So, is it sheer business acumen on the part of travel agencies who resorted to various innovative methods to promote their offerings to the consumers (For instance, Lifestyle Holidays, a travel agency promoted by brokerage firm Bulls & Bears Finance Ltd., gave an option of buying shares free of cost to travellers in return for packages)? Or is it the market’s pendulum that is helping these agencies get back on the fast track? Well, there are a number of reasons to it. Firstly, during the slowdown, the inbound traffic and domestic tourism in India grew by 30-40% as compared to the outbound traffic. The main reason behind this spur was the aggressive push by the state tourism boards across the country coupled with a sharp fall in tariffs of five-star hotels by 25-40%. An industry expert (who did not wish to be quoted) states, “Travel agencies in India have been able to see a recovery of 10-12% after the slowdown and this is because of the drift in domestic tourism, which has the potential to grow by as much as 500% in the near future with an estimated 561 million domestic tourists travelling in 2009.”
Another factor that has taken some burden off their backs in the midst of the turmoil is E-ticketing. This effective online interface for the travel agencies has certainly highlighted the cost effectiveness of the technology usage in these hard times. In the last two months, more than 50% of the total travellers in India received their ticket by email or fax against 28% customers who still wish to go the conventional way (of doorstep delivery by the agent).
Further, the recent ruling by the Directorate General of Civil Aviation (DGCA), wherein the 24,000 travel agents present in India will be entitled to 3% commission instead of the fee-based model proposed by foreign airlines last year made the travel agencies head faster towards sustainability. For the uninitiated, 14 foreign airlines, including Lufthansa, British Airways, Qatar Airlines, et al, had resorted to a zero-commission model last November and introduced a transaction fee-based model wherein the traveller was made to pay a fee of Rs.250-Rs.5,000 per ticket to the agent subjected to the negotiations of the two parties. “To get away with this new proposal we even boycotted Singapore Airlines and surrendered their ticket stocks. But now since the ruling is in our favour, we expect normalcy to be restored in our operations”, says Datta (who is also an active member of Travel Agents Association of India).
Another factor that has taken some burden off their backs in the midst of the turmoil is E-ticketing. This effective online interface for the travel agencies has certainly highlighted the cost effectiveness of the technology usage in these hard times. In the last two months, more than 50% of the total travellers in India received their ticket by email or fax against 28% customers who still wish to go the conventional way (of doorstep delivery by the agent).
Further, the recent ruling by the Directorate General of Civil Aviation (DGCA), wherein the 24,000 travel agents present in India will be entitled to 3% commission instead of the fee-based model proposed by foreign airlines last year made the travel agencies head faster towards sustainability. For the uninitiated, 14 foreign airlines, including Lufthansa, British Airways, Qatar Airlines, et al, had resorted to a zero-commission model last November and introduced a transaction fee-based model wherein the traveller was made to pay a fee of Rs.250-Rs.5,000 per ticket to the agent subjected to the negotiations of the two parties. “To get away with this new proposal we even boycotted Singapore Airlines and surrendered their ticket stocks. But now since the ruling is in our favour, we expect normalcy to be restored in our operations”, says Datta (who is also an active member of Travel Agents Association of India).
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