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#Outlook15: What Online Travel Companies Plan To Do In 2015

As a part of our #Outlook15 series, we asked online travel companies – iXiGo, MakeMyTrip and TaxiForSure about their focus areas for 2015, and the challenges that the online travel segment needs to address. Answers have been shortened for brevity.

Which according to you were the top developments and roadblocks with respect to the online travel segment in 2014? Why?

Aloke Bajpai, iXiGo

– Growth of mobile, including mobile web traffic, searches & bookings on mobile and app downloads.

Rajesh Magow, MakeMyTrip

– New entrants like Air Vistara and Air Asia in Indian aviation energized the sector that was still battling capacity crunch and expensive airfares in 2013.

– Discounted airline promotions and flash sales introduced a lot of offline fliers to online search and booking.

Raghunandan G, TaxiForSure


– Taxi aggregator segment witnessed a lot of traction on funding from investors in 2014.

– Mobile apps had a significant impact on the online taxi business with customers preferring the use of apps for booking as opposed to other options.

– Introduction of mobile wallet services.

What according to you were some of the changes in the segment from 2013 to 2014?

Aloke Bajpai, iXiGo

– Travelers are increasingly using the internet for searching, comparing, researching and planning before their trips, as they discover how much time and money that helps them save.

– Emergence of startups in niche areas such as activities, short duration tours, travel guides, itinerary management and trip planning.

– Ground transportation as a sector has heated up with some heavy fundraising by all major local players and cut-throat competition for customer acquisition.

– Small and medium sized travel service providers especially small independent hotels, activity providers and local sightseeing service providers are working with OTAs, which has provided them an online presence and enabled them to market themselves better as well as create innovative booking paths to grow their business.

Rajesh Magow, MakeMyTrip

– Online hotel bookings accelerated this year, driven largely by same-day or last-minute booking on mobile.

Raghunandan G, TaxiForSure

– Demand for taxis services grew rapidly in cities, along with geographical expansion into several Tier II cities as well where online taxi services are now well received by the people.

– A point to point market was created in smaller cities where such services did not exist earlier.

– Aggressive pricing by cab companies over the past year led to an increase in short trips taken by customers and also a significant rise in ‘pick now’ bookings compared to ‘pick later’ bookings.

What were the consumption patterns (online & offline) that you observed in 2014?

Aloke Bajpai, iXiGo

Aloke Bajpai

– We have seen the more evolved customer segments moving towards mobile app adoption and spending an increasing amount of time within these apps, leading to great engagement.

– Our app downloads have exceeded 3.7 million and we get over 1.4 million monthly active users from our apps.

– We have witnessed 2.5x growth in overall traffic in the last 12 months, mobile has been one of the key growth drivers for us. Over 4.3 million people now use iXiGo and its app on a monthly basis and this number is increasing by the minute.

– In 2014, nearly 30 million iXiGo-ers planned their trips using our website and apps.  More than 70% of our overall traffic now comes from mobile and only 30% is desktop web. Over 50% of our flight searches and 80% of our hotel searches are coming from mobile too.

Rajesh Magow, MakeMyTrip

– Visitor traffic went up 4x during the busiest day of the first sale in January 2014. 24% leisure travellers took advantage of the cheap fares and indulged in impulse purchase. Again, during the October long weekend, the number of people flying in the first two days (Oct 1-2) was 2 times the average.

– New routes received boost and increased air traffic. During the sale in June 2014, bookings on New Delhi- Port Blair route grew by 850% and bookings on Mumbai- Jammu route grew by 800%.

– Only 1 among the top 10 highest-growing routes was a metro-to-metro connection and took the 10th place (Chennai-New Delhi).

– More than one third of our total online monthly unique visitors come to MakeMyTrip via mobile, which now represents 24% of all online transactions.

– We also witnessed a clear skew towards higher last-minute bookings on mobile. 24% of flight-bookings on mobile app are for same-day or next-day travel (compared to 17% on web), and 52% of domestic hotel bookings on mobile are made 0-1 day before travel (compared to 27% on web).

– Mobile bookings accounted for over 16% of total online transactions for domestic flight bookings and mobile users contributed over 34% of total online domestic hotel transactions.

– Mobile has become a significant channel of access beyond the top 4 metros. People from Pune prefer to access MakeMyTrip though mobile than web, while Ahmedabad, Jaipur and Chandigarh contribute the highest non-metro traffic on MakeMyTrip app.

– Our app downloads grew 3x from 1.5 million in 2013 to nearly 5 million in 2014. Mobile contribution to traffic grew from 20% in 2013 to 33% this year.

Raghunandan G, TaxiForSure

We noticed that the mobile app and online users have doubled in December 2014 as compared to December 2013. There has also been significant increase in app installs from 2013 to 2014.

– Tier II cities have been gaining momentum and have accounted for around 15% of the total app downloads.

What kind of transition have consumers made from offline to online in 2014? Why? What are your observations?

Aloke Bajpai, iXiGo

– Increased smartphone penetration and decreasing price of data plans have led to a greater number of consumers being present online. As travel continues to account for over 70% of total online transactions, online travel companies have benefited due to this.

– Indians took nearly 9 billion train trips this year and train travel is the dominant medium for most Indians as is evident by the huge growth in our trains & budget hotels apps where we are adding almost 6000 new users every single day and do nearly 6 million screen views daily and over 20 million sessions every month.

Rajesh Magow, MakeMyTrip

– Rail continues to be the fastest growing sector in India for online travel bookings, and rail-booking offered on mobile will catapult this growth further.

Raghunandan G, TaxiForSure

– Most people have transitioned directly to the app, skipping online bookings completely. This has been driven by an increase in smartphone penetration and the added convenience of booking cabs at your fingertips.

– The use of wallets has also increased significantly as users prefer to take convenient rides without the hassles of managing cash.

What was something in the online travel segment in India that surprised you in 2014?

Aloke Bajpai, iXiGo

– How Tier II and Tier III users in India have started doing more holiday research and planning online.

– We have even seen growing international travel queries from these smaller towns with Visa rules for Indians being relaxed in many countries with Visa on Arrival facilities.

– Demand for tours and packages from smaller towns such as Indore, Lucknow, Jaipur etc. reflects the growing ambitions of a rising middle class of our smaller towns.

Raghunandan G, TaxiForSure

– The rate at which mobile usage exploded really surprised us. In 2013, the number of users using our app was growing slower than the numbers seen in the broader e-commerce industry. However, in the last few months, we saw unprecedented levels of demand from apps, even in Tier II and III cities.

– Change in consumer behavior towards taxi usage for short distance trips.

– The level of global interest in the taxi industry. While we always believed in the industry, its potential, and our impact in it, what we did not expect was the industry exploding simultaneously around the world and garnering more funding and more news mentions than any other industry.

What are the likely trends that you expect to see in 2015? Why?

Aloke Bajpai, iXiGo

– 2015  will see increased usage of apps, specially on Android, and as we see even the lower to middle-class Indians go online we will see a strong growth in content and services that cater to the middle and bottom of the pyramid.

– The more evolved users will start making more searches and comparisons online, on websites, meta-search engines and trip planning portals.

– We expect that nearly 50% of all online travel bookings in 2015 will happen on or through smartphones.

– In terms of travel behaviour, we will see the search for trendy and offbeat travel destinations intensifying as holidays become more about clicking “braggies” with family and friends, hanging out with the locals, and discovering new destinations. For example, 2014 saw the emergence of Turkey and Sri Lanka as the “cool” destinations worth bragging about. Japan, Singapore & India domestic are likely to be the hot destinations for 2015.

– India will welcome more tourists than ever in 2015, with a more hospitable Visa on arrival policy, development of new airports, and increasing efforts on the part of our government to make India safer for tourists. We should see a rebound in Inbound tourism.

Rajesh Magow, MakeMyTrip

Rajesh Magow_00111

– Mobile will continue to drive the growth of the OTA industry. Mobile bookings will soon overtake bookings through other devices.

– Vernacularization will take center-stage in 2015, in line with the philosophy of offering customized service and experiences.  There is tremendous potential in vernacular content and MakeMyTrip is also investing in creating vernacular travel-booking services.

– Greater segmentation & personalization on flights – Air Vistara has already taken the first step by introducing new segmentation across categories, and more Airlines may follow suit depending on traveller response.

– With e-Visa having been introduced for 43 countries in December 2014, we can expect inbound tourist arrivals to increase significantly. This is a new opportunity for OTAs in India.

– Majority of online travel services in India currently target the young/urban consumer, but we can expect a lot more segmentation in offerings and communication – some examples would be women travellers, corporate travellers, and back-packers among others.

– Wearable technology will enhance the traveller experience, enabling them to find “just-in-time” deals and handy information when they land in a city.

Raghunandan G, TaxiForSure

– In 2015, the industry will see a further surge in short distance trips by customers. Cab availability will also increase further and wait times will significantly decrease for customers. More and more users will adopt the wallet facility. The practice of ridesharing will also gain momentum.

– There will be increased safety measures for commuters by both the Government and the cab industry, in the light of incidents in 2014.

What are the challenges in the online travel segment that would need to be addressed in 2015?

Rajesh Magow, MakeMyTrip

– Bringing the next set of travellers online or on mobile – currently 900 million people have a smartphone in India but are not using data/internet on their phones.

– There are challenges in vernacularizing content for online travel services due to lack of infrastructure and the sheer diversity of dialects and scripts.

There is need to redesign the payments page on merchant and bank’s end to suit the mobile platform, as the number of customers moving to mobile and number of transactions emanating from mobile devices (smartphones, tablet devices) have increased significantly.

Currently, the pages are not responsive or lightweight. While merchants are aggressively making changes to their pages the banks should also match this pace. Banks’ ACS pages (where 2FA authentication takes place) must be redesigned with mobile form factor in mind.

Raghunandan G, TaxiForSure

– The recent incident in Delhi was unfortunate. It highlighted that customer safety could not be left to systems and processes of the past. Customer safety requires on-going innovation, and investments in technological and human resources in equal measure.

– The growth of this nascent industry would depend to a large extent on the regulatory framework that the policy makers put in place.

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