo Indian travellers. 60 per cent of Indians arrivals to Thailand are repeat visitors and hence TAT will be promoting newer regions such as Chiang Mai, Chiang Rai and Khao Yai, Trang, Surat Thani and Koh Samui to attract more and more Indian travellers, said Buddhani.
“We are also looking to tap high-end luxury Indian travellers, especially in the wedding segment. We also have a project called ‘My Own Jet’, allowing customers to book a private jet to come to Thailand. We will also focus on Golf and medical tourism to enhance our product offerings. We believe we have the right range of products to offer to stay ahead of our competitors and satisfy our visitors,” he revealed.
Sondhi stated that, since the beginning of 2013 Indonesia is focusing on a 16 – 7 –16 concept. The concept is focus on 16 international markets, showcasing 7 Tourism USPs of Indonesia and developing 16 new destinations within Indonesia for International markets, in a bid to set the destination apart from its neighbours.
Malaysia, which is targeting 780,000 tourist from India in 2013, is preparing for its ‘Visit Malaysia Year (VMY) 2014’ to draw tourists. “The campaign, which runs for one year, not only promotes Malaysia on an international level but also highlights various pro-active initiatives by the Ministry of Tourism to ensure Malaysians understand the economic benefits of a successful VMY 2014,” Manoharan said.
Working with the travel trade
Being established destinations owes a lot to the Tourism Boards’ work with the travel trade in India, a support that the countries laud and will continue to work closely with. “The travel trade industry is our bloodline. We constantly conduct destination trainings, road shows, and offers on bookings, online training modules, certification courses and direct engagement and awareness campaigns for the trade. We also associate with the key travel trade from across the country for special joint promotions and marketing campaigns and one can expect to see a lot many more initiative participation with the travel community,” said Buddhani.
Tourism Malaysia plans to host FAMs and attractive incentives are planned for travel trade, tour operators and wedding planners, and also promote Indian weddings in Malaysia through affordable travel packages that have been drafted with the aid of Malaysia Airlines and 5-star properties, revealed Periasamy.
“The Indian Travel Trade is very important due to the big size of outbound traveller growth within ASEAN and hopefully more direct connectivity. VITO India jointly with the Ministry of Tourism and Creative Economy, embassy and consulates, airlines and local industry partners conducted various activities like training presentations, familiarisation tours and the most recent Indonesia Sales Mission 2013, to promote the destination and educate the travel agents on Indonesia,” Sondhi concluded.
While the Rupee depreciation has dampened the spirits of the Indian outbound industry, the inbound sector, which had been facing flak in the face of recent negative events, took a turn for the better in the third quarter of the calendar year 2013. India having become a cheaper destination for inbound travellers in the light of European and American destinations becoming more expensive, has led to the travel industry witnessing higher demand for inbound travel, and given them a glimmer of hope for better inbound business going forward. Currently, foreign tourist arrivals in India has been growing at a CAGR of about 7 per cent which is higher than rate of tourist arrivals across world over which has been growing at about 3.8 per cent and overseas tourism in the Asia-Pacific region that has been growing at about 6.6 per cent. The hotel industry also has been grappling with the downturn that has impacted corporate travel. However, the industry is pinning its hopes on the ongoing travel season which is the peak season for inbound and MICE. While domestic business is still their strong suit this year, the Q3 showed inbound travellers’ bookings also adding to their bottomlines.
“This quarter has been a mixed bag with minor top line gains getting eroded by the inflation in costs and reduced traveller spends. We are currently on target for ~70 per cent occupancy nationally, which should approximately give us a 10 per cent premium in most markets. The extraordinary rise in air fares though has removed any rate premium advantage, as the domestic traveller has been forced to spend, thereby reducing the amount available for hotel spends and reducing the length of stay. Metro markets have shown resilience in absorbing increased supply, albeit at reduced rates. This is an early positive sign and augurs well for rate consolidation next year, especially with no massive national supply injections expected over the next 18-30 months,” opined Rahul Pandit, President & Executive Director, The Lemon Tree Hotel Company.
Hotels witness rise in demand
Providing one of the biggest examples of ongoing success in hotels’ business, Shaiful Alam, General Manager, R.K. Sarovar Portico, Srinagar revealed that the property is averaging at 60 per cent occupancy, with India being the main source market..Furthermore, he stated that, provided there are no political issues, he expects the numbers to stay at 60-65 per cent.
The success of a relatively new property in a destination fraught with issues is an ideal window into the rise in demand for the rest of the country. Hyatt Ahmedabad too has seen a steady growth in Q3, fuelled by corporate travellers. According to Girish Ganeshan, General Manager, Hyatt Ahmedabad, the property’s ARR has shown a steady increase in the last quarter.
Suresh Kumar, Chief Executive Officer, Fortune Park revealed that the Q3 performance has been almost stagnant. “While there has been an increase in occupancy, rates have been under stress. Overall, the first nine months of the year have seen a very marginal growth,” he added.
“The 28 Neemrana non-hotel Hotels have consistently performed well in the Q3 of 2013. Although July was a bit slow especially in Uttarakhand, August and September were good months. We have also seen a growth in Ahmedabad, Gwalior, and Rajasthan. While most hotels were complaining of a down, we still experienced an up! However, there has not been any major increase in ARR as we have not increased our rates in 2013,” stated Aman Nath, Co-Chairman, Neemrana Hotels.
As Nath mentioned, destinations such as Uttarakhand were hard hit. As a result, the properties in the state did not witness the success the rest of India started to achieve, both in terms of domestic as well as inbound travel. “The results for Q3 have been affected by the downturn in the domestic economy and also the continued uncertainty in the key overseas source markets. To add to this the wreckage caused by floods and landslides has hurt the Uttarakhand tourism industry in every way possible. While the char dham may take years to recover, even places like Mussoorie and Nainital that were not affected by the disaster are also seeing a steep decline of over 75 percent in tourists arrivals. There is extreme scepticism. We expected higher occupancy and revenues in the third quarter, and expected a weakened rupee to increase foreign visitors to the Indian properties. But the occupancy in places like Dehradun and Mussoorie has gone down by 80 percent. I believe we would be able to improve on that in the fourth quarter, as mostly it has remained a positive quarter for the overall hotel industry,” opined S.P. Kochhar, CMD, Madhuban Group of Hotels.
It is not just conventional hotels that are witnessing a surge in bookings, but also the timeshare accommodations. According to Gaurav Pallial, CEO, Citrus Check-Inns, the company recorded a robust growth in Q3 2013 over the same period last year, with sales up by almost 30 per cent. “In India the timeshare is still a nascent concept. There are some companied who have over promised and now struggle to deliver. Non performance on delivery has resulted in a negative perception in the market. We have built trust and have delivered,” said Pallial.
He further opined that the rising inflation has helped the company’s cost. “People have become more aware of the costs and are willing to invest. They see it now as an attractive proposition. There was a time when Holiday was a luxury. Today’s hectic office schedules and stress have made it a necessity. This business has graduated from being a luxury to a need (still arriving there though). As and when this becomes more pronounced we shall see more growth. To back it India’s middle class continues to grow. Furthermore, rising airfares have only meant that people travel by road,” he added.
There have, of course, been a few properties that have witnessed stagnation or drop in bookings this quarter. The Claridges Hotels & Resorts, for instance, has performed quite well in Q3, but has not recorded much growth over last year, said Oliver C. Martin, Regional General Manager at The Claridges Hotels & Resorts. “Rates have indeed being rationalised, however we have been very steady with rates and have even increased 5 per cent over last year,” he added.
When asked about correction measures that were used in hotels that witnessed a backslide in the Q3 period, Steve Borgia, CMD, INDeco Leisure Hotels stated, “We brought down weekday tariff and raised the week end tariff.Q2 was standstill but Q3 started moving up. Our Q3 of 2013 will be much better than 2012. In fact, there will be a 10 per cent increase. Yes, ARR has dropped. But volumes are up. From 4100.00 of the previous year, we are doing 3600.00.”
Domestic v/s inbound bookings
When asked what their focus has been for the year, most hotels stated that attracting domestic footfall would take precedence over inbound bookings despite the promise that a low Rupee value brings as far as foreign tourist arrivals are concerned. Be it corporate or leisure, all eyes in the hospitality industry seem to be set on the Indian domestic traveller. Raju Bharat, Chairman and Managing Director, Kenilworth Group of Hotels, revealed that the company has seen a surge in domestic bookings. According to him, most of the big players in travel trade have suffered from the de-valuation of Indian Rupee, leading to steep decrease in outbound and sudden increase in domestic traffic.
“80 per cent of our guests are now Indians and we are delighted. We have never positioned our heritage to be showcase first to the foreigners, just because you can fleece more dollars out of them. We have created a niche for Indians at home: affordable, experiential tourism, with 11-tiered pricing for rooms - they pretty much cover the whole range. Neemrana made Indians proud to enjoy their heritage. Our visitors’ book is full of praise from both Indians and foreigners,” said Nath.
Maintaining a balance between the two though, Borgia revealed that, while the thrust on domestic will be as usual, there will be extra effort to reach the inbound market all through October, November and December this year. “2012 was bad for inbound and we are sorry we allowed that. But we are certain that 2013 end figures will be great and we are all set to harness that. After all we are all eating only each other’s pie. Strategies are in place to tap this market,” he added.
Tour operators hope for more
As the adage goes, there are two sides to a coin. While hotels celebrate the upward crawl in numbers, tour operators are a mix bag of responses, with most citing stagnation in arrivals in Q3, but hopes for Q4 to be better in the wake of the weakening Rupee. “The Inbound season is cyclical in nature. The inbound season only begins in Q4 of the calendar year and it is too early to give any answer. Having said that the year 2012 was encouraging for Cox & Kings as we met all our targets set for ourselves in the year,” opined Arup Sen, Director, Special Projects, Cox & Kings.
Sen further stated that the fluctuating Rupee has not had a noticeable impact on inbound numbers. “The rupee has been fluctuating in recent times. While it depreciated against the dollar sharply sometime ago, it recouped some of its losses as well and so we do not see any significant impact. There are two factors at play here. One is those who will embark on their inbound journey will have more discretionary spending power and second is that those who book now will enjoy a slight rate advantage. However, this is not enough to fuel inbound travel,” he added.
Echoing this opinion, Madhavan Menon, Managing Director, Thomas Cook India stated that the Rupee fluctuation is only one aspect of tourism, and there are several others that influence the sector. “I expect that Rupee will impact inbound numbers. If you take a year ago, the rupee was Rs. 53 to US$ 1. It is at 63 today. Rs. 10 is quite a heavy rise. So I think there will be a benefit. We are going to see the inbound tourism grow. I have no doubt about that. We did a dip stick research and noticed that, whenever the Rupee has weakened, the tourist inflow has increased. But having said that, it could take one bomb, one downgrade, one bad politician, to bring it all tumbling down. But I am still keeping my fingers crossed that the numbers increase,” he said.
Sen has, however, begun to witness a trend in foreign tourist demands, which paint a brighter picture for the industry. He commented that people are getting more adventurous and thinking out of the box for India. Customers are exploring new destinations and itineraries through the tour operators, having gained knowledge through online and offline media. “The popular destinations continue to be the Golden Triangle. However, interests in destinations like Kerala have been on the rise. Adventurous amongst them are also undertaking cycling expeditions in Kerala and some other parts of India. Destinations such as Maharashtra have caught the attention of our customers and we believe that in the years to come this will also be a key destination for the inbound traveller.”
No extent of the weakening of the Rupee will help booking numbers without a marketing plan in place. Be it social media, direct to consumer or B2B marketing, but having a strong strategy in place is of prime importance if the industry is to further gain momentum in inbound and domestic travel. For JW Marriott Mumbai, the focus remains to increase recall and loyalty amongst target audience, said Hema Hariramani, Director of Sales & Marketing, JW Marriott Mumbai.
“We are an aspirational brand and hence our strategy is to continue to increase visibility in various mediums - print, electronic, online and below the line strategies, where our target customer is. We are very aggressive on our Social Media as well. Given the number of promotions we host at our property, we have a PR agency, a social media agency and an advertising/creative agency on board with us. We also encourage marketing associations as and when we can, with respect to individual promotions,” Hariramani said.
Philippe Charraudeau, Vice President & General Manager, ITC Grand Chola opined that it is very rare that hotels have a potential to become an institution, and the initial response to the hotel by repeat businesses has given us the confidence that ITC Grand Chola will become an institution in time. Hence, he added, the property’s marketing strategy has been woven around the same so that ITC Grand Chola becomes a destination authority, both in the international and domestic markets.
“We are extremely aggressive in online marketing and have also tied up with a company, who helps us with this and covers all technology angles, including social media, SEO etc. We have already adapted ourselves as per the industry,” said Martin.
Swiss Youth Hostel (SYH), which entered the India market in 2012, are now focusing on raising awareness about the product among the Indian trade to further fuel footfall from the country to their establishments. Speaking with T3, Beatrice Dolder, Business Development Director, Maison de Voyage which is the Sole Representative of Swiss Youth Hostels, stated that, as the product is fairly new in the India market, agents still need to understand the concept of “just not youth and just not hostel” to promote it aggressively.
“More so when one relates to Hostels in India they are of very low standards especially cleanliness as compared to the hostels abroad especially Swiss Youth Hostels and to change that mindset will take time. Awareness is the goal we need to achieve amongst the India market,” she said.
When asked about their focus segment, she added that the company is promoting its offerings in schools in a bid to drive more student traffic and group travellers to the hostel. In addition, she revealed that SYH has tied up with a few agents who will be their preferred agents and help promote SYH in India by packaging it. “Furthermore, we have dedicated sales executives on field who meet with the B2B trade and create awareness on regular basis,” she added.
Going forward, SYH plans to continue to work closely with these preferred agents. In addition, advertising through regular print media, participating in road shows to reach the larger audiences and conducting familiarisation trips for the preferred and potential agents are all on chart for 2014, Dolder concluded.
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