Ixigo.com is a travel meta search engine that was started in 2007, and provides travel planning information to consumers including deals, hotels, tickets, places to visit etc, and claims to search 150+ travel related websites to provide search results to the consumers. It was funded by SAIF Partners and MakeMyTrip.com in 2011, with SAIF Partners taking 56.7% stake and MakeMyTrip taking 19.9% stake in the company. In the first part of our interaction, Aloke Bajpai, CEO & C0-founder, Ixigo, he speaks about the effect of the airline industry’s slump on OTAs and others, Ixigo’s insulation strategy against it, business model and mobile strategy.
Effect of Airline Industry’s Slump on OTAs and others
Medianama: How did the airline industry slump affect you last year?
Bajpai: Actually it really didn’t affect us that much. Of course, there was limited growth in the industry this year because of the higher fares and also because of the collapse of one of the airline companies. Because our product is diversified and airline is only one part of it, it has not affected us that much. But the growth has been limited compared to the last 2 or 3 years. The capacity of airline industry has gone down because of Kingfisher. It should come up in the second half of this year because it cant continue to stay low.
Medianama: What did you have to do to insulate yourself from the slump?
Bajpai: We have grown a lot of non-air consumers so dependency on air is limited right now. Our focus is more on travel planning. From end of 2011, we have been trying to be more relevant in a traveller’s journey right from the time he thinks of planning a trip. On Ixigo, you can check places to visit in Goa, restaurants, hotels. There’s lot more to our business now. We also have a powerful transportation engine from anywhere to anywhere in India including trains, buses and taxis.
Medianama: Is airlines still a big earner for the travel industry? Why so?
Bajpai: It still provides the majority for all online companies but all are consciously moving towards packages, hotels etc because of the macro issues in the airline industry. OTAs are looking at holiday packages, tickets etc to move away from air side. Largely, all have done it.The commissions or payouts assured in airlines has become less and the guarantee is also less. If the fares are high and the number of tickets booked are low then companies can’t do anything about it. People have moved away from flights and diversified. For us, we have always positioned ourselves as more of a travel search engine on budget, shopping etc.
Medianama: Which is the category that brings Ixigo maximum business?
Bajpai: It is still largely air and hotels. Flights and hotels are still significantly big. But advertising is also going good so if things go well then advertising can also become a big business for us.
On Ixigo’s Business Model
Medianama: Where does your money come from in the scheme of things?
Ixigo: Our revenue model is based on two main sources. One, on the meta side and lead side, we generate quality search for OTAs sending them leads who end up booking. These OTAs pay us for the traffic conversations we enable. Advertising is the other source of revenue for us. Even large FMCG brands are advertising with us. This is a huge upside given the way the online media spends have been moving in the last 18months.
Medianama: What is the kind of margin that you make on each booking?
Ixigo: It really depends on the kind of relationship we have. We are paid a small percentage of the booking amount or a fixed marketing or booking fee. Most of our hotel relationships are based on per click basis because we are helping them build their brand.
Medianama: What is the volume of international bookings and domestic bookings that you receive on your website?
Ixigo: 20% is International and 80% India centric travel
Role of meta search engines
Medianama: What is the role that meta search engines presently play with respect to the value chain in India?
Ixigo: I think the role we play from a consumers perspective is having an unbiased and comprehensive comparison between hotels. For instance, globally, we have more 2,50,000 hotels listed with us including large hotel aggregators, local OTAs, individual hotels etc. With respect to ticketing, it is about serving the price sensitivity of consumers and their nature of being prudent before buying. All meta search engines are becoming more relevant. Our strong value proposition to the consumer is the ability to make choice. Meta search engines should go beyond and become decision making engines especially with all the divergent information that is available. Ixigo is attempting to help people make these decisions. The other value proposition is to brands selling travel. Meta search engine are able to provide an alternate to Google for customer acquisition. If I’m a hotelier I don’t want to be dependent on one source. I think meta search engine is a cost effective medium for any brand selling travel.
Medianama: How are you handling competition from other players in the industry who especially focus on customized trips?
Ixigo: It is one of the reason why we started building the trip planner. As a consumer, no one is giving me relevant information in one place. People have to go to 7 or 8 websites. It is a difficult process and you spend so much time. What you need is curated information. Relevancy is getting lost with so much information. Google doesn’t have relevancy built from this specific industry’s perspective. We can do that as an exclusive meta search engine. At each decision point, you don’t need too much data. You just need enough to take decision. The thing is knowing what is enough information. So we are trying to make Ixigo go beyond being a meta search engine and help you make decision. You can save all your favorite information and aggregate it in your wishlist then you can go to your destination, open it and visit your favourite places there.
Ixigo’s Mobile Strategy
Medianama: What is the kind of traction that you have got on your mobile app?
Ixigo: Our meta search apps will soon touch 100,000 downloads, all platforms put together. No marketing has been done for it. The number of downloads have increased organically through word of mouth across platforms. Mobile is definitely one of the areas that we are focused on. We were first to move an app in all the platforms. I think we will continue in that way and we want to spearhead it.
Medianama: Why are you launching games and travel planning apps? Does it have anything to do with competition? How do these apps help in your business?
Ixigo: We used to have a FB fan page activity for people to guess a place based on clues. It was quite popular. So we thought why not build an app around the same idea. It was meant to be an engaging inspirational app. I think the direction we are pursuing if we can create relevancy, curiosity for new places, help them discover those places then we are helping you with decision making. Yo India is one of them in that direction. At least one more similar app coming soon.
Medianama: What is the kind of traction that has been seen on your Yo! India game app?
Ixigo: Its very early to have enough traction to talk about right now. That app was built in a 48 hr hackathon. The app came out of the hackathon. We have not done anything on pushing it aggressively. There are more coming very soon.