India

Usage Patterns

Demographics

Online Travel Market

Travel Planning

Travel sites now attract more than a third of India's total internet population, as more consumers are turning to the web to fulfill their travel planning and booking needs, according to a report by comScore.

The report found that traffic to the travel category (from a home or work location) grew to more than 14 million visitors, aged 15 and older, in April 2010, representing 37% of the total online population and an increase of 50% from the previous year.

With rail transit one of the most prevalent means of travelling through the country, Indian Railways ranked as the most-visited travel site with 7.7 million visitors, up 46% compared to the previous year. OTA MakeMyTrip ranked second with 2.4 million visitors (up 39%) followed by Yatra Online with 1.9 million visitors (up 60%). Several sites experienced triple-digit growth including Travelocity (up 134% to 812,000 visitors), IndiaRailInfo.com (up 340% to 647,000 visitors) and eRail.in (up 160% to 464,000 visitors).

India ranked second among all countries, behind only the UK, in terms of the average time spent per visitor in the category, spending an average of 38.4 minutes per visitor on travel sites during April and consuming 58 pages of content while visiting the category an average of 4 times throughout the month.

Will Hodgman, comScore executive vice president for the Asia-Pacific region, said that with half of all visitors to the category frequenting two or more travel sites during the month, it's clear that consumers are taking the time to diligently compare prices prior to completing their transactions. (eyefortravel, June 2010)

Kerala Tourism has organised a Travel Video Festival on YouTube. Video films depicting the lifestyle, culture, heritage and any other subject on Kerala could be submitted for the award before the end of May 2009 with more than a hundred prizes awaited to be won.

About a year ago, based on an agreement with Google, Kerala Tourism started its branded channel on YouTube (www.youtube.com/keralatourismdotorg). The branded channel has videos highlighting the unique tourism and cultural features of Kerala, featuring promotional movies and documentaries produced by Kerala Tourism. Around one million people have viewed the videos in a span of one year. (Travel Industry Wire, May 2009)

At first glance, the Indian online travel scenario might come across as a market "still waiting to happen", according to an article by Ram Badrinathan, PhoCusWright's general manager, Asia Pacific first published in the Travolution magazine.

Indeed, a number of factors have conspired to limit growth, including: an inadequate supply of hotel rooms, low internet and credit card penetration, and a significantly smaller aviation market than China. Yet despite these very real challenges and limitations, India still has perhaps the most dynamic and innovative online travel market in the entire Asia Pacific (APAC) region.

India's deceptively robust online travel market can be attributed to several conditions; the country boasts the largest travel website in the entire APAC region in terms of transaction volume - the government-owned Indian Railways. Owing in large part to the popularity of rail travel in the country, the website has been a key driver of online travel, e-commerce, and competition across a range of supplier categories.

Another compelling factor that has spurred this growth has been a high level of deregulation, especially when compared to Japan and China. This deregulated retail travel environment has permitted entrepreneurship to flourish, and has taken innovation to new heights. The entry of low-cost carriers (LCCs) into the market in 2005 is perhaps the clearest example of the effects of deregulation. On certain routes, consumers now have as many as eight different carriers from which to choose. This vibrant market has driven competition, much of it taking place online.

But this vibrancy extends beyond competition among air carriers; online travel agencies (OTAs), hotels, bus companies, tour operators, social networking sites and others are all competing to attract and retain Indian travellers. At the same time, India's sophisticated banking infrastructure has laid the foundation for e-commerce in the country. This, coupled with India's tech-savvy, urban population has given rise to an online travel scenario characterized by consumers who have embraced a variety of online travel applications, and are ready to search, shop and book online.

While it is clear that India's online travel market has flourished, this has come despite significant challenges that have limited growth and which still threaten to impede future progress. Chief among these is the poor internet penetration in the country; while the country's middle class has exploded, only about 2% of the population has internet subscriptions. Connectivity speeds are relatively slow, and therefore rich media travel applications have failed to take off. Similarly, mobile travel applications have not gained traction, even though India has one of the largest mobile markets in the world. Credit card penetration is just 2-3% in India, and many consumers are wary about the security of booking online. And many of the country's airports, roads and hotels are badly in need of an upgrade to help the market better realize its potential.

Lastly, India's airlines and OTAs continue to battle it out over the issue of travel agent commissions, instead of focusing on developing a partnership paradigm that is consumer-oriented, and which would exploit underdeveloped opportunities like cross-selling of products, dynamic packaging and more.

Considering these obstacles, it is remarkable how far the Indian online travel market has come. Assuming that some of these challenges will be addressed or mitigated in the coming years, there is little doubt that the outlook for India's online travel market is brighter than ever. (PhoCusWright FYI, May 2009)  

Travel booking

India's travel industry has witnessed a lot of activity in the area of e-payments, according to ZDNet Asia. India's online travel market is predicted to grow by 46% per annum between 2007 and 2011 and generate earnings of US$4 billion by 2011, according to a survey undertaken by market research company eMarketer. (HOTELMARKETING.COM, June 2009)

Travel Industry Online Developments

Social Networking and UGC

Visits to social networking sites in India increased 51% from the previous year to more than 19 million visitors in December 2008, according to comScore. The study also found that global social networking brands continued to gain prominence in India during the year, with Orkut, Facebook, hi5, LinkedIn and MySpace each witnessing significant increases in visitation.

Orkut reigned as the most visited social networking site in December 2008 with more than 12.8 million visitors, an increase of 81% from the previous year. Orkut's audience was three times the size of its nearest competitor in the category.

Top social networking sites in India by unique visitors in December 2008 (total India - aged 15 years old and older, Home/work locations*):
- Total Internet/total audience: 32,099,000 (+22% compared to December 2007)
- Social networking sites: 19,369,000 (+51%)
- Orkut: 12,869,000 (+81%)
- Facebook.com: 4,044,000 (+150%)
- Bharatstudent.com: 3,269,000 (+88%)
- hi5.com: 2,012,000 (+182%)
- ibibo.com: 990,000 (-50%)
- MySpace sites: 741,000 (+110%)
- Linkedln.com: 513,000 (+75%)
- PerfSpot.com: 433,000 (-79%)
- BIGADDA.com: 385,000 (-25%)
- Fropper.com: 248,000 (-3%)

*Excludes visits from public computers such as Internet cafes and access from mobile phones or PDAs.

(comScore, February 2009)