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Travel players up the marketing ante

05-June-2012
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Travel players up the marketing ante

Summer is in full bloom and it is travel time for many Indians but this summer started with a downer – with the slowing economy, followed by the plunging rupee.

Market predictions had looked positive for the industry. According to WTTC Travel and Tourism Economic Impact 2012, the direct contribution of travel and tourism to GDP in 2011 was Rs 1,689.8 billion (1.9 per cent of GDP). This forecast was expected to rise by 7.6 per cent to Rs 1,818.5 billion in 2012.

M Iqbal Mulla, President, Travel Agents Association of India (TAAI) shared that this year the numbers have come down by 10 to 15 per cent. The reasons cited were – Kingfisher operations that have been reduced and almost paralysed, Air India captains’ strike, the rupee fall and fuel hike.

Marketing strategy for summer of 2012
The travel industry is flush with variety of marketing initiatives by Yatra, MakeMyTrip, Cox & Kings and new players such as Expedia, who are using different routes to lure travellers. With Yatra earmarking Rs 15 crore and Expedia Rs 60 crore, the response seems to be positive.

Yatra’s campaign featuring Salman Khan appears on TV, print and on ground in retail spaces. Pratik Mazumdar, CMO, Yatra said, “Our TVC with Salman Khan was launched on April 1. Now for the summer campaign, we are spending Rs 15 crore.”

Expedia is running a 360-degree campaign with TV, radio, online, and social media, notching up a spend of Rs 60 crore. Every fortnight there’s a new campaign, such as ‘Holiday with Petrocard’ or ‘Free holiday every hour’ and so on. The company had ‘Chuckk de Rajnee’ video on YouTube, which went viral. This is the first year of “aggressive marketing”, explained Manmeet Ahuwalia, Marketing Head, Expedia India.

The strategy for Cox & Kings is to target the consumer with direct advertising, e-mailers, below-the-line activity and also events. They have innovative schemes and packages on offer too. “For the travel industry, summers are peak period when 60 per cent of the business takes place. We expect our business to grow by more than 30 per cent compared to last year,” said Karan Anand, Head-Relationships, Cox & Kings, without disclosing the actual spends.

For MakeMyTrip the focus is on highlighting its USP. “Our messaging across all customer touch-points is focused on bringing out the natural beauty of a particular destination with a strong backing of our special /unique propositions,” said Manish Kalra, Head – Marketing, MakeMyTrip.

Setting aggressive business targets, the company has laid unconventional marketing plans and has done several experiments on the online and offline front.

Summer rush
Despite the dampening economic conditions, what is clear is that those who have committed ad spends are the ones who are doing well. The smaller players may be feeling the pinch.

For Yatra, the domestic holiday business is up 125 per cent. The international business may be affected by the rupee fluctuation, but it continues to grow. “We plan to double the pace over last year, given the strength of our brand and our Salman Khan communication,” said Mazumdar.

Yatra is seeing a 60 to 70 per cent growth in international travel and in certain domains it is over 100 per cent, shared Mazumdar.

The business has surpassed expectations for Expedia, “We are happy with the numbers and are continuing with our spends,” said Ahluwalia.

MakeMyTrip’s consolidated holiday bookings have gone up by 20 per cent, Kalra said.

Karla commented that the depreciation of the rupee has dampened the overall growth in the category. However, the full impact of the currency fluctuation will not be evident immediately because most people plan and book their holidays well in advance.

Since a majority of Indian travellers still plan their annual holiday around key holiday seasons i.e. summer and winter breaks, MakeMyTrip is continuing to witness growth in both domestic and international travel. “However, the pace of growth has been slower than what was the previous forecast due to the overall economic sentiment,” Kalra deliberated.

“It has not impacted travel at all,” said Anand of Cox & Kings. “The response has been good and in domestic destinations, we see a lot of people discovering new destinations in North East India and lesser known places,” he added.

The overall impression is that the travel business continues to grow and Indian travellers are high on holidays. Big players in the travel industry have reason to be upbeat about the season; it is the smaller players who are feeling the pinch.

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