The Indian travel distribution system is highly fragmented and varied across the country. Whilst there are a few national retail agencies, most agents are small, independent businesses, and contribute a varying percentage of business to Australia. Anecdotally, 10 per cent of agents contribute 20 per cent of the business to Australia, and 90 per cent of agents contribute 80 per cent of business. Indian consumers are researching and booking their trips using a combination of traditional travel agencies and online options, however retail agencies still handle the majority of outbound travel from India.
Wholesalers/ Large Agents
Commission Level: up to 20%
- The traditional wholesale model has not generally developed in the Indian travel industry. There are a few larger travel agents which have developed their own distribution network through smaller independent agents such as Thomas Cook, SOTC, Cox & Kings, MakeMyTrip, Yatra, TUI, FCM/ Travel Tours, etc. These are often referred to as franchisees or preferred sales agents. Some agents and Online Travel Agents (OTAs) have also adopted a model of homebased consultants that include housewives who prefer to work from home.
- The major operators having a pan-India presence are Thomas Cook, SOTC, Cox & Kings, Kesari, Veena World, Club 7, MakeMyTrip, Yatra, JTB Travels, Vacations Exotica, TUI, FCM/ Travel Tours, Mercury Travel, Goomo etc. Most Indian travel companies operate across all segments of travel, including: group tours, Free Independent Travel (FIT), business events and luxury.
- There are a few traditional B2B wholesalers that are gaining support from the smaller retail agents, these include: Rez Live, Fore Travel Representations, GRN Connect, Travel Boutique Online and Amigo Travels. Legacy players in this space include Otilla International (formerly known as Saltours), Goomo (formerly known as Orbitz Corporate & Leisure Travel), and GTA.
Commission Level: up to 15%
- The distribution of travel products in India is fragmented with only a few national operators. Most agencies are small, independent, family-owned businesses.
- Competition between the larger travel agencies is fierce, with aggressive marketing and tactical promotions in print media. Promotions include cash discounts, early bird discounts, hotel upgrades, free holidays on cruises or to other countries/cities such as visits to Canada free on a USA holiday, ‘holiday now, pay later’ schemes, cash back schemes and offers for a companion or child to travel for free.
- Most large retail agents brochure and market their own programs working closely with the inbound tour operators (ITOs).
- Large travel agencies take reservations from consumers through their own retail networks as well as from smaller agencies.
- Travel agents use Global Distribution Systems (GDS) such as Galileo, Amadeus, and GTA, to reduce response time and provide instant confirmations to clients.
- Despite the increase in the online travel segment, traditional retail agencies have not yet moved to this platform for bookings.
- The Aussie Specialist Program (ASP) is the primary platform for Tourism Australia to train and develop front line travel sellers to best sell Australia.
- As at December 2017, there were 3,712 qualified Aussie Specialists in India. 75 per cent of these ASPs are based in the cities of Delhi, Mumbai, Bangalore, Chennai, Hyderabad, Kolkata, Ahmedabad and Pune.
- New potential Aussie Specialist agents are identified in conjunction with airlines, Inbound Tour Operators (ITOs), State and Territory Tourism Organisations (STOs) and travel industry associations.
- In mid-2017 the Australian Department of Home Affairs (formerly Department of Immigration and Border Protection) extended online lodgment of visitor visa applications to all Indian nationals. The online application process provides a more convenient option for Indians looking to visit Australia.
Commission Level: up to 15%
- As the Indian outbound market grows, more consumers are using the internet to research and purchase their holidays.
- Online travel agencies (OTAs) now receive almost 50 per cent of all visits to travel sites, with the top four being Makemytrip.com, Yatra.com, Expedia and Cleartrip. Other international sites such as Tripadvisor, Holiday IQ, Wego, hotels.com, agoda.com, booking.com and Trivago.com are also very popular.
- There has been an increase in online bookings for air tickets for international flights with the improved reach and use of the internet, convenience of booking from home and the removal of credit card fees when booking directly with an OTA or the airline’s website.
- Whilst the online purchase of holiday products is on the rise, most of the OTAs have now established agencies or call centres as an alternate distribution channel.
- Traditional and online distribution systems will therefore continue to co-exist over the next few years as the Indian outbound market grows and matures.
Inbound Tour Operators
Commission Level: 10% - 15%
- Several ITOs are active in India. The number of ITOs catering to the Indian market have doubled over the past three years.
- Key ITOs for India are Wel Travel, Travel Maestro, Holiday Pacific, Australian Outback Travel (AOT), Australian Tours Management (ATM), GTA, Tour East (Qantas Holidays), JTB, Red Apple, Safir Tours, Time Travel, Great Aussie Travel & Tours, Pacific Vacations, Aussie Perth Tours, Aussie Tour Planner, H2Oz Travel, K2K Inbound, Pathfinders Australia, The Leaf – STHI Group, Turtle Down Under, Xplore Australia, among many others.
- Online travel agencies such as MakeMyTrip.com, Yatra.com, Expedia and Ezeego1 have been increasing market share in the online space. They are expanding rapidly, and an emerging trend is their move into traditional retail stores, in addition to expanding products and services online.
- While there has been some growth in online sales of tour packages, the sales volume is still low to date for complete packages sales compared to traditional players and it is primarily for short haul destinations. This is however restricted due to poor credit card penetration (less than 2% of the population) and low average credit limit per person (approx. A$ 1,000)
- Self-drive holidays, luxury holiday experiences and destinations such as South Australia (Adelaide and Kangaroo Island), Northern Territory (Ayers Rock), ACT (Canberra), Western Australia (Perth and surrounds) and Tasmania are new products being developed in the market, with support from Aussie Specialist agents.
Planning and purchasing travel
- Consumers are booking trips using a combination of traditional distribution operators and online options. Most consumers will book through a retail travel agent rather than directly with product.
- India is traditionally a late booking market and consumers have a short lead time for booking holidays, ranging from three to six weeks on an average, prior to the date of departure.
- Indians travellers prefer to plan itineraries and pre-book a majority of activities prior to travel.
- The use of social media for researching travel is higher than some other markets suggesting it would leverage well amongst Indian consumers.
PLANNING A VISIT TO MARKET
TOP TIPS FOR SALES CALLS
- Sales calls should focus on agents in the key cities of Mumbai, New Delhi and Bangalore at least twice a year, and in the secondary cities of Kolkata, Chennai, Ahmedabad, Pune and Hyderabad at least once a year.
- The best time for sales calls is January to February and July to September.
- For more general information on sales calls and planning a visit to market, please see Tourism Australia’s 'Tourism Export Toolkit'.
Key Distribution Partners
Tourism Australia is a partnership marketing organisation and works closely with airlines and travel companies on cooperative marketing to drive conversion in all priority markets.
These targeted travel companies, including wholesalers, retail and online travel agencies, form Tourism Australia’s Key Distribution Partner (KDP) program with the intention to increase total booking value of visitors to Australia.
Each KDP is selected based on the fit with Tourism Australia’s market strategy, a shared target customer profile, shared funding of marketing activity, a commitment to training their frontline sales team through the Aussie Specialist Program and a commitment to selling quality Australian product and experiences.
Below are a selection of Key Distribution Partners that Tourism Australia is partnering with from India.
WHERE TO FIND MORE INFORMATION
Tourism Australia’s activities in India are managed from its Mumbai office. For more information visit Tourism Australia’s corporate website at www.tourism.australia.com.
Australian State and Territory Tourism Organisations operating in India include: Destination NSW, the South Australian Tourism Commission, Tourism and Events Queensland, and Tourism Victoria.
- An overview on the travel distribution system
- A quick reference on key booking and travel periods for markets
- India Country Brief published by the Department of Foreign Affairs and Trade at: www.dfat.gov.au/geo
- For additional statistical reports refer to the ABS and TRA websites, www.abs.gov.au and www.tra.gov.au