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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.


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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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Jamaica’s Tourism Minister: Use art for community renewal

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Tourism Minister, Hon. Edmund Bartlett, has challenged the local art community to take art out of the educational institutions and art galleries and into Jamaica’s inner city communities as a vehicle of social and economic renewal.

“We need to consider new and innovative approaches to bring art out of Edna Manley into the wider community and bring art out of the Nation Gallery into Trench Town and into Barret Town and Granville and some of the harsher inner city areas,” Minister Bartlett said.

He was speaking at the closing ceremony for internationally acclaimed Jamaican artist Bryan McFarlane’s “New Beginnings” exhibition and the official launch of the Gene Pearson Gallery at The R Hotel, New Kingston, on the weekend.

Internationally acclaimed Jamaican artist Professor Bryan McFarlane (2nd left) discusses his abstract “Like The Weather When It’s Gray” with (l-r) Canada’s High Commissioner to Jamaica, Her Excellency Laurie Peters; Permanent Secretary in the Ministry of Tourism, Jennifer Griffith; R Hotel owner Evan Williams; and Head of Chancery, Nigerian High Commission in Jamaica, Mrs. Anthonia Akunne. The occasion was the closing ceremony for Professor Bryan’s “New Beginnings” exhibition and the opening of the Gene Pearson Gallery at The R Hotel, New Kingston, on Saturday, April 13.

Reiterating a commitment given earlier this month to disburse J$300 million to 63 communities across the country to boost Community Tourism, Minister Bartlett encouraged Jamaica’s artists to use some of the money to develop creative placements in these communities.

Expanding on the idea, he said, “The concept of creative placement might be something that we can borrow. The United States does it quite well by utilizing relic buildings, underused and abandoned playing fields and almost every facility that seems lacking in its asset value within communities to become creative placement centers. It gives a sense of pride and creates a feeling of cultural connection.”

Minister Bartlett said he would like to see the transforming effect that art and culture has on the lives of people demonstrated. “While we reflect on the beauty of this exhibition and the aesthetics that will fill our hearts as we move around, I want us to use this opportunity to think beyond the art. Let us think development, let us think transformation, let us think innovation and see if there is another remedy for the social disruptions that we are having in our communities across Jamaica,” he concluded.

Paraphrasing French poet Gaston Bachelard, Professor Bryan McFarlane said there is immensity in minuteness and “Jamaica, the place where I have most been inspired throughout my life, is immense.”

He encouraged patrons to look at his art and see the “immense kind of spaces and ideas and metaphors and images that are there and try to read them with your heart and institution.”

Professor McFarlane teaches at the University of Massachusetts, Dartmouth in the United States. He has exhibited his work at numerous museums and lectured as a visiting artist at universities throughout the United States, Europe, Africa, Asia, Latin America and the Caribbean, and has won numerous awards.

The 14 pieces exhibited, constituting watercolors and oil on linen, were from McFarlane’s collections and touched on themes when he lived in China, Turkey and Africa.

MEDIA CONTACT: Jamaica Ministry of Tourism, Corporate Communications, 64 Knutsford Boulevard, Kingston 5, Tel: 920-4926-30, Fax: 920-4944

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GCC produces 1.8 million overnight stays in Germany during 2018

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The German National Tourist Board (GNTB) has announced that it will be showcasing a range of key destinations at Arabian Travel Market (ATM) 2019, which takes place at the Dubai World Trade Centre from 28th April to 1st May.

Participants from Germany partnering with the GNTB this year include the ‘Hotel Palace Berlin’; ‘Frankfurt Tourist and Congress Board’; ‘Baden-Baden Tourism Board’; ‘OUTLETCITY METZINGEN’, the State Tourist Board SouthWest-Germany (Baden-Württemberg Tourismus) and the Black Forest Highlands (Hochschwarzwald Tourismus).

The GNTB’s tourism partners covering local tourist boards, luxury hotels, hospitality, retail, spas and theme parks, each has its own unique proposition, whether spring, summer, autumn or winter, emphasising that Germany is a diverse and unique all year-round travel destination.

Underscoring the relevance of ATM to ‘Destination Germany’, Sigrid de Mazieres, Director for the Gulf countries at the German National Tourist Office (GNTO), an affiliate of the German National Tourist Board (GNTB), commented:

“ATM presents us with an ideal opportunity to showcase our wide-ranging tourism offering from dynamic cities to breathtaking countryside with fairytale castles, lush forests and mountains. In addition, there are great family attractions, excellent shopping centres and superb sightseeing opportunities – visitors will be fascinated by the incredible diversity that Germany has to offer.”

The GCC market is Germany’s third-largest non-European source market behind China and the US and is important for Germany. GCC travellers tend to stay an average of 11 nights and spend on average $5,300 per person per trip, significantly more than other international travellers.

According to the latest forecast from the GNTB, GCC nationals visiting Germany are expected to grow to 3.6 million overnight stays by 2030, compared with 1.8 million guest nights from Gulf nationals recorded in 2018, with key markets being UAE, Saudi Arabia and Kuwait.

The forecast increase is being attributed to the collective efforts of all German Tourism stakeholders identifying and accommodating the travel requirements of GCC nationals, not to mention the excellent connectivity provided through flights from the GCC to Frankfurt, Munich, Dusseldorf, Hamburg and Berlin. In Germany’s hospitality and retail sectors, it is common to meet Arabic speaking staff, familiar with Islamic culture and tradition. Hotels offer copies of the Quran and prayer mats on demand, connecting family rooms, plus restaurants serving halal food are easy to find.

Germany’s attraction as a destination of choice for tourists, is further illustrated by the number of visitors recorded in 2018. Last year, Germany’s inbound tourism figures reached record levels for the ninth year in a row. According to the German Federal Statistical Office, there were 88 million international overnight stays recorded (in accommodation establishments with at least ten beds) – an increase of 5% compared with 2017.

According to IPK World Travel Monitor’s annual survey, in 2017, Germany was the top ranked country among European tourists for cultural trips and with 13.1 million inbound business travellers from Europe, it ranked number one as a business destination in 2018.

The German National Tourist Board (GNTB) will be at ATM 2019 stand no. EU5930.

 

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France remains world’s top tourist destination despite ‘Yellow Vests’ nuisance

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According to France’s national statistics institute (INSEE), the number of nights foreign tourists spent in the country’s hotels, campsites and youth hostels reached 438.2 million, marking an increase of nine million visitors against the previous year.

Neither torched shops, nor tear gas on the Champs Elysées during the months of Yellow Vest protests could deprive France of remaining the world’s most visited country by tourists, breaking another record in 2018.

The report excludes numbers for home-sharing platforms such as Airbnb.

The impressive growth was seen in a year “marked by large-scale nationwide social movements on two occasions,” including two months of rolling rail strikes between April to June, and the Yellow Vest demonstrations that started in late November against fuel prices, the high cost of living and tax reforms.

Despite political upheaval in the final months, last year delivered a promising outlook for the country’s tourism industry. In December, the Yellow Vests crisis put a dent in tourism with the number of travelers visiting France falling by 1.1 percent. In Paris alone, the protests dragged down the number of visitors by 5.3 percent.

Among the most visited sights are the Paris-based Notre-Dame Cathedral and the Louvre Museum, as well as the Palace of Versailles.

The rise is largely thanks to non-EU tourists. Visits from the US rose by 16 percent, while arrivals from Japan saw an 18 percent increase.

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