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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.

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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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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The Internet knows you are planning a vacation and will charge you more

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People are starting to plan their summer vacation, and for many, the planning process itself is the beginning of a well-deserved rest. However, it does cause frustration when after a couple of price checks on the Internet, one starts to notice how flight ticket and apartment booking quotes take an upward trend. Such behavior is called price discrimination and is a prevalent tactic across the travel industry, but there are ways to protect yourself from it.

Intuitively unfair, the concept of price discrimination (if not based on race, religion or national origin) is legal and can take many forms. Its general principle is that potential customers get to see different prices of the same product or service based on their willingness to pay as perceived by the seller.

“Many online retailers who use special algorithms to create an illusion of high demand and an increasing price. Let’s say, the quotes for all the hotel rooms you checked yesterday have increased only to encourage you to make a fast decision to book,” explains Naomi Hodges, Cybersecurity Advisor at Surfshark. “The same goes for flight tickets and car rentals so that excellent offer you found an hour ago might have deteriorated to ‘it’s still ok, but I have to hurry’ at your second check.”

Various online businesses are using personalized pricing techniques to manipulate people’s emotions. The leaders in this field, for example, Uber, hire behavioral economists who help to craft the logic of algorithms of differential pricing.

The core ingredient to make the algorithms work is your online data which is acquired when websites insert cookies into your browser and get to know your IP address.

“Such information can reveal where you live, how new or expensive device you use, which websites you visit, what are you interested in, whether you are an easy spender or not, and much more,” says Naomi Hodges.

When your data is being used for personalized pricing, the car rental might become expensive if you already booked a flight to some destination. The same goes for hotel and domestic flight booking.

The price manipulation can go even further by knowing that you are a user of a brand-new iPhone model which indicates higher purchasing power and in turn – your willingness to pay more than other customers.

How to avoid price discrimination?

Naomi Hodges reveals that it is rather easy to check if you are being differentiated from other potential travelers. Taking a few steps can help you save a sum worth a couple of nights at a great hotel or even a return flight ticket if you are an occasional traveler.

If you notice a higher flight ticket/car rental/hotel booking price than before, relax and follow these tips:

  1. Clear your recent digital footprint. You can do that by clearing your browser cache, history, and cookies in the browser settings.
  2. Turn on a virtual private network (VPN) app. This trick can help you change your location by giving you a different IP address. In many cases prices are based on the device’s location, so you can avoid higher prices simply by pretending that you are in another country. Check different countries to see how people there
  3. Turn on Incognito Mode (Chrome), Private Mode (Safari) or Private Window (Firefox) in your browser. This step will allow you to browse cookie-less.
  4. Check the prices using a different device. Differentiating between desktop and mobile users is a common practice.
  5. Change the top-level domain (.com, co.uk, .fr, .net) to a different one. For example, flights4u.com might display different prices than flights4u.de.

Best results can be achieved if all these tips are used simultaneously.

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Centara to showcase traditional Thai heritage through Songkran

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Centara Hotels & Resorts, Thailand’s leading hotel operator, is partnering with Smile in Love Wedding Studio to showcase Thailand’s rich cultural heritage embodied in traditional Thai clothing throughout the upcoming Songkran Festival 2019. Centara staff will wear traditional Thai costumes, providing guests with an up-close look at the timeless style and glamour of authentic Thai apparel. In addition to celebrating Thai clothing traditions, guests at every hotel and resort property across the group will be invited to take part in Thai cultural activities such as the offering of beautiful handmade jasmine garlands and the traditional pouring of scented water over the palms.

Preparations are well underway at all 33 Centara properties within Thailand to extend a warm welcome and Thai-style hospitality to guests soon to arrive from around the world to join the Songkran festivities nationwide. All front-line staff will be dressed in traditional Thai costumes during the upcoming 11th – 15th April 2019 holiday period. Special activities, such as a booth for sprinkling scented water on the Buddha’s image, a set-up for pouring scented water onto elders’ palms, along with traditional Thai folk performances are also being arranged, enabling guests to experience the many appealing facets of this popular annual festival.

As the Thai hotel brand-of-choice among both Thai and international guests, Centara takes great pride in delivering its renowned standard of Thai-style service and gracious hospitality to guests while celebrating an important and joyful cultural occasion together with millions of Thais.

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 centres 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 travellers 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 programme, Centara The1, reinforces their loyalty with rewards, privileges and special member pricing.

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