Logistics

India’s travel market to reach $48 billion by 2020: Google, BCG

Our Bureau Mumbai | Updated on January 11, 2018 Published on July 02, 2017

bl03_vacation   -  Soloma/shutterstock.com

Challenge is to understand individual micro journeys and offer personalised solutions

Indian passenger travel market is projected to grow at 11-11.5 per cent to $48 Billion by 2020 with the biggest contributor, air travel, expected to grow at 15 per cent to $30 billion.

Hotels will grow at 13 per cent to $13 billion by 2020 while railways will remain $5 billion, according to Boston Consulting Group (BCG) and Google India report, ‘Demystifying the Indian Online Traveller’.

Additionally, as more people come online, smartphone penetration increases and use of digital payments goes up, the report estimates that India’s online hotel market will grow to $4 billion with 31 per cent penetration at a CAGR of 25 per cent.

Vikas Agnihotri, Industry Director, Google India, said, “India’s domestic travel market is on an acceleration path. One of the key findings of the report is that by 2020, one in three hotel rooms will be booked online — a clear indicator of the growing importance of digital in travel research, planning and booking. There are several actionable insights for domestic online travel players including the role of mobile and the level of curation and personalisation that Indian travellers are looking for.”

Not an impulse purchase

Demystifying the travel planning journey of the typical Indian consumer, the report shows that for many Indian consumers, a vacation is an event planned in advance as opposed to being an impulse purchase. Consumers typically spend 46 days on an average to plan their trip. They spend 49 minutes online on their travel research and visit as many as 17 touch points during their booking journey.

However, the length of each online session is less than three minutes, due to the ubiquity of mobile. Through their journey, Indian travellers tend to move back and forth across different online channels, checking availability, comparing prices and assessing connectivity.

Abheek Singhi, Senior Partner and Asia Pacific Head of Consumer Practice, BCG,said, “Travel is a high investment — both monetary and emotional category. Technology has led to democratisation of travel through better information and price discovery — and shall lead to 11-11.5 per cent growth in years ahead. The question is “how to address the 17 different touch points of three minutes each over 49 days.The imperative for players is to use technology and advanced analytics capability to understand individual micro journeys and offer personalised and curated travel solutions.”

Input via word of mouth

The report finds that there are several touch points in the consumer journey, including OTA (64 per cent reach), search engines (33 per cent reach) and Maps (26 per cent reach). Advocacy and word of mouth form an important input into the travel booking journey with 76 per cent of people gaining inspiration to travel from family and friends.

Further, reviews and ratings from other users is the single most important criteria to select a certain booking channel. Finally, the research finds that consumers use a mix of online and offline sources of information during their booking journeys. Within online channels, mobile apps are the preferred destination as 49 per cent consumers prefer to use them for research and 44 per cent for booking. Fifty-seven per cent of the consumers believe that online channels give them better deals while 41 per cent find it more convenient for them to book online.

Published on July 02, 2017
This article is closed for comments.
Please Email the Editor