Tier-II & III cities drive outbound market
Outbound tourism industry stakeholders identify emerging trends among Indian travellers: their changing choice of holiday destinations; new outbound market hubs in Tier-II and Tier-III cities; and the various reasons that are leading to these changes.
European destinations were extremely popular among Indians this summer. Greece, Croatia and the UK were the most popular destinations where Indians went to holiday for at least 8-15 nights. The reason for this increase is the ease of obtaining visas for these countries and also reduction in air fares to these destinations due to early-bird offers by airlines. Indians are also increasingly asking for shopping destinations and under this category, Florence, Milan and London remained popular. For the upcoming season, we have received a large number of queries for Australia, New Zealand, South Africa and upcoming destinations like Reunion Island and Fiji. Turkey is likely to pick up among Indians in the following months.
Bali has drawn interest among Indians this year owing to the direct flights and enhanced connectivity from other Indian cities. Philippines, Vietnam and Cambodia have emerged as favourite destinations among Indian families and honeymoon couples owing to low exchange rates. Experiential travel is fast gaining popularity and this segment notches a growth of 15-20 per cent. Rather than visiting the run of the mill places, clients are creating their own, personal, emotion-based memories and destinations like Morocco, South Africa and Eastern Europe are gaining popularity in this segment. Self-drive is now opted by various travellers in destinations like Africa, Australia. Nagpur, Jaipur, Lucknow, Guwahati, Shillong and Tripura are some of the emerging hubs for outbound.
Europe always tops the chart for Indian outbound. This year lots of people showed interest in Central and Eastern Europe with Prague, Vienna and Budapest recording the maximum growth. Iceland has emerged as the most sought-after high-end destination. Unexplored parts of Europe like Romania, Bulgaria and Serbia are generating a buzz among FIT travellers. This is mainly an influence from Bollywood films that are shot in these locations. Cities like Indore, Bhubaneswar Guwahati, Coimbatore, Vizag and Mangalore are some of the cities in Tier-II and Tier-III markets that are doing very good numbers for us.
Though we saw high demand for destinations like Thailand, Singapore, Malaysia, Bali and UAE, it was heartening to record a growth in queries for our new destinations in Eastern Europe including Hungary, Czech Republic, Austria, Bulgaria and Greece. Seychelles too remained in demand along with Mauritius. Bollywood movies have had a big role to play in increasing popularity of destinations like Abu Dhabi and Spain. We see Eastern Europe picking up among Indians as it is more affordable compared to the rest of Europe. We expect demand for Sri Lanka and Maldives to grow with introduction of direct flights from Delhi. Almaty is another destination that we see growing in the coming months.
We have noticed that destinations in Eastern Europe like Prague, Vienna, Budapest and Croatia are doing well among Indian travellers because they are more affordable as compared to other parts of Europe especially the regular itineraries of London, Paris and Switzerland. Some upcoming destinations that we are really excited about are Mauritius, Reunion Island, the Maldives, Greece, Ireland, Spain, New Zealand, French Riviera, Mexico, Peru and Kenya. Indian tourists’ spending power has been estimated to be four times than that of the Chinese or Japanese travellers. The average Indian travellers spends $1,200 per visit as compared to the American or British traveller. Smaller cities like Jaipur, Ahmedabad and Amritsar are emerging as important source markets for outbound travel.
Europe saw maximum growth in 2017 due to value for money air fares and new flight connections, particularly on Air India. New DMCs have opened up which are more flexible on working on more reasonable margins. They are willing to work on servicewise rates, hence, an increased number of outbound players are entering the market as compared to earlier times when the market was dominated by a few DMCs. Europe will continue to generate interest among people and other than that, Maldives and Sri Lanka are other emerging destinations among Indian travellers. From East India, Bhubaneswar and Guwahati are doing great. We are also contemplating to set up an office in Raipur, another growing market.
The outbound tourism industry has grown at a rapid pace despite demonetisation and implementation of GST, and there is a positive sentiment in the market towards travel which is very encouraging. I believe the upcoming season during Navratri and Diwali is very promising. In 2017 summers, Canada was very popular, especially for its Northern Lights. Though Europe remained popular, we witnessed a significant shift in destinations, where Scandinavian countries and Iceland were more popular than the usual European destinations. For the upcoming season, short-haul travel to destinations like Hong Kong, Sri Lanka, Singapore, Kuala Lumpur, Thailand and the Maldives will pick up. Ahmedabad, Pune and Chandigarh are the leading hubs for outbound travel among Tier-II and III cities.
Europe has been popular as always, but the reach is extending to East Europe (Croatia, Slovenia, Romania, Poland, Bulgaria), further to the Baltics and Caucasus. Other specific destinations in Europe like Iceland, Ireland, Portugal, Denmark and Germany have gained interest in past few years and continue to grow. Destination accessibility due to increase in airline connections; easier visa procedures; destination awareness are some of the reason leading to the increased interest. For the upcoming months, South Korea, Taiwan, Philippines, Vietnam and Cambodia are expected to do well. Some other emerging destinations include Central Asia, Morocco, Patagonia (Chile, Argentina), Mexico, Arctic regions for Northern Lights, Antarctica Cruise, Abu Dhabi, Oman, Israel, and Jordan.
Family travel was very popular among Indian travellers this summer. Popular destinations among Indians such as Singapore and Hong Kong topped the charts for us as these are family-friendly destinations and are also easy to reach in less time. Travel decisions these days are driven by children and thus destinations that offer sports and fun activities gain traction. With addition of various tourism products especially offering family-oriented activities, Dubai continues to be a very popular destination. We are looking at huge queries for island destinations like Bora Bora, Tahiti and Seychelles in the upcoming months.