The Travel and Tourism industry, despite contributing close to 10% to the GDP, has been the hardest-hit by the COVID-19 pandemic, leaving many travel-tech startups in the country without business. Tens of thousands of small travel firms around India have barely had any business for nearly a year now. But now, after 10 weeks of falling average daily air passengers through April and May, airline bookings are slowly picking up, as fliers regain confidence and falling infections prompt states to relax restrictions. Moreover, small travel agents have also resumed operations upon easing of Covid19 restrictions, many are now implementing ways like going entirely online.
Online and physical travel agents have seen higher bookings in June. Also, the passenger traffic has picked up in June, but whether this can be sustained will depend on the vaccination drive. In conversation with Financial Express Online, an elite panel comprising of Arun Bagaria, Co-founder, TravClan, Ankush Nijhawan, – Co-founder, TBO Group and MD, Nijhawan Group, Hari Ganapathy – Co-founder of Pickyourtrail, Vivek Anand – Country Head, Mauritius Tourism Promotion Authority and Michael Pargal Lyngdoh – Co-founder of Tripoto discussed how Covid has impacted the travel sector, how travel can bounce back after this jolt, new travel trends like workations, and more. Excerpt:
What will change for the sector post covid?
Arun Bagaria, Co-founder, TravClan: There have been a number of changes in the way travel services are conducted now and in the post-pandemic normal, preference of travellers will change.
- Some of the conventional areas which had been growing healthily in the past such as MICE will witness lesser demand in the short term.
- Due to variations in local rules and restrictions as well as traveller concerns, travel will become more personalized. There is going to be a greater demand for experiential single destination travel. Until international travel resumes normally, the millions of Indian tourists visiting foreign countries will look inbound to explore exotic destinations. We are also going to see a rise in friends and family groups embarking on vacations more often.
- The constantly changing travel scenario is also driving up the demand for professional travel planners who can assist with managing any changes. A major pandemic related development has been an increased demand for privately run quarantine and isolation facilities. This requirement has benefited hotels and will continue to grow. A large number of properties have been converted into isolation centers offering basic medical support, nutrition and remote monitoring for COVID-19 patients with mild symptoms and for those travelling into the country requiring compulsory isolation.
- The demand for international travel is likely to be a lot higher around festivals such as Diwali and Christmas. The government can facilitate arrangements such as Vaccine Passports to bring in the era of truly digital passports/approvals for international travel. A move to allow fully vaccinated people to travel can lead to at least 2x to 3x growth of the business. This will allow streamlining and seamless integration of various entry and visa application processes globally. There is no doubt that the travel operations will thrive and cruise holidays will be back in demand.
Ankush Nijhawan, – Co-founder, TBO Group and MD, Nijhawan Group : “I think vaccine passports or something like that are here to stay for at least a few years which would be a mandatory requirement to cross borders – which is going to be a major shift. Also, I think people would be willing to pay a few dollars extra just to ensure proper hygiene and . Demand for villas, private homes will definitely increase especially in the short term as people would want to be aloof and doing their own thing, rather than sharing restaurants and bars. But, as things progress people would want to socialise but hygiene and sanitisation will definitely remain an important factor for a customer’s decision to stay at a hotel.”
With the recent vaccine drive, how will the business be affected?
Arun Bagaria, Co-founder, TravClan: The vaccination drive augurs well for the travel industry. As more and more people get vaccinated, the travel restrictions can be eased especially for those who have received both the doses. We are hoping that the government will take steps to boost domestic travel and also allow the vaccinated people to travel and help the industry.
Vivek Anand, Country Head, Mauritius Tourism Promotion Authority: Vaccination will play a very important part in the revival of the travel industry. Fully vaccinated travellers and stakeholders will give a confidence boost and encourage more and more people to undertake journeys.
How much time will it take for the travel industry to bounce back?
Arun Bagaria, Co-founder, TravClan: It is not possible to set any defined timelines for the resumption and recovery. A lot of factors come into play when we talk about reviving travel operations. Looking at the way the number of cases has started declining, and the rapid build-up of healthcare facilities as well as vaccination drives, we feel that there will be a strong revival of the travel industry after Diwali, and we will see good traction in international travel around Christmas. The resumption is likely to be a staggered and systematic process which will also be dependent upon different geographies. India in itself is a large country where some states have very high spread of the pandemic and others are comparatively safer. Once restrictions on public movement are lifted, we are likely to witness steady growth of domestic travel in the short to medium term. There is a massive pent up demand for international travel and we expect the market to surpass all past records in 2022.
Ankush Nijhawan, Co-founder, TBO Group and MD, Nijhawan Group: “Realistically speaking, I think from 1st of July some borders should open up for India – countries like Dubai, Maldives and some parts of Europe and other parts of Asia as well. As we keep reading and hearing, fully vaccinated passengers would be allowed to travel globally and that would definitely be a boost to the industry. But I think only 30-35% of international business will come back starting July. The next increase will probably happen around Diwali – between October and December – the business should revive to around 60-70% by this time. I think the pandemic would have settled down, a majority of the population would have been vaccinated and many countries will open for India. 1st of Jan’ 22, life would be back to what it was in 2019 – that’s my take and I really wish this happens for the benefit of all of us”.
How travel agents should invest their time and money as the situation is quite different from last year?
Arun Bagaria, Co-founder, TravClan: The situation this year is different and despite the chaos and unfortunate loss of lives, things are a lot more streamlined now due to the experience we gained from 2020. Unlike last year when nobody knew what was happening, travel agents are now well versed with the pandemic effects and the changing operational environments. This is the time for them to research new products, destinations and services which are likely to attract more customers in the future. Unlike the past, travel transactions will be mostly conducted online and offline travel agents need to integrate technology into their operations to offer digital services to the travellers.
What should travel agents do post-covid towards selling and marketing themselves
Arun Bagaria, Co-founder, TravClan: Travel agents will need to create a strong digital brand presence for themselves. People will seek great personalization and constant digital communication and support from the travel operators. Thus, digital assets such as a feature-rich website, online bookings, digital communication and easy payments/refunds process online will become standard needs of the trade. Agents who are proactive and quick to respond to the travellers’ concerns will generate more business. In the future, the support provided by a travel agent can’t just be limited to Visa assistance and arranging cabs for sight-seeing at the destination. The agent will have to act as a friend and advisor with updates on the travel conditions at the destination. Marketing themselves through social media and offering flexible itineraries, online payments etc is going to make them generate greater business.
With lots of hotels converting to Quarantine centers, how has this impacted business, do travel platforms get a lot of leads and requests for this?
Arun Bagaria, Co-founder, TravClan: Travel agents on TravClan have received a number of inquiries related to such properties especially in April and May as people exhibiting pandemic symptoms showed preference to self-quarantine in order to protect their family members.
Michael Pargal Lyngdoh, Co-founder of Tripoto: Leisure travel has been understandably at a standstill for the last two months so business has been adversely affected. Our focus has been in helping our community navigate through this crisis. We’ve created a separate content hub for COVID related updates and information and have seen a lot of engagement here along with questions across our social channels on availability of hospital beds and medical resources available in different parts of the country. The community has played an important role in helping each other out by verifying and directing those is need to relevant resources.
With the 2nd and the impending 3rd wave are “workations” a new trend gaining consumer interest? What are your observations?
Arun Bagaria, Co-founder, TravClan: Workations had generated a lot of interest during the first wave as well, and the hotels, guesthouses and hostels offering such deals are now well-versed with the economics as well as the operational requirements of workations services. Many of the properties across the country have made arrangements such as high-speed data access, dedicated workstations as well as enhanced sanitization and contact-less services for ‘workations.’
Some of the large organizations in India have shown the inclination to switch to a completely remote working environment. The evolution of such a corporate culture will drive the workations popularity as well. However, these are early days and we need to see if other companies join the remote working ecosystem or not.
Hari Ganapathy, – Co-founder of Pickyourtrail: Workations, we feel may not gain a huge trend. it was great in Wave 1. But with wave 2 and 3, people are also fatigued with working remotely. While there might still be a small percentage of users who might enjoy workations, people are actively seeking a break from their routines. They want to feel pampered, relax and de-stress. As and when unlock happens and it becomes safer to travel, we foresee people taking shorter breaks of 3-5 nights and not just weekend breaks.
Some tips on how to sustain and be innovative to generate new avenues within the sector in order to draw in revenue.
Arun Bagaria, Co-founder, TravClan: The focus of travel companies has to be on service and hospitability to boost their revenue generation. A number of hotels have revamped their offerings and are now providing premium services leading to greater revenues. We are also seeing a surge in pre-book and flexible offers by various hotels at highly discounted prices. However, these offers and initiatives are not adequately supported through marketing, and the industry needs to ramp up the communication and customer engagement to increase sales.
Ankush Nijhawan, Co-founder, TBO Group and MD, Nijhawan Group: “I somehow feel that education — internal and external about vaccines is super super important. Maintaining cash reserves depending on the size of the business to sustain probably for another couple of months before hopefully things settle down and business starts moving. Next would be, use of technology because that’s where operating leverages and scale can happen, work from home can be continued for some more time if need be. Personally, work from home is something I don’t believe in but it can surely help you lower the real estate cost. Look at some other cost cuts – I am not implying salary cuts because one should support employees and staff who’ve been with the company for the last many years but other other expenses which might not be in big amounts but can definitely help us sustain the bottom line.”
Michael Pargal Lyngdoh, Co-founder of Tripoto: I think sustainability of the business comes from being agile. It is important to identify ideas that work and invest accordingly. The pandemic forced the strengths and cracks of all organisations to be revealed, the businesses that survived were the ones who adapted quickly. Innovation of course is the next step to adapting. The key to innovation is to ensure that your employees are empowered to make decisions. If they feel like part owners of the business, they will constantly be problem solving and looking for opportunities; innovation can stem from any business line or any one person in your company. For example, the pandemic made our team come up with brilliant ideas to open new monetisation channels for our community members and keep travellers engaged when they couldn’t really travel. One such initiative is our Online Experiences where Tripoto hosts workshops and masterclasses on all that’s interesting to our users – From travel writing to tips on how to open a mountain cafe.
How travel agents should invest their time and money as the situation is quite different from the last year.
Arun Bagaria, Co-founder, TravClan: Travel agents must spend their time and money on research and technology adoption. Creation of new products and services based on market research and anticipated traveller preferences is going to help them attract customers in the future. The travel business will become personalized and digital in the new normal. Hence, integrating holistic digital communication and marketing channels such as websites and social media platforms is going to be essential for even the offline travel agents.
How effective can governments be in helping revive this sector? Any suggestions?
Arun Bagaria, Co-founder, TravClan: The travel sector is going to bounce back strongly. The government can take several steps to boost travel in India. There could be schemes and initiatives to promote domestic tourism on the lines of the ‘Incredible India’ campaign that had been gathering a lot of momentum in the pre-pandemic years.
There can be tax and regulatory reliefs for the pandemic period. Hotels, restaurants and travel service providers need to pay a lot of taxes and licensing fees, etc., which could be waived off or reduced in the current scenario. Further, the government can take steps to allow movement of people who get vaccinated as it will boost the demand for travel services. More air-bubbles with foreign countries can be established to facilitate international travel.
Vivek Anand, Country Head, Mauritius Tourism Promotion Authority: The Government can play a very important role in the revival of the tourism sector. This can be done through a wage assistance scheme to ensure that all employees in the tourism sector, whose employers are unable to pay them, get an allowance that allows them a basic standard of living. The other measure that can be implemented is providing soft loans to tourism stakeholders so that businesses do not collapse due to conditions created by the pandemic. These measures will ensure that both, employers and employees, are ready when travel resumes.
Michael Pargal Lyngdoh, Co-founder of Tripoto: Last year’s budget had very little support for the travel industry and I expect the same this year as well. The government is under huge financial pressure this year so in the short run it’s important that companies are self-reliant and figure out a way to survive through this crisis instead of waiting for someone to bail them out. However, In the medium to long term the government can play a big role in promoting the travel sector. There is a very large scope for travel to be developed into a more significant contributor to the GDP. Some of the important measures on the demand side would be investing in overall safety for tourists like tourist helplines, government verified travel agents, healthcare access and information and better public transport. On the supply side, most operators are struggling. By introducing favourable tax and licensing legislation, the government can help airlines, hotels, travel agencies and publishers such as Tripoto make up for the unforeseen loss due to the pandemic.
Compare the last Quarter of 2019 to the current scenario and how long will it take you to go back to pre covid numbers?
Vivek Anand, Country Head, Mauritius Tourism Promotion Authority: This is totally dependent on opening of international borders and the health and safety protocols mandated by various countries. Assuming international travel starts in the last quarter of 2021 and borders do not close again, we should be back to Q4 2019 levels by Q2 of 2024.
Being a B2B Travel brand, how are your Travel agents coping with the recession, have you lost any existing clientele?
Arun Bagaria, Co-founder, TravClan: COVID-19 is ushering in a major transformation in travel services globally. The stringent global lockdown which almost completely halted all travel services world over was an unprecedented event. Many travel companies had to pivot their business operations temporarily to generate revenues. However, as soon as the restrictions were lifted, travel agents saw huge demand from clients wanting to travel around Diwali. A number of agents started generating business from new customers who wanted support due to the prevalent uncertainty. Currently, we are going through the second wave which has again brought about a lockdown in most parts of India and suspension of domestic tourism.
Travel agents and the entire travel industry is expecting a strong recovery as vaccination has now started picking pace. While we lost a few agents who temporarily stopped travel business as soon as they came back in travel they started working with us. We are helping travel agents create a strong online presence by building websites and supporting them with services such as digital marketing and online payments etc. There is a tremendous demand and we have been aggressively focusing on expanding our clientele during this period. The time is ideal for agents and platforms like us to come together and strategically plan for the future demand.
How are you sustaining your brand and the business during this time?
Arun Bagaria, Co-founder, TravClan: TravClan’s brand promise is to empower travel agents with necessary technology and online presence and eliminate the trust gap in the travel industry. We are ushering in a technology driven transformation to the US $100 billion offline travel market in India and South East Asia. Having previously worked in Travel industry with Tech startups, Chirag Agarwal (co-founder), Ashish Thapliyal (co-founder and CTO) and I constantly focus on eliminating the three main challenges faced by 300,000+ small and medium travel agents in India. Since these travel agents operate offline, TravClan helps them generate leads by bringing them online. We help them source flight tickets, hotels and holiday bookings at best B2B prices. Another major challenge is the access to cost effective and fast payments and credit solutions. We have built TravClan to be the one-stop solution for all of these challenges and offers numerous other benefits to the users.
Even during the pandemic, TravClan as a brand has been going strong. We have been holding a lot of discussions with industry experts, stakeholders and our agents to keep everyone apprised of the situation. We are using this time when travel services are suspended to strengthen backend operations, bring more agents and service providers onboard. We are continuously strengthening our teams and are well poised to meet the support needs of the agents and stakeholders at all times.
Ways in which the travel industry can sustain the pandemic
Arun Bagaria, Co-founder, TravClan: The situation can be overcome with patience and adaptability. A large number of hotels, guest houses and hostels have started operating as quarantine facilities and COVID hospitals. This is enabling the hotels to maximize occupancy and generate crucial revenue even when tourist traffic is negligible. The trend of workations is another major development which is rapidly gaining popularity among travel lovers and businesses. People are increasingly opting for working remotely from one particular location of their choice whether it is a hill station or a coastal area. Hotels in almost all major tourist destinations are offering lucrative workations deals for travellers willing to stay with them for 15 days or longer. Similar to workations, staycations are another growing trend. Having spent over a year locked into their homes, people are opting to move into hotels within their cities and hometowns to get the much needed respite. Staycations are also beneficial for hotel owners as they get longer occupancy for their rooms. The key is to stay focused, strategize and build capacity for future demand. For now innovations have managed to help the sector generate some revenue via some of these measures.
What will be the future of small travel agents post the pandemic?
Arun Bagaria, Co-founder, TravClan: Small travel agents are going to become increasingly crucial to the future of travel operations. People will look forward to greater assistance and personal support from the travel agents to help them fulfil their travel aspirations. There will be a higher demand for tailor-made itineraries and choice of destinations. Tourists will seek new experiences and the demand for exploring new, unexplored territories will lead to greater opportunity for small agents to add value. Most of the offline travel agents have very strong client relationships nurtured over the years and they are well versed with the families, choice of destinations and personal preferences of their clientele.
Another major trend that will positively impact small travel agents will be the consumer need for a more direct and personalised relationship with their travel providers. Companies and individuals now seek providers who are accountable, can be reached quickly over a call or message at any point in the day, who can hand-hold them and answer their many questions around safe travel. They do not want to be connected via a bot or an IVR. This shift will go a long way in helping offline players strengthen loyalty and get recurring clientele.