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Indian travelers expected to spend $136 billion by 2021

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The Indian traveler has come of age, spending approximately $94 billion in 2018, on around 2 billion domestic and international trips, helping the Indian travel and tourism industry achieve unprecedented scale.


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The momentum is expected to continue and the industry will grow at a 13 percent CAGR to $136 billion by 2021, according to a report, ‘How Does India Travel’. The report outlines how India spends on travel, the influence of online channels in their purchase journey and potential growth opportunities for travel businesses till 2021.

Deep diving into the $136 billion spends, the report cites a 12 percent growth in transportation ($50 billion), 13 percent growth in lodging ($21 billion) and consumption, which includes spends on shopping, recreation and food, to grow at 13 percent ($65 billion) over the next three years. Additionally, as more people come online, smartphone penetration improves and use of digital payments goes up, the report estimates that Indian travelers will spend an additional $24 billion on online travel bookings over the next three years, a growth from 25 percent in 2018 to 35 percent in 2021.

Online is a significant source of research

Elucidating the planning journey of Indian travelers, both for business and leisure, the report calls out five phases of a customer journey – Interest, Research, Booking, Experience and Sharing. The report states that during key research-heavy phase of interest, research and experience, digital plays a pivotal role with over 86 percent of consumers being influenced by online channels. During this phase, travelers spend their maximum time on search, travel tour provider websites, price comparison websites, and travel articles. Online video too plays a significant role with 21 percent of travelers being influenced by this platform. In the booking and sharing phase, the report states that nearly 60 percent of customers book transport and lodging online, and over 50 percent share feedback online with social media being the dominant platform.

Talking about the market opportunities for online travel players, Vikas Agnihotri, Country Director – Sales, Google India said, “New users perceive that online channels are geared towards the more frequent flyers and experience-oriented travellers; and existing travelers research online but the lack of trust in payments and booking experience make them end up booking offline. If travel players tap these online users through personalised marketing, messaging and travel plans, they can further augment online travel bookings. This can be done by adopting digital technologies to influence customers early in the journey and moving from one-time engagement to ongoing relationships to have a positive impact.”

“There is a perception amongst consumers that online channels are geared towards premium customers, along with a marked distrust around payment and pricing terms. It is imperative for businesses to address these concerns in order to effectively tap into the growing base of users.” Arpan Sheth, partner Bain & Company said.

Decoding the Indian travelers

The report further identified the five cohorts of travelers in India, across business and leisure travel, and categorised each against their online research behavior:

Frequent flyers: Nearly 70 percent of them booked online, cumulatively spent $17 billion in 2018. They make their choices based on convenience, availability, brand preference and past experiences.

Budget business traveler: 86 percent of them researched online whereas only 60 percent book online, cumulatively spent $20 billion in 2018. This cohort makes their decisions based on cost of travel, availability and consultation amongst their personal business network.

Experience-oriented traveler: Around 70 percent of their bookings were done online and cumulatively spent $22 billion in 2018. They extensively research both online and offline for ‘authentic’ experiences and convenience of options; display high loyalty towards preferred brand of airlines or hotels and actively share experiences.

Budget group traveler: 90 percent researched online and 55 percent booked online, cumulatively spent $29 billion in 2018. They make multiple decision-makers in the process and take the final decisions based on minimal cost.

Occasional travel visiting friends/relatives: 92 percent researched online but only 60 percent booked online, spent $6 billion in 2018. They maximize family convenience within a budget and believe online terms and conditions are restrictive.

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Ethiopian Airlines announces flights to Marseille, France

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Ethiopian Airlines announced that it has finalized all preparations to launch a thrice weekly flight to Marseille, France as of July 02, 2019.

Marseille is the second-largest city of France and main city of the historical province.

The flight to Marseille will be dispatched as per the schedule below:

Flight

Number Frequency Departure

Airport Departure time Arrival Airport Arrival

Time Sub fleet

ET 0734 TUE, THU, FRI ADD 23:45 MRS 05:45 ET 787
ET 0735 WED,FRI,SAT MRS 23:05 ADD 06:35 ET 787

Regarding the upcoming services, Group CEO of Ethiopian Airlines, Mr. Tewolde GebreMariam, remarked, “It gives us great pleasure to launch flights to Marseille, connecting France’s second largest city to the over 60 African destinations we serve, through our hub Addis Ababa. We’ve been flying to Paris since 1971, more than 48 years, so we are not new to the market in France. But we are very happy to expand our services closer to the customer in Marseille now. The connectivity we are establishing between Europe and Africa is facilitating trade, investment, tourism and people-to-people ties.”

As we forge ahead on the path of growth and success as envisioned in Vision 2025, we will keep on opening new routes to all corners of the world bringing Africa ever closer to the rest of the world.”

Marseille marks Ethiopian’s 20th destination in Europe. Ethiopian is currently serving 120 international destinations across five continents with young aircraft with average fleet age of five years. It will also bring the number of passenger flights the airline operates to European cities to 61 per week.

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Montréal-Trudeau Airport awarded prestigious 4-Star rating

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Montréal-Trudeau Airport (YUL) has for the first time been awarded a prestigious 4-Star rating under the Skytrax World Airport Star Rating program, joining the ranks of other major world airports. The results obtained from this ranking, considered a benchmark in the global airport industry, stem from an audit conducted last March.

This fourth star recognizes the major investments made in recent years to modernize the airport’s infrastructure and achieve the highest industry standards, as well as employee efforts to enhance the passenger experience day after day.

“In 2018, Aéroports de Montréal challenged itself to obtain a 4-Star Skytrax rating for the YUL site,” said Philippe Rainville, President and CEO of Aéroports de Montréal. “After pushing our limits and raising the bar to improve customer experience, we learned today that the challenge has been successfully met. ADM is extremely proud of the dedication and excellent work done by all employees at the airport and in the airport community.”

In the past year, many initiatives have been put in place to enhance the passenger experience and the fluidity of processes, as well as to optimize terminal maintenance. YUL now has a new team of ambassadors serving passengers, technology-based control and monitoring processes to ensure the cleanliness of facilities, self-service baggage check-in kiosks, and a fifth baggage carousel in the international zone.

The “World Airport Star Rating,” created in 2000, is recognized in the industry as a global benchmark for airport standards. Ratings range from 1 Star to the most prestigious 5-Star rating. Skytrax specializes in ranking international airline organizations and advises airlines and airports around the world on ways to improve the quality of service delivery and facility management.

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Centara identifies technological and social trends that will shape the hospitality industry in the next 10 years

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Global hospitality is at a crossroads. In the last 20 years, technology has transformed every aspect of the guest journey, from online bookings to in-room services to post-stay feedback. But as technology continues to evolve and advance, what will the hotel industry look like 10 years in the future?

In the past, digitalization was largely driven by companies, as new solutions were introduced to enhance efficiency and target customers more effectively. In the modern era however, it is customers who are demanding greater connectivity. This is especially true in the hotel industry, which is driven by modern lifestyle trends and the “always-on” mindset of millennial travelers.

In light of these trends, Markland Blaiklock, Centara’s Deputy Chief Executive Officer, explains his vision for the future of the hospitality industry in the next decade:

“Ten years from now, I’m sure we will look back and see that the hospitality industry changed much more than predicted, and Asia will continue to be a major catalyst for change. This evolution will be part social and part technological, but the overall goal will be the same: to meet and exceed guests’ expectations,” he commented.

According to Mr. Blaiklock, Centara foresees three significant trends shaping its business, and the entire industry, going forward:

Travel and work life will become inseparable thanks to improved technology and faster connectivity. This trend will occur in all countries but will be led by China and the rest of Asia, which are currently driving the growth in overseas travel. The launch of Centara’s new “Meetings Redesigned” MICE initiative will help to accommodate this shift, by allowing companies to be more flexible and creative with their event agendas.

Robotics and artificial intelligence will create hyper-connected hotel experiences. The Internet of Things (IoT) will seamlessly connect every hotel touchpoint, which will be personalized to the unique preferences every guest. In addition, big data insights will enable hotel staff to improve service quality in real time.

Delivering emotional experiences will be the ultimate goal of hotels. As technology takes over, many guests will go in search of authenticity, human interaction and genuine hospitality. The ability to predict and identify human emotions will be key to the success of hotels in the coming decades.

The big question for hoteliers now and in the future will be: how do we successfully integrate technology to improve the guest’s entire journey, whilst also retaining our distinct personality and brand loyalty?

For Centara Hotels & Resorts, Thailand’s leading hotel operator, this balance is at the core of its strategic vision. In the coming years decades, the group will focus delivering warm Thai hospitality in line with the latest social and technological trends to create exceptional customer experiences.

Centara has proven adept at developing new brands that embrace innovation. The most recent example is COSI, which caters for young-minded and tech-savvy travelers with friendly, simple and affordable accommodation and state-of-the-art amenities like smartphone integration, self-service check-in and a 24-hour lifestyle café concept. It is no surprise that this contemporary concept, which made its debut in Koh Samui in 2017, is now a key driving force behind Centara’s expansion strategy.

In many ways, COSI represents the future of hospitality. Its combination of connectivity, comfort and convenience enables guests to blend business and leisure travel, a key trend identified by Mr. Blaiklock. Across all of Centara’s six brands however, the group continues to roll out innovative new digital experiences.

Recent initiatives range from revamping the Centara website and mobile app for a seamless online experience, to launching a new central reservation system and revenue management system for global coordination. The new Chinese language, China-hosted website, social media pages and payment solutions are also positioning Centara to compete successfully in the world’s largest travel market.

Technology, however, is only one element of a successful strategy. Hotel guests will always be human beings, and the majority of humans visit a destination to experience its charm and culture, not to look at a screen. For Centara, the ability to deliver authentic Thai hospitality is something that can never be replaced by technology. By harnessing big data and personalization tools however, hoteliers can enhance every human interaction. Intuitive and rewarding loyalty programs like CentaraThe1 will play a major part in anticipating and delivering tailored experiences.

So digitalization really is the key; by using smart technology to identify and satisfy guest preferences, the hoteliers of the future will be able to create truly bespoke experiences for every guest.

Centara Hotels & Resorts is Thailand’s leading hotel operator. Its 68 properties span all major Thai destinations plus the Maldives, Sri Lanka, Vietnam, Laos, China, Oman, Qatar and the UAE. Centara’s portfolio comprises six brands -Centara Grand Hotels & Resorts, Centara Hotels & Resorts, Centara Boutique Collection, Centra by Centara, Centara Residences & Suites and COSI Hotels – ranging from 5-star city hotels and luxurious island retreats to family resorts and affordable lifestyle concepts supported by innovative technology. It also operates state-of-the-art convention centers and has its own award-winning spa brand, Cenvaree. Throughout the collection, Centara delivers and celebrates the hospitality and values Thailand is famous for including gracious service, exceptional food, pampering spas and the importance of families. Centara’s distinctive culture and diversity of formats allow it to serve and satisfy travelers of nearly every age and lifestyle.

Over the next five years Centara aims to double its size with additional properties in Thailand and new international markets, while spreading its footprint into new continents and market niches. As Centara continues to expand, a growing base of loyal customers will find the company’s unique style of hospitality in more locations. Centara’s global loyalty program, Centara The1, reinforces their loyalty with rewards, privileges and special member pricing.

For more information about Centara, please visit centarahotelsresorts.com.
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How does India travel? Let us count the 94 billion ways

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Bain & Company and Google India are together launching a report on “How Does India Travel.” According to the report, the Indian traveler has come of age, spending approximately $94 billion in 2018 on around 2 billion domestic and international trips. This has helped the Indian travel and tourism industry achieve unprecedented scale, and the momentum is expected to continue with the industry growing at a 13 percent CAGR to $136 billion by 2021, according to a report.

Fueled by digital, Indian travelers are expected to spend an additional $24 billion on online travel bookings over the next 3 years. The report outlines how India spends on travel, the influence of online channels in their purchase journey, and potential growth opportunities for travel businesses until 2021.

Deep diving into the $136 billion spends, the report cites a 12 percent growth in transportation ($50 billion), 13 percent growth in lodging ($21 billion) and consumption, which includes spends on shopping, recreation and food, to grow at 13 percent ($65 billion) over the next three years. Additionally, as more people come online, smartphone penetration improves and use of digital payments goes up, the report estimates that Indian travelers will spend an additional $24 billion on online travel bookings over the next three years, a growth from 25 percent in 2018 to 35 percent in 2021.

Online is a significant source of research

Elucidating the planning journey of Indian travelers, both for business and leisure, the report calls out five phases of a customer journey – Interest, Research, Booking, Experience and Sharing.  The report states that during key research-heavy phase of interest, research and experience, digital plays a pivotal role with over 86 percent of consumers being influenced by online channels. During this phase, travelers spend their maximum time on search, travel tour provider websites, price comparison websites, and travel articles. Online video too plays a significant role with 21 percent of travelers being influenced by this platform. In the booking and sharing phase, the report states that nearly 60 percent of customers book transport and lodging online, and over 50 percent share feedback online with social media being the dominant platform.

Talking about the market opportunities for online travel players, Vikas Agnihotri, Country Director – Sales, Google India said, “New users perceive that online channels are geared towards the more frequent flyers and experience-oriented travelers; and existing travelers research online but the lack of trust in payments and booking experience make them end up booking offline. If travel players tap these online users through personalized marketing, messaging and travel plans, they can further augment online travel bookings. This can be done by adopting digital technologies to influence customers early in the journey and moving from one-time engagement to ongoing relationships to have a positive impact.”

“There is a perception amongst consumers that online channels are geared towards premium customers, along with a marked distrust around payment and pricing terms. It is imperative for businesses to address these concerns in order to effectively tap into the growing base of users.” Arpan Sheth, partner Bain & Company said.

Decoding the Indian travelers

The report further identified the five cohorts of travelers in India, across business and leisure travel, and categorized each against their online research behavior:

  • Frequent flyers: Nearly 70 percent of them booked online, cumulatively spent $17 billion in 2018. They make their choices based on convenience, availability, brand preference and past experiences.
  • Budget business traveler: 86 percent of them researched online whereas only 60 percent book online, cumulatively spent $20 billion in 2018. This cohort makes their decisions based on cost of travel, availability and consultation amongst their personal business network.
  • Experience-oriented traveler: Around 70 percent of their bookings were done online. and cumulatively spent $22 billion in 2018. They extensively research both online and offline for ‘authentic’ experiences and convenience of options; display high loyalty towards preferred brand of airlines or hotels and actively share experiences.
  • Budget group traveler: 90 percent researched online and 55 percent booked online, cumulatively spent $29 billion in 2018. They make multiple decision-makers in the process and take the final decisions based on minimal cost.
  • Occasional travel visiting friends/relatives: 92 percent researched online but only 60 percent booked online, spent $6 billion in 2018. They maximize family convenience within a budget and believe online terms and conditions are restrictive.

However, challenges remain in meeting the expectations of these travelers. Customers perceive online channels geared towards premium cohorts (frequent flyer and experience-oriented traveler), while mass cohorts, with $55 billion in spending, remain underpenetrated. There are about 160 million non-transacting active Internet users in India with only 5 percent of online travelers from Tier-2 or Tier-3 cities. There is a significant (20 percent) difference between the booking rates of premium cohorts and mass cohorts, the latter being also dissatisfied with online channels (~33 percent satisfied) vs. premium cohorts (~42 percent). The second challenge is in penetrating existing users who exhibit 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 (>86 percent online influence) and booking phases (~40 percent offline bookings).

How travel businesses need to adapt to the needs of online consumers

The report cites five major shifts that marketers need to make to market to the online travelers – First, alleviate consumer concerns by improving the booking and payment experience to build a trusted brand and increase adoption. Second, they need to address the negative customer perception issues by mass customization to drive higher share in the segment. They also need to utilize consumer technology to penetrate mass segments (standardize, enable sharing), reach non-transactors (build offline presence), and create new user access.  Moreover, they need to find innovative and frugal ways to package the experience to increase both adoption and retention.  Finally, they need to create a robust digital backend to adapt to customer needs across the purchase journey.

“The contribution of travel and tourism’s spend in India has reached developed market levels, from 6.7percent of GDP in 2013 to 9.4 percent in 2018. This growth, combined with a rapidly growing internet user base and adoption of online bookings will lead to $24 billion in incremental revenues through online channels by 2021. In order to benefit from this trend, businesses need to actively increase new user adoption and increase penetration in the existing user base across the purchase journey.” Joydeep Bhattacharya, partner Bain & Company said.

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