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.

Amit Kalsi

Pankaj Nagpal

Lalit Singh

San­jay Kothari

Ankush Ni­jhawan

Sri­ram Ra­j­mo­han

Su­jit Nair

Shra­van Bhalla

Sam­ina Mun­shi

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