With a population of 1.3 billion the Indian market for outbound travel appeals like a diamond mine for international destinations and product marketeers. According to 2019 projections, by 2030 the middle-class segment is expected to constitute close to 80% of Indian households, which will drive the growth of outbound travel supported by the growing aviation infrastructure. If you are considering entering India, the question remains on how to tap the potential of the market effectively for the products and services that you offer.
Through this article, we will provide a glimpse into the Who, What, Why, How, When and Where of the Indian market.
Indian market is like a continent and not a homogeneous country, buying behavior, travel psyche, and preferences vary hugely between North, East, West and South India.
India is also a very relationship driven market which requires frequent touch points, we believe in buying from a ‘friend’ versus from a professional. The Indian travel industry itself is a very fragmented and unorganized industry with little or no entry barriers making it difficult to identify potential and genuine partners to work with in the trade.
Who is your target customer ? How do they buy ? Where do they go ?
Segmentation of your target clients based on financial, age and maturity of the traveller is important to reach the right customer.
Depending on the products that you offer, you need to analyse if online channels are more influential than offline channels in the client’s decision-making process.
The choice of destinations to visit depends on the travelers' interest which could be based on Natural landscapes or Urban activities around dining and entertainment
36% of Indian consumers are willing to pay more for getting their personalized travel preferences
What are the business segments you can target ? and how do you find the right partners ?
The main business segments in India are in the Leisure FIT, Escorted group departures, Small groups, MICE, Business and VFF (visiting family and friends)
MICE is a high volume low budget segment, however this is a lucrative segment due to the sheer size of the segment
While most large Indian travel companies manage all these segments, it is critical to know key players specialising in specific destinations and niche segments to be able to partner with based on your targets
Luxury travelers are very specific in their demands and will more often than not book through their traditional offline channel
An average Indian visits 2-3 countries while holidaying in North Europe, stays for 12 days and spends Euros 200 per day
What are the regional complexities of the Indian market and how do you approach them ?
There are distinct traits of travelers depending on the region from where he / she comes, decisions are influenced by language, customs, culture, holiday periods and spending propensity, even travel periods are different for different geographical areas depending on holidays and school holidays
There exists a large market beyond Mumbai and Delhi. India has 10 cities with population of 3 million which are also potential markets but often overlooked by new market entrants.
Tier-2 cities have seen faster growth over the last four years with a CAGR (compound annual growth rate) of 16.8% compared with 9.1% in tier-1 cities
How will Covid19 affect future business to International destinations ?
According to a survey by leading travel brand conducted in 2020, about 45% respondents plan to defer International travel to 2021, while 41% were undecided. In the current scenario there will be pent up demand as destinations open.
2022 and 2023 is predicted to be the biggest rebound in international travel in the history of India
Getting vaccinated, obtaining visas and entry protocols are the biggest factors influencing Indian travel decision to other countries.
Countries and tourism offices that are pro-active in the post-covid world would benefit the most from Indian market.
Using the downtime to develop a well-planned product and a focused market strategy will be key to success during recovery phase.
While it is irresistible to avoid the urge to dive into the Indian outbound market, the success depends on factors such as having the right strategy, learning more about the end consumer, choosing the right partners, planning your investments wisely, and minimising the risks involved.
Travbiz Solutions is not a representation company, rather your trusted consultant and partner to help you enter, set up and establish your business in the massive yet complex market, we offer critical inputs to ensure your success in the Indian market place