Flight Plan

Online traffic has grown in aviation since demonetisation

Ankur Bhatia | Updated on January 16, 2018

online

It is difficult to pick out one specific technology that had a profound impact on the aviation industry in 2016.

But technology is evolving across segments and it had a role to play in the growth of online travel this year. If you see the net numbers, the growth in online travel was much higher than its offline counterpart. India’s online travel segment is expected to grow 17.8 per cent during 2013–2016E, outperforming the overall travel market by six percentage points. Online travel (online gross bookings) now constitutes an estimated 41 per cent of the overall Indian travel market, according to global research and analytics company Aranca. The reason for the growth are the attractive deals that the portals and airlines now offer to customers. And these deals are better than those offered by the travel agents.

Customers are not necessarily loyal to a particular portal or airline, but the lowest prices and offers decide their buying pattern. The rush in online traffic has been aided by the increased usage of desktop and now mobile for bookings. Penetration of mobile internet continues to increase in the country, and the online market’s share is bound to increase.

Since November 8, when the Prime Minister announced demonetisation, additional traffic has been diverted to the online space because of the ease of digital payments.

Big Data mining has helped in increasing the numbers online, especially in customer acquisition and getting repeat visits from them. Now airlines, both in domestic and international markets, are using Big Data to provide customised ticketing solutions to passengers. For instance, airlines will use trends from your past bookings to predict your next holiday and will offer special fares and holiday packages. Airlines will start looking at specific passengers, especially the high-end ones, for this.

Does this mean the future is bleak for offline players? Not so. Their numbers have grown, albeit slower than what has been seen online. And travel agents still play an important role in getting travel papers, such as visa, done. They are required for this.

It is like in any other business. E-commerce companies such as Flipkart and Amazon might be popular and their growth might be higher than that of offline shops. But these offline shops are not getting wiped off.

Going global

As low-cost carriers increase their capacity, they would now like to look into global distribution systems (GDS). These are tools that are used by travel agents for bookings. (IndiGo recently subscribed to a GDS). One would expect more LCCs to do the same to get access to corporate clients that are more valuable. A GDS gives you access to additional travel portals across the world.

In 2017, I expect travel experience to further improve in the domestic market. Already, one doesn’t need to have tags for hand luggage in the biggest airports. Self-boarding will lead to fliers using mobile boarding passes. In the coming years, passengers will have direct access to the aircraft.

(As told to Prince Mathews Thomas)

Ankur Bhatia is Executive Director of Bird Group of Companies, which, among other things, provides state-of-the-art technology and back-end solutions to airlines

Published on December 27, 2016

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