Across the world, the travel industry is in the throes of a massive transformation. Amidst a volatile macro-economic scenario, traveller preferences are rapidly changing. In addition, the industry currently faces inflationary costs, an acute shortage of skilled talent and is increasingly under scrutiny to adopt more sustainable and green ways of operating.
Even as these challenges persist, the industry, which includes aviation, hospitality, and travel services, can take heart in the fact that traveler sentiment remains upbeat. Months of being cooped up indoors during the pandemic has had a profound impact on consumers, reminding them that travel is more than just the trip. Instead, it is about forming human connection. An Industry Consumer Pulse Survey 2023, which surveyed over 10,000 individuals from 16 countries found that 71 per cent of consumers plan to sustain or increase their spending on leisure travel even as they consider limiting spending across most other discretionary categories.
We believe that travel businesses must build a strong digital core to not just stay relevant but also thrive in this scenario and prepare themselves for the next wave of disruption. A robust digital core is imperative to building resilient business operations, boosting employee productivity, tapping new revenue streams, and most importantly, creating memorable experiences for travellers.
There is no ‘one size fits all’ digital approach
As per industry estimates, global airline passenger traffic is estimated to touch 9.4 billion passengers in 2024. Every year, some of the world’s largest hotel chains offer over a million rooms to guests each, and some car rental companies operate a fleet size of over a million cars each. Given the large scale and complexity of operations, and the diversity of operating models, processes and traveler needs, there is no ‘one size fits all’ approach to building a strong digital core.
Let’s look at this in the context of hotel chains. While all hotels want to deliver great guest experiences, select-service brands prioritize efficiency, have minimal workforce, and rely heavily on standardised processes. As a result, they need a Software as a Service (SaaS)-based lightweight workforce management platform and strong operational insights to maximise efficiency. On the other hand, upscale luxury hotel brands tend to prioritize full-service offerings, well-trained staff, and personalized services. They would typically need a best-in-class workforce management platform along with strong data-led personalisation capabilities integrated into a comprehensive CRM solution.Hence, travel businesses must design and develop their digital core and technology strategy in line with their unique requirements. Interoperable platforms and modular systems, cloud-native operating models, a strong data foundation, artificial intelligence capabilities, and security embedded in everything are all essential elements of this strategy.
Cloud capabilities are vital
Travel companies need to build a solid foundation for change, using the cloud to drive resilience and future growth. The Cloud’s inherent on-demand variability and uninterrupted global connectivity enables businesses to handle surges in business demand. A case in point is how Taylor Swift’s ‘The Eras Tour’ catapulted the demand for airline tickets and hotels in cities on the tour circuit. In situations like this, pricing systems need to be agile, capitalize on the demand, and swiftly distribute new rates across the sales channels. Similar nimbleness is also required during phenomenon like the volcanic ash clouds that can completely upend flight schedules at a very large scale. These situations need enhanced compute power and low-latency connectivity that the cloud offers.
Data-led and AI-powered travel operations
Travel businesses are no stranger to AI adoption – they have been applying AI to growth, experience, and productivity related use cases for some years now. It has been proven that leveraging AI at scale can help create personalised experiences, anticipate travelers’ needs, provide real-time assistance, and help travel companies streamline their operations, empower their employees, and reduce costs. The addition of generative AI to the mix has only given a fillip to AI adoption. Generative AI can help travelers curate a perfect family holiday itinerary, enable an airport manager draw up numerous ‘what-if’ scenarios for gate assignments during heavy snow, and assist with optimal staff allocation.
To tackle the unsustainable aspects of tourism, all stakeholders in the ecosystem must collaborate. Travellers can adopt mindful consumption habits. Local authorities have the power to incentivise eco-friendly businesses, while tour operators can educate tourists on the environmental impact of travel choices. Creating comprehensive environmental planning and waste management for eco-sensitive tourist destinations goes beyond strategy.
A recent industry research found that AI-influenced revenue for travel companies more than doubled between 2018 and 2021 and is projected to triple by 2024. However, only 13 per cent of surveyed travel companies used AI to reinvent core parts of the business, which indicates the tremendous potential for AI adoption.
In order to capitalise on this opportunity, travel companies must put in place the right data and AI strategy, infrastructure and platforms that govern how data is captured, managed, processed, and how insights are visualized and consumed. Robust data governance, responsible AI practices and in-grained security are vital. Equally key are building data, digital and cloud skills in the workforce supplemented by new operating models, and data-driven ways of working.
Elevate the Purchase Experience
To appeal to today’s traveller, their omnichannel experience – be it through the web, mobile app or call center – during browsing and booking must be seamless, intuitive, stimulating and personalised. Organisations must focus on transforming their sales channels and offering differentiated product and experiences that deliver value across the customer journey.
While the travel industry has faced many a curve ball over the years, it has successfully reinvented itself time and again. Reinvention, however, is a continuous process, and having a strong digital core is vital to building resilient and future-ready travel businesses and creating outstanding experiences for travellers.
The author is the Managing Director and Lead for Travel industry, Advanced Technology Centers in India, Accenture.
DISCLAIMER: The views expressed are solely of the author and ETTravelWorld.com does not necessarily subscribe to it. ETTravelWorld.com shall not be responsible for any damage caused to any person/organisation directly or indirectly.
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EaseMyTrip.com, a leading online travel platform in India, continues its strong financial performance, reporting INR 1,607.9 million in revenue for Q3FY24, marking an 18.1 per cent year-on-year increase. EBITDA reached INR 653.7 million, up by 10.9 per cent year-on-year, with a Profit After Tax (PAT) of INR 456.6 million, reflecting a 9.5 per cent year-on-year growth. Gross Booking Revenue (GBR) for Q3FY24 stands at 20,260.7 million.
Highlighting financial performance, for FY24, the Revenue from Operations was INR 4,265.3, growth of 28.4 per cent Y-o-Y. The EBITDA stood at INR 1,705.2 million, a 17.9 per cent of Y-o-Y growth and the reported Profit After Tax of INR 1,188.6 million, growth of 15.3 per cent Y-o-Y. This strong performance underscores EaseMyTrip’s continued momentum and further strengthens its position as one of the few profitable new-age tech companies in the industry.
Additionally, the company recorded a GBR of INR 64,226.0 million in 9MFY24, further strengthening its market position. The total number of air bookings (net of cancellations) in Q3FY24 reached 22.6 Lacs. Similarly, hotel night bookings and the other bookings were 91,915 and 2.7 Lacs, respectively. For 9MFY24, air ticket sales (net of cancellations) were 83.7 Lacs.
Furthermore, there were 3.8 Lacs hotel night bookings and 7.7 Lacs in the other bookings.
Following a successful quarter, EaseMyTrip acquired a stake of approximately 13 per cent in ECO Hotels and Resorts, diversifying its portfolio beyond online travel services. This move aligns with the company’s commitment towards organic and in-organic growth and sustainability by promoting environmentally friendly practices within the travel and hospitality sector.
In another significant milestone, EaseMyTrip and the Government of Uttarakhand have signed a landmark Memorandum of Understanding (MOU) during the Global Investors Summit in London. This partnership aims to elevate Uttarakhand’s global tourism appeal. The MOU includes joint marketing campaigns targeting key markets like the UK/Europe, Middle East, Asia, USA/Canada, leveraging EaseMyTrip’s global reach to bolster Uttarakhand’s tourism sector. EaseMyTrip also introduced EasyDarshan, providing curated pilgrimage packages across India. These packages offer hassle-free journeys, encompassing transportation, accommodation, guided tours, and special pujas, prioritizing safety and convenience. Additionally, the launch of “Explore Bharat – Discover the Soul of India” showcased the nation’s rich heritage, culture, and landscapes, targeting overseas travellers.
Notable growth in November 2023, with 136 trips, showcases a positive trend, though the customer numbers were still behind 2019 by 23 per cent. Rama Mahendru, GM- India at Intrepid Travel, foresees matching 2019 revenue, driven by new offerings. Plans on agenda to enhance female tour leadership initiatives as well as new services in MP and north-east.
Furthermore, EaseMyTrip introduced an exclusive subscription program, the EaseMyTrip Platinum, Gold, and Silver Cards, offering luxury travel experiences to High-Net-Worth Individuals (HNI). These cards feature specialized services, benefits, and privileges, enhancing the travel experience for subscribers. EaseMyTrip has been actively cultivating partnerships with various entities to bolster its marketing and collaboration efforts.
Alongside becoming the Principal Sponsors of UP Yoddhas in Kabaddi, the company has extended its reach to the world of tennis as the Official Associate Partner of World Tennis League Season 2. Additionally, EaseMyTrip has entered into a significant collaboration with Vi to extend exclusive propositions related to travel and international roaming, further enhancing its range of services for customers.
Moreover, in this quarter, EaseMyTrip successfully concluded three major sales – the Winter Carnival Sale, Travel Utsav Sale, and Dussehra Travel Sale. These sales offered significant discounts on flights, hotels, holidays, buses, cabs, and more, allowing the company to provide better value to its customers.
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In a recent revelation by global hotel technology giant STAAH, leading travel platforms GoMMT (MakeMyTrip), Booking.com, and Agoda have maintained their supremacy in India’s rapidly growing travel economy. The report highlights the dominance of these channels, emphasising their strategic positioning to capture a significant share of the expanding Indian travel and tourism market.
GoMMT, the owner of Goibibo and MakeMyTrip, has secured the top spot for the sixth consecutive year, showcasing its unwavering influence in the Indian subcontinent. Booking.com and Agoda retained their second and third positions, consistently holding their ground from the previous year.
TravelGuru exhibited notable growth by climbing two spots to secure the fourth position, while Expedia slightly receded to the fifth spot in the ranking.
Shoaib Ali, National Sales Head, STAAH, commented on the significance of these online booking channels, stating, “With their huge reach in the Indian subcontinent and beyond, these online booking channels are well placed to capture their share of the burgeoning Indian travel and tourism market.”
According to reports from Sabre and McKinsey, domestic travel in India has already surpassed pre-Covid levels, and international trips are expected to witness significant growth, projecting an increase from 13 million in 2022 to 80 million in 2040.
STAAH SwiftBook booking engine secured the sixth position, showcasing its continued relevance and year-on-year revenue growth. Shoaib emphasised that despite the resurgence of Online Travel Agencies (OTAs), travellers have shown a sustained inclination to book directly with hotels.
“STAAH’s continued presence in the top 10 online booking channel list is representative of this trend,” added Shoaib.
Mathias Schmid, Senior Vice President, Trip Division, Booking.com provided deeper insights into the company’s vision and the role of the new COE in an exclusive interview with ETTravelWorld. For the Indian market, this translates into scaling the attractions business and adding more relevant products to cater to the unique preferences and travel patterns of Indian users.
Highlighting the resurgence of business travel post-Covid, Global Distribution System (GDS) has reentered the top 10 channels. STAAH GDS and WebBeds secured the eighth and tenth positions, respectively, reflecting the strong demand from the business travel segment. HRS, an online booking portal specialising in business travel, also maintained a position in the top 10 list.Airbnb, the popular online marketplace for short-term and long-term rentals, retained its seventh position, further underlining its influence in the Indian market.
STAAH’s data, representing over 19,000 properties across 90 countries with 350+ integrations, suggests that accommodation providers are adopting a holistic commerce strategy to attract the right guests at the right time. Shoaib concluded, “New and established online channels are making the distribution mix, allowing accommodation providers to be booked according to evolving seasons and updated traveler preferences that span multiple channels.”
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BLS International Services Ltd, a global tech-enabled services partner, has reported its unaudited consolidated financial results for the quarter and six-month period ending on September 30, 2023.
In the quarter ending September 30, 2023, BLS International recorded a 14.3 per cent year-on-year growth in consolidated revenue, reaching INR 407.7 crore. Notably, the company’s operating EBITDA also saw substantial growth, increasing by 52.7 per cent to INR 86.7 crore.
The company has attributed this strong financial performance to a more favourable business mix, especially within the Visa & Consular services segment, which has consistently contributed to EBITDA margins exceeding 20 per cent.
The company’s consolidated Profit Before Tax (PBT) also witnessed an upswing. In Q2 FY24, the PBT surged over 16 times, reaching INR 766 million, as compared to a mere INR 49 million in Q2 FY23. The upward trajectory extended over the first half of the fiscal year, with the Group’s consolidated PBT for H1 FY24 reaching INR 1,774 million, compared to INR 26 million in H1 FY23.
Additionally, several key growth drivers contribute to the company’s success, including the reopening of travel and tourism destinations, securing new contracts and tenders in the pipeline, increasing demand for value-added services, and potential opportunities in Visa and Consular and Digital Services segments, stated BLS. In a year-over-year comparison for Q2FY24 and Q2FY23, BLS International reported a 14.26 per cent increase in operational revenue, reaching INR 407.74 crores, driven by growth in both Visa & Consular services and the digital business.
For the first half of FY24 compared to H1FY23, operational revenue saw a substantial growth of 25.66 per cent, reaching INR 791.22 crores, up from INR 629.66 crores in the prior year. EBITDA reached INR 166.79 crores in H1FY24, up by 88.90 per cent from INR 88.30 crores in H1FY23. PBT for H1FY24 amounted to INR 167.62 crores, representing an 89.11 per cent increase compared to INR 88.63 crores in H1FY23. The PAT for the first half of the fiscal year reached INR 152.99 crores, showing an impressive 87.28 per cent year-on-year growth compared to INR 81.69 crores in H1FY23.
The company said it maintains a debt-free status with approximately INR 687 crore in cash reserves. Additionally, the asset-light nature of the business has enabled impressive returns for shareholders, with a Return on Capital Employed (ROCE) at 35.5 per cent and a Return on Equity (ROE) at 34.6 per cent based on the annualised financials of the first half of FY24.
In Q2 FY24, traditionally the weakest quarter, the airline reported a profit of INR 8,061 million, excluding foreign exchange loss. Even after considering the foreign exchange loss of INR 6,171 million, the net profit for the quarter aggregated to INR 1,889 million. Compared to the same period last year, the airline saw a significant increase in capacity, with a surge of 27.7 per cent.
As per the current data, BLS International Services Ltd is one of the world’s top three Visa & Consular Services companies, processing Visa applications for numerous countries, including Spain, Italy, Portugal, Germany, Thailand, Hungary, Morocco, India, Vietnam, Malaysia, and Slovakia. The company is pursuing contracts and tenders for visa services worldwide, anticipating growth through new agreements.
In recent developments, BLS International secured a Schengen Global Visa Outsourcing Contract for Slovakia in 18 countries, further expanding its responsibilities to include national visa services in addition to Tourist and Business visa services. The company also partnered with Kotak Mahindra Bank to revolutionise Indian banking, focusing on providing accessible and affordable banking services in underserved areas across multiple states in India.
Additionally, BLS E-Services integrated UMANG Services into its digital platform, offering convenient access to over 500 e-governance services. Also, BLS International extended its Visa outsourcing services to Hungary and Italy Missions in various countries.
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MakeMyTrip Limited, India’s leading travel service provider, has released its unaudited financial and operating results for the fiscal second quarter ending September 30, 2023. Despite seasonal challenges, the company has reported robust year-on-year revenue and profitability growth, driven by strong travel demand across various categories.
The company recorded Gross Bookings of USD 1.839.7 million in Q2 FY24, a substantial increase of 23.8 per cent in constant currency compared to USD 1,514.7 million in the same period last year (Q2 FY23). According to IFRS (International Financial Reporting Standards), the company reported revenue of USD 168.7 million in Q2 FY24, reflecting a remarkable 32.8 per cent year-on-year growth compared to USD 131.3 million in Q2 FY23.
Segment-wise performance:
MakeMyTrip‘s various segments contributed significantly to its strong financial performance. The Air Ticketing segment reported revenue of USD 80.3 million, while Hotels and Packages generated USD 75.7 million. Bus Ticketing recorded USD 21.8 million, and other services contributed USD 11 million in revenue.
Profit and margin:
The company’s EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) for Q2 FY24 stood at USD 13.5 million, compared to USD 10.7 million in Q2 FY23. Remarkably, MakeMyTrip reported a profit of USD 2.0 million during this period, in contrast to a loss of USD 6.8 million in Q2 FY23.
The first half of the fiscal year (H1) for IHCL was equally impressive, as it continued to deliver exceptional results. The revenue for this period reached INR 2,997 crores, demonstrating a substantial 17 per cent YoY increase. The EBITDA registered at INR 862 crores, reflecting a notable 19 per cent YoY growth, along with an expansion of 0.4 basis points in the EBITDA margin. The Profit After Tax (PAT) for H1 reached INR 389 Crores, marking a remarkable 34 per cent YoY growth.
Expansion and acquisitions:
MakeMyTrip continues to enhance its service offerings and expand its presence in the market. On October 31, 2023, its wholly-owned subsidiary, MakeMyTrip (India) entered into an agreement to acquire a majority interest in Savaari Car Rentals, a renowned provider of inter-city car rental services in India. This strategic acquisition is set to be finalised by December 31, 2023, and is expected to bolster MakeMyTrip’s footprint in the inter-city car rental market within India.Commenting on these impressive results, Rajesh Magow, Group Chief Executive Officer, MakeMyTrip, stated, “Despite the seasonal challenges typically associated with the second quarter of the fiscal year, we are delighted to report strong year-on-year revenue growth and an expansion in Adjusted Operating Profit. Our ability to deliver innovative travel solutions, our brand strength, and our commitment to delivering superior value to our customers and partners continue to drive our profitable growth.”
The travel demand in various categories remained robust, with both Gross Bookings and profitability experiencing notable growth in this quarter, highlighting MakeMyTrip’s resilience and its ability to thrive even during seasonally challenging periods.
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Leading corporate travel services provider and online travel company, Yatra Online has reported robust financial results for the first quarter of fiscal year 2023-24. The company said it displayed remarkable growth across various key financial metrics, underscoring its resilience and strength in the travel sector.
The company recorded consolidated revenue from operations totalling INR 1,102 million, reflecting an impressive year-on-year growth of 24 per cent. In addition, Yatra‘s EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) reached INR 177 million, signifying a substantial 28 per cent increase compared to the previous year.
The company maintained an EBITDA margin of 16 per cent, demonstrating a noteworthy year-on-year improvement of 47 basis points. Yatra’s net profit for the quarter stood at INR 60 million, marking a 3 per cent year-on-year growth in this key financial metric. These financial highlights underscore Yatra’s strong performance in the travel sector.
Operational highlights:
Yatra achieved the strongest quarter in air travel bookings since the onset of the Covid-19 pandemic, with the highest number of air passengers booked since December 2019. This growth, up 41.5 per cent YoY, significantly outpaced the domestic air passenger industry’s growth of 14.8 per cent YoY. Yatra’s domestic passenger traffic grew by 6 per cent sequentially, which is double the pace of India’s domestic passenger traffic.
San Francisco is one of the top tourism and meeting destinations in the US and received 21.9 million visitors in 2022. Total tourism spending in 2022 also exceeded USD 7.7 billion. The tourism industry is the largest generator of outside revenue into San Francisco’s economy and supports over 53,000 jobs. In 2022, India ranked third among San Francisco’s top overseas visitor markets with 158,000 visitors.
The company reinforced its position in the corporate travel sector by acquiring 19 new corporate customer accounts. These accounts have an annual billing potential of INR 1,510 million, highlighting Yatra’s strength and leadership in corporate travel services.Revenue from the Hotels and Packages business amounted to INR 448 million, a 17.6 per cent increase compared to the previous year. This growth is attributed to the recovery in domestic travel and the addition of new distribution partners. The company introduced “Yatra Prime” in the Consumer business, featuring benefits like zero convenience fees, access to exclusive fares, and priority access to VIP customer support.
Dhruv Shringi, Whole Time Director & Chief Executive Officer, commented on the results, saying, “We started FY24 on a strong footing, demonstrating our ability to gain market share with remarkable growth in air travel bookings. We’ve fortified our leadership in the corporate travel sector with the addition of 19 new corporate customer accounts, highlighting the capabilities and leadership of our Corporate Travel SaaS platform. As we move forward, we remain optimistic and committed to leveraging these positive trends to drive further growth and success.”
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