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Monday, 18 January, 2016, 10 : 00 AM [IST]

Business at glance - how 2015 went by

Though the industry has always proved to be a roller coaster ride, tough and smart decisions have been saving the day. Itee Sharma spoke to industry leaders to find out what 2015 meant for business.
The travel and tourism industry has had a gamut of experiences all throughout 2015. The Indian government paved way to welcome nationals of 113 countries through electronic tourist visa; the surprises of mergers and acquisitions that continued all year long bringing major players under a single umbrella; constant efforts made to boost tourism activities and various events that got the industry together as one big family - overall, the year has been as unpredictable, exciting and enriching as its predecessors were and as much as its successors promise to be.

The travel landscape changed over the last one year. Customer options increased and it was fitting that we also adapted these changes and be one step ahead of the customer. Our focus was on improving customer experience. We also added a number of new products and provided a wide menu of options for the customer to choose from in terms of hotels, airlines, attractions, etc. Delivering a more personalised, contextual experience to the customers and adapting to the changes that come hand in hand with new technologies were the challenges - not only for Ezeego1, but for the industry as a whole. The government has made considerable progress in ease of doing business and is undertaking a large number of tourism infrastructure development.  We are looking forward to enhance B2B distribution into Tier-II and III cities, focus on mobile commerce and international market expansion.

- Neelu Singh, CEO and Director, Cox & Kings Ltd.

The industry witnessed 10%-15% drop in business. India as a destination depends a lot on Europe, and since European market is down it is affecting India. The kind of inbound tourist received wasn’t up to the mark. We should focus on China instead which is the largest outbound generating market. Hotels depending entirely on leisure tourism had a hard time. Overall, it was a difficult time for industry. OTAs have been affecting the business too.  There is unhealthy competition, as OTAs offer discounts way below that the hotels are offering, and hence it is killing the industry. Also, only a tour operator can combine different experience and give a comprehensive package that will ensure repeat customers. At ATTOI, we had decided to focus on experiential holidays and will soon be selling on a single platform all tour operators in 2016. We are currently in the process of deciding the itinerary, for both domestic and international destinations.

- Anish Kumar P.K, President, Association of Tourism Trade Organisations India (ATTOI)

As an official travel agent of the ICC Cricket World Cup we saw huge outbound numbers to Australia. This was followed by the Season Finale of the European Football League and the UEFA Champions League. The European summer was extremely exciting with Wimbledon and Rolland Garros in June and July. The key highlights for us were that we were appointed the only Authorised Ticket Resellers of the RIO Olympics 2016 in India. Fanatic Sports is amongst Asia's leading sports and experiential travel firms. We are the Official Ticketing Agents for ICC, FIFA, Wimbledon, FC Barcelona, UEFA EURO 2016. Sports Travel is yet not completely explored in India, and there are already new entrants in the market increasing competition. The constant devaluation of the rupee has resulted in increasing the travel cost for clients in every manner. At the policy level, India should provide structured platforms to increase inbound tourism by making available single-window clearances to tour operators.

- Anant Roongta (Director) - Fanatic Sports

2015 has seen a few paradigm shifts in the tourism industry as a whole. Backpack holidays, increase in last minute bookings and budget accommodation are amongst the few trends that were witnessed this year. Hotels.com has seen an overall growth of almost 40% on bookings as compared to last year.

Programmes such as Loyalty Rewards and facilities such as Mobile App instant booking have attracted consumers and proven to be extremely successful in the conversion of footfalls per destination, especially with international travellers visiting India. Hotels.com has successfully achieved more than 1 in 3 transactions booked globally on a mobile device. Other trends that have emerged in the past year include ‘Staycations’, more so in the metro cities where travellers make their hotel bookings for a shorter duration of time. Additionally, last minute bookings have increased in the past year and travellers have begun to book hotels that offer comfort and are easy on the pocket. Rio De Janerio, Kuala Lumpur, Hong Kong and Bangkok continue to remain popular international destinations with Indians. In addition, Goa and Jaipur have been all-time favourite Indian for international travellers.

- Amit Agarwal, Senior Marketing Manager, Hotels.com

2015 was one of the most challenging in the history of tourism in India. Each one of us had to revisit our strategies, re-orient our organisation, streamline our process and revitalise our companies to gear up to deal with the challenges. This period has made us look at international markets in a much more serious way and tried to become an integral part of global tourism market. We initiated series of roadshows in new markets hitherto not explored by us with the sole objective of capturing the global opportunity. We also organised know India workshops/seminars and had interaction with overseas tour operators. Enhanced participation in international travel & tourism expo’s was marked by increased number of member’s presence with multiple offers for tourists to experience India. A totally new India destination packages were offered in course of all these promotional activities. It was observed that despite challenges of global uncertainties, India possessed the competitive advantages of cost, diverse products specially quality hotels like palaces and havelis. 

- Subhash Goyal, Chairman - STIC Travel Group & President – Indian Association of Tour Operators (IATO)

2015 was a remarkable year; we launched double daily flights from Mumbai; started freighter flights to Bengaluru, the 4th destination in India; crowned as Employer of Choice 2015 in the categories of Local Attractiveness and Aviation, Logistics and Shipping by Careers in Africa; received the Certificate of Global Growth Company of 2015 from the World Economic Forum; and the all-women functioned flight that operated on the Addis Ababa - Bangkok route was one of the most exciting news. The overall drop both in passenger and cargo market was a challenge. Other challenge was unrest and terrorist attacks in our major African markets, which has impacted the traffic to these destinations. Despite various challenges faced during the course of the year, the size as compared to the previous year, both our passenger and cargo uplift and revenue has grown in July 2014 – June 2015 vis-a-vis the same period last year.

- Tadesse Tilahun, Regional Director India Sub Continent, Ethiopian Airlines

We achieved various significant milestones during the year, including crossing the 200,000 arrivals landmark, AUD 1 billion spend, and improving our ranking to be the 8th largest inbound market for Australia. There’s an increasing interest among Indian travellers to explore newer regions and experiences beyond the traditional gateway cities. The ICC Cricket World Cup brought in up to 15,000 Indians to the Australian shores. India being an extremely fragmented and diverse market, the challenge was to cater to the altering demands and preferences of travellers across different regions in India. In addition, the global economic scenario and the volatility of the Indian rupee also influenced tourism trends to an extent. However, we saw this as an opportunity for us, with the depreciation of the Australian dollar, providing great value-for-money holidays across the country. While currency fluctuations may have some impact on tourism, leisure travel has become an essential part of the urban Indian lifestyle and the demand for travel is continually growing.

- Nishant Kashikar, Country Manager, India & Gulf, Tourism Australia

In September 2015, Astral Travels merged with Quintessentially India Pvt LtdIt was a big opportunity for us to merge with an MNC. However, with the depressing market conditions, doing business was a challenge in 2015. There’s a big requirement for infrastructure upgradation which should be looked upon. Despite the kind of employment opportunities tourism generates, its contribution to GDP goes unrecognised, that should change in 2016. We are now going to focus more on luxury and customised holidays, and experiential travel.

- Kapil Berera, CEO, Astral Travels

The government has taken some progressive steps in 2015. The ETV is a long-term gain. Is the most significant step in a very long time and will definitely show numbers as we move forward. As Prime Minister Narendra Modi visits countries which are relevant source markets to India, initiatives such as these are a good beginning. Such steps are being taken in a phased manner providing the requisite time to settle issues whenever they arise. At PATA Travel Mart in Bengaluru in 2015, we had 80 Indian stalls, people are interested in India, and we had 400 buyers. PATA India Chapter will conduct 2 roadshows in 2016. In the 2015 roadshows we met approximately 475 buyers from India. Apart from that, we will also visit new markets that we have not addressed for sometime to bring destination India into focus.

-Runeep Sangha, Executive Director, PATA India Chapter

In 2015, our business overall improved, driven by high passenger numbers and lower fuel prices. The Cathay Pacific Group reported an attributable profit of HKD 1,972 million for the first six months of 2015. We introduced a new freighter service from Kolkata in March and became the only carrier providing direct freighter services between Kolkata and Hong Kong; and also increased frequencies from 5 to 6 times a week. Globally, Cathay Pacific introduced passenger services to Zurich in March, Boston in May, and Dusseldorf in September. Dragonair started daily flights to Haneda in Tokyo in March and a service to Hiroshima in August. In the first 6 months of 2015, we took delivery of 7 aircrafts - 4 Boeing 777-300ERs and 3 Airbus A330-300s. We enhanced the mobile app for our Indian passengers to enable booking of Cathay Pacific flights. For Dragonair, we launched self-print boarding pass service in Bengaluru in July.

- Rajesh Menon, Regional Sales & Marketing Manager - South Asia. Cathay Pacific Airways

IAAI’s lone crusade in 2015 continued in the constant struggle on ‘travel agents remuneration’, other crucial issues like Lufthansa’s new DCC and IATA’s discontinuation of cheque collections. IAAI is continuing the lone battle for ‘Agency Commission’ through Kerala High Court against DGCA to enforce, execute and implement its own Orders of March 5, 2010 and that of MoCA dated Sept 16, 2013  to which, final hearings are over and the outcome is awaited.  The Default Insurance Program (DIP) would have been the deal substitute for the present insurance guarantee or the proposed ‘dangerous’ Joint Bank guarantee system. IAAI tried to implement it through the IATA Regional office in Singapore, but failed as there was no recommendation for DIP from APJC-India. During the Chennai rain calamity, IAAI was able to get IATA to apply “force majeure” and saved our agent in Tamil Nadu from payment defaults irrespective of their affiliations to any associations.

- Biji Eapen President,IATA Agents Association of India

2015 ended on a great note as we achieved our year-end target of 1,050,000 tourists. India’s significance as a target market was underscored by the visit of Kobkarn Wattanavrangkul, Minister for Tourism & Sports, Thailand. India and Thailand became closer due to the opening of the India-Myannmar-Thailand highway. Thailand made the first ever focused move on attracting Muslim travellers from India. The launch of the 6-month Multiple Entry Tourist for several key markets with a high incidence of repeat travellers will be a boon – and especially in India where people can hop across to Thailand for long weekends. Globally, arrivals have been steadily growing at 2+ million arrivals per month. Indians are looking for newer destinations and we were no longer able to sell them the usual Thai destinations such as Bangkok and Pattaya. We tacked this by bringing newer Thai locations to the table and the response had been very favourable.

- Soraya Homchuen, Director, Tourism Authority of Thailand – Mumbai

2015 has been an excellent year for the travel and tourism industry in India, with strong passenger growth returning to the airline market. This has been catalysed by low airfares, driven by record low oil prices and increase capacity with the entry of new airlines as well as additional aircraft introduced by existing carriers. On the accommodation side, there has been a growing interest among Indian travellers in budget and alternate accommodations. The online travel market has grown ahead of the overall market, both on the air as well as lodging side, with mobile bookings leading the way. Budget category was a segment that put forward a lot of opportunities. Yatra also forayed in the segment with TG Room and Stays which has witnessed a great start. Also, with the ever increasing penetration of mobiles and Internet, capturing the market over the mobile platforms was another key opportunity

- Sharat Dhall, President, Yatra.com

2015 saw the online hotel bookings market opening up due to smartphone penetration and better bandwidth. These were largely driven by same-day or last-minute booking on mobile. In Q2 2016, MakeMyTrip’s India standalone online hotels transactions grew by 168%. Domestic standalone hotel transactions booked via mobile grew at 403% year-on-year basis. Mobile orders share in Q2 was 54% for standalone India hotel bookings. 2015 also saw a strong growth in air passenger traffic fuelled by airlines offering cheaper tickets due to a significant drop in the global oil prices. Leisure travellers benefited hugely with the Airlines flash sales this year. Traffic from mobile apps has grown 250-300% year-on-year in the past couple of years. E-commerce in the country is still largely driven by larger towns and cities. Improvements in the internet infrastructure in these regions will have a deep positive impact on the e-commerce sector at large. The other challenge that sector faced during the year was around finding and retaining the quality talent. Product technology companies are still emerging in the country, resulting in fierce competition among players for high quality talent with relevant skills and experience.

- Rajesh Magow, Co-founder and India CEO, MakeMyTrip

The year was exciting for travel industry and Amadeus. Amadeus introduced the Indian travel industry to the latest and most technically advanced automated products available in international market. Amadeus Ticketless Access solution offered alternative offline methods to book tickets on domestic airlines via Amadeus travel agencies in India. We collaborated with international airlines with presence in the country for full content agreements thus providing our partners worldwide access to the entire range of fares, schedules and inventory. Amadeus also introduced travel intelligence tools such as Amadeus Schedule Recovery that assist in minimising effects of external disruptions.

Additionally, Amadeus Airline Ancillary services saw an 85% increase in the amount of ancillaries being sold via travel agencies. We launched Amadeus Ticket Changer, a first for any GDS in India, which saves time for travel agents when customers require changes to a ticket. We also offered comprehensive and end-to-end products such as the Corporate Self Booking Tools (AETM) & Expense Management Solution and Amadeus Hotels Plus to empower corporates, TMCs and travel agencies alike with analytics on travel spend as well as providing a single interface for hotel booking and minimise errors.

- Rakesh Bansal, CEO, Amadeus India

2015 has been a good year for the Indian office. This year we continued to implement the successful activities that we used in 2014, including educational seminars, tactical co-ops with tour operators and other ongoing initiatives. In addition, in 2015 we undertook several new initiatives which were well-received by our partners.

Indians love California – a record number of Indian visitors to California in 2014 made the Golden State one of the most preferred destinations for Indian travellers in the U.S. The state received 27.2 percent market share to the U.S. and 262,000 Indians visited California last year – an increase of 9.1 percent over 2013. Forecasts indicate 339,000 projected arrivals by 2017. 

As indicated by these results and forecasts, our proactive promotional efforts over the course of 2015 have been successful. Therefore, we plan to continue this momentum by working with and engaging our travel trade and media partners via several innovative programmes. 

The recent launch of the nonstop service between Delhi and San Francisco by Air India, along with the addition of new routes by several other airlines, is boosting connectivity. This – coupled with various other favourable factors, such as ease of getting U.S. Visas – should result in a substantial increase in arrivals from India to the Golden State. 

Leona Reed, Senior Director of International Marketing, Visit California 

2015 has been a great year for travel and 2016 promises to take the experience to a whole new level, with travellers evolving and OTAs coming out with new products to cater to this new breed of travellers. We have seen the evolving Indian travel scenario witnessing very interesting micro-trends Homestay which is contributing largely to the tourism industry. Tourists are willing to explore the destinations and enjoy the local flavours by spending more time. Those looking for a relaxed holiday prefer a homestay and destinations like Kerala, Manali, Himachal Pradesh and Rajasthan are picking up fast on the concept of Homestay.

Manmeet Ahluwalia, Marketing Head, Expedia India

“2015 was a promising year for the aviation industry in India. Changes in policies and discussions to refresh existing regulations presented fresh optimism to the industry. Relaxation in FDI policies allowed foreign investors to partner with domestic players and provide more options and better services to the passengers. Furthermore, new code-share agreements made travel seamless for tourists, both international and domestic. In addition to this, the PPP model saw a major success this year with the inauguration of India’s first greenfield airport project in Durgapur. The model holds great potential for the development of new airports and upgrading existing ones, thereby, improving connectivity significantly. Announcements made during the last two budgets to simplify visa facilities for international tourists coming to India began to be implemented aiding the aviation and tourism industries further. 2016 is likely to see the possible implementation of the Draft Civil Aviation Policy. This will determine the course the industry will take over the next few years.”

Sajid Khan, Country Manager, India, South African Airways.

 
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