Google India, along with Boston Consulting Group (BCG), has released a comprehensive report on the growth opportunities in India’s tourism and hospitality market over the next four years. The report titled, ‘Demystifying the Indian Online Traveller’ charted the decision making journey of the Indian traveller and provided insights on the potential growth opportunities for travel businesses till 2020. According to the report, Indian travel market is projected to grow at 11-11.5 per cent to US$ 48 billion by 2020 with the biggest contributor, air travel expected to grow at 15 per cent to US$ 30 billion. Hotels will grow at 13 per cent to US$ 13 billion by 2020 while railways will remain largely stagnant at US$ 5 billion. Additionally, as more people come online, smartphone penetration improves and use of digital payments goes up, the report estimated that India’s online hotel market will grow to US$ 4 billion with 31 per cent penetration at a CAGR of 25 per cent.
Speaking about the key findings of the report, 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.”
The report showed that for a majority of Indian consumers a vacation is a well thought through event, the planning for which starts several weeks in advance. The report stated that on average, travel consumers spend 49 minutes spread over 46 days, visiting as many as 17 different online touchpoints to plan, research and make a booking. However, it noted that the length of each online session is less than three minutes, due to the ubiquity of mobile. Through their journey, Indian travellers tend to flip back and forth across different online destinations, checking availability and comparing prices across different providers and connectivity.
Speaking about the opportunities for the online travel players, 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 touchpoints 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.”
Highlighting the purchase drivers, the report has found 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 found that consumers use a mix of online and offline sources of information during their booking journeys. However, only 12 per cent of the consumers prefer to use offline sources for research; 57 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.
