Evolution of the Indian Travel Industry
India, which has the second fastest growing economy in the world after China in terms of GDP, has become a popular business market for online tourism and travel. The country also having the third largest number of internet users after China and U.S, has started using online booking of travel plans more frequently due to its convenience. The e-travel industry contributes to a majority of 88% growth of the Indian e-commerce industry.
Until about two decades ago, a typical Indian traveller would primarily visit pilgrimage destinations, and the only sources for travel planning were references from friends and family, travel magazines and travel agents. That has changed significantly now with a sharp rise in the growth of tourists.
From 1997 to 2016, the number of domestic tourist visits grew by 10 times — from close to 160 million to 1,614 million, as per Market Research and Statistics by Ministry of Tourism. The statistics further reveal that foreign tourist arrivals also grew 5.5 million in 1997 to nearly 25 million in 2016. The one big change that has happened is that a majority of travel planning and booking now takes place online.
The primary market drivers are the increased spending power of the people, growing internet and credit card penetration, governmental initiative to spread tourism, emergence of new online segments and the much anticipated growth in civil aviation market. The major short term restraints in the upcoming trends are the low operating margins and the non-reliability of offline partners. Other factors that require attention are the limited penetration of the service to the urban areas, payment processing issues, cultural barriers and lack of customer willingness, poor industry practices and insufficient tech infrastructure.
The Online Travel Market is estimated to garner $1,091 billion by 2022, registering a CAGR of 11.1% during the forecast period 2016-2022. Online travel providers aim to ease travel planning and bookings for travelers. The online travel market is driven by quick and convenient flight and hotel bookings, rise in customers' trust in online payment, and ability to compare various available travel options. Nowadays, market players are extensively offering travel services through mobile websites and apps, as it is one of the most preferred mediums of travel bookings, particularly among the young professionals
Online travel portals successfully provide a 360 degree virtual tour apart from audio tours, photographs, video reviews and video blogs either put by regular travelers or by the travel agency itself. The pressures of day to day life coupled with the ease of access and booking through online tourism portals have given rise to more spontaneous travels.
By:Mr. Rahul Chauhan, Founder and CEO of RoomsXpert