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The Great Indian Traveller

The Great Indian Traveller. Indians prefer travelling abroad to holidaying in India. India has been identified as the second largest travel market in Asia . Outbound travel from India in 2004-05 shows unprecedented growth with figures touching 7.5 million - a growth of 20%.

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The Great Indian Traveller

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  1. The Great Indian Traveller

  2. Indians prefer travelling abroad to holidaying in India. • India has been identified as the second largest travel market in Asia. • Outbound travel from India in 2004-05 shows unprecedented growth with figures touching 7.5 million - a growth of 20%. • Liberalization in foreign travel allowance by government has been a major contributory factor. • As much as 76% of Indian vacation seekers propose to visit an international destination for their next holidays. (Thomas Cook - Readers Digest Study Nov 2006) • Switzerland, USA and Singapore have emerged as the top leisure destinations for Indians. – (Thomas Cook - Readers Digest Study Nov 2006) • Delhi and Mumbai are the big power houses that contribute 70% of India’s outbound travel market. • Of all international travelers, 70% ranked sight-seeing as the most important reason for travel, while shopping was most important for 61%. Casinos, cruises, location shoots are the other attractions for Indians travelling abroad. (Thomas Cook - Readers Digest Study Nov 2006)

  3. Overview of the Tourism Market in India • The total number of Indian outbound travellers this year is 7.5 million. • The Business Traveller (including Corporate Incentive Travel) comprise 50% of the total. • A little less than 50 % will travel for leisure purposes. • The rest will fall under the categories like students, immigrants, etc. Source: The Economic Times July 10, 2005/SOTC Report 2004

  4. Indian Outbound Traveller – a growing market • Outbound travel from India in 2004-05 showed unprecedented growth with figures reaching over 7.5 million, which is higher than the number of foreign tourists entering India – 4.5 million arrivals. • WTO predicts that Indian outbound traffic will grow to 50 million tourists by the year 2020. • Indians travelling abroad spent 1.4 billion US$ in 1999 which is forecast to grow to 3.9 billion US$ billion rupees in 2004. • Government of India has eased foreign exchange restrictions in the last two years. RBI regulations w.e.f. March 2004 permits Indian business travellers to carry up to US$ 25,000 abroad. • Source:Pacific Asia TravelAssociation. • Economic Times Intelligence Unit/ ET July 10, 2005

  5. The Indian Outbound Traveller • Indians with an annual income of Rupees half a million and upwards are regular leisure travellers. • The main demand for overseas travel comes from the business community, especially those who own and run small businesses. Professionals ,doctors, lawyers and IT professionals are regular international leisure travellers. • Traditionally, Indians mostly travel with families and are known to be big spenders. • There is also a growing class of executives who use attractive finance options and credit cards. • Typically, people in the 31-42 year bracket are the target leisure-travel audience. These include many younger people especially DINK (Double income no kids) couples. Source: The Economic Times Intelligence Unit /Pacific Asia Travel Association

  6. Advantage - India • Growing incomes,changing lifestyles are prompting financing of holidays by banks in coordination with big travel companies. • Players include HDFC Bank, Kotak Mahindra Bank, Citibank, Stanchart, etc. • After housing and cars, banks have started to bet on financing holidays with “buy-now, pay-later” schemes. • According to Thomas Cook and Kuoni Travels, holiday finance has grown from 3-5 % to around 12% in FY 04. • Thus Holiday Financing is expected to be the next big area in the personal finance segment. Source:The Economic Times Intelligence Unit

  7. Advantage - India • “It would be foolish not to embrace India with its fast growing economy.” - Richard Branson, Virgin Atlantic Airlines. He called April 1st, 2005 a ‘historic day’ when ten years of effort culminated in Virgin now running three flights a week on the London – Mumbai sector. • ‘What is significant is the potential the market offers. When you have a population of over one billion, even 2% is a very large number, as large as the entire population of Australia’- Mathew Spacie (Sales and Marketing) Cox and Kings.

  8. Region wise performance- Indian Outbound Market. • EUROPE • UK topped the chart with an average of 200,000 Indian visitors in 2001. • Switzerland is next on the chart with 97,400 arrivals from India and 2,40,000 overnight (transit) stays in 2004. • Switzerland emerged as the top favorite country with 23% of Indian tourists opting for it. – (Globetrotter Study, Nov 2006) • MasterCard’s Master Index of Consumer Confidence Survey 2005 said 14% of their respondents prefer Switzerland as a destination for their next trip abroad. • British Tourist Authority rated tourists from India as the 2nd most important segment by nationality. • The amount spent by Indians in the UK alone increased by 25% from 134 million pounds in 2000 to 163 million pounds in 2001. • Europe is an important regional destination for Indians. Source:BTA

  9. Region wise performance- Indian Outbound Market. USA • USA is attractive to Indians because of the eternal fascination for all things American. The sizeable diaspora also beckons once in a while. US has some of the world’s best travel infrastructure making it one of the most enjoyable destinations. • 12 per cent of travelling Indians prefer to visit USA making it the second among the top three favourite destinations. (Switzerland is no. 1, Singapore in no.3) • US arrivals from India in 2003 were 272,000 – a 6 % rise over 2002. Expected arrivals for 2004 are 300,000-- a 10% rise over 2003. • India is one of the four strongest emerging inbound travel markets for the US. In the past decade, arrivals to the U.S. from India (and Poland) have grown faster than arrivals from any of the top 25 inbound markets to the U.S. Source: Travel Industry Association of America.

  10. Region wise performance- Indian Outbound Market. • CANADA • Indians who travelled to Canada between 2002 & 2004 : Canada has been quite successful in attracting Indian Film crews for shoots. Canada especially is a cost-effective destination and has a wide range of experienced technicians, artists and other experts to assist Indian film crews. Source: Statistics Canada, Culture, Tourism and the Centre for Education Statistics.Last modified: 2006-08-31.

  11. 2005 Overnight trips Trips Nights Spending in Canada thousands C$ millions Country of origin1 United States 14,390 57,331 7,463 United Kingdom 888 11,882 1,246 Japan 398 4,750 557 France 351 5,836 463 Germany 311 4,900 410 Mexico 179 3,149 240 Australia 179 2,447 287 South Korea 173 4,466 247 Netherlands 118 1,580 131 China 113 3,723 219 Hong Kong 109 2,161 151 Taïwan 98 1,536 110 Switzerland 97 1,684 163 India 94 1,771 82 Italy 91 1,061 95 Source: Statistics Canada, Culture, Tourism and the Centre for Education Statistics.Last modified: 2006-08-31. Travellers to Canada by Country of Origin - 2005 India was among the “top 15 countries of origin” from 2002-2005

  12. Region wise performance- Indian Outbound Market. • ASIA • The World Tourism Organisation figures reveal that around 47% of Indians travel within Asia to countries such as Singapore, Malaysia, Hong Kong, Thailand and Indonesia. • Singapore and Malaysia have emerged as the top leisure destinations for Indians. • Malaysia has emerged as a recent favorite destination, as a part of the multi-destination trip in combination with Singapore, Thailand and Hong Kong. • South-East Asia, Singapore, have so far been among the hottest cruise destinations.

  13. Region wise performance- Indian Outbound Market. MALAYSIA • India was one of the top 10 visitor markets for Malaysia with 1,87,918 Indian visitor arrivals till Oct 2005. • Malaysia recorded a 20% surge in arrivals from India in 2004 (Jan-Dec), over the same period last year. Cumulative tourist receipts from India stand at $ 75 million with a per person average spend of US$ 400 per visit. • According to Mr. P Manoharan, Director, Malaysia Tourism Promotion Board the total inbound tourist flow to Malaysia from the various Asian countries was 8.7 million for the period January- September 2002. Out of this the Southern Asia Region which comprises Bangladesh, India, Iran, Pakistan, Sri Lanka and others hold 20% share. India alone contributes to 14% of the inbound traffic from Asia to Malaysia. Source:MTPB

  14. Region wise performance- Indian Outbound Market. SINGAPORE. • The number of Indians visiting Singapore in 2005 was 583,000 making India one of the foremost visitor markets for Singapore. Indians are spending two and a half times more than the average visitor from any other country. • For the period Jan-June 2005, the growth rate of tourists from India has been averaging over 20%, against a fall of nearly 7-8% in the same period for tourists from China. • MasterCard’s Master Index of Consumer Confidence Survey 2005 said 17% of their respondents prefer Singapore as a destination for their next trip abroad. • Carriers from Singapore no longer need to tie up with Indian carriers. • Hence air traffic between India and Singapore estimated at 1.5 million, is expected to grow 40% in 2004-05 in the short term. • Ahmedabad and Amritsar may generate substantial traffic to Singapore. • Singapore wants to raise the total number of tourists from 8.94 million to 17 million by 2015. Source:STB/Economic Times Intelligence

  15. Region wise performance Indian Outbound Market. HONG KONG India was one of the key markets showing a 11.3 % increase in the January-November period over 2004. Total number of visitors from India: 2,49,994 Hong Kong is celebrating the ‘Discover Hong Kong’ year throughout 2006 Source: Economic Times Intelligence Group.

  16. Region wise performance - Indian Outbound Market - New Zealand • New Zealand has been voted as the most preferred tourist destination at the Condé Nast Traveller Awards, 2005 held in UK. • New Zealand received top marks for scenery (99), environmental friendliness (98.87) and safety (97). • New Zealand also took the top overall prize, beating winners of 23 other categories, Thailand, Australia and Italy to top the charts. • "The result is gratifying because the readers who voted for us are affluent, upwardly mobile professionals and, most importantly, are very interested in travel.” said Mark Burton, Tourism Minister, New Zealand. • New Zealand is a big hit with Indian tourists who are attracted by its natural beauty and the varied holiday options that New Zealand provides. From adventure sports to luxury lodges, New Zealand has a lot to offer to the discerning Indian tourist. Indian film production companies have evinced interest in location shooting. • Source :Conde Nast Traveller UK

  17. Region wise performance - Indian Outbound Market - UAE • MasterCard’s Master Index of Consumer Confidence Survey 2005 said 14% of their respondents prefer UAE as a destination for their next trip abroad. • The survey was conducted among Indians, planning personal air travel in the next 12 months.

  18. Power Of Delhi and Mumbai. • The majority of Indians travelling abroad for leisure and other purposes are from the metro cities of Mumbai and Delhi.In fact these two cities contribute 70 % of Indian outbound travellers. Source:Pacific Asia Travel Association

  19. Major Attractions- shopping, casino cruises, location shoots. • 71% of Indian travellers listed shopping as a priority which is one of the main motivators for travel. • An opportunity to visit casinos added to the attraction of any holiday, cruise or business trip. • The cruise experience is a great attraction for the affluent Indians.The cruise industry has a short term cumulative market potential of around $70 billion. • Last year, there was a growth of 20%. 30,000 travellers went on cruises last year and number is increasingly growing. The expected growth is 50 % for the current year. • South-East Asia, Singapore, Alaska, Europe, and the Caribbean have so far been the hottest cruise destinations. Source: Pacific Asia Travel Association

  20. Cruising • The Indian film industry plays a major role in influencing affluent Indians to visit places they had seen in the movies. In the recent past, locations such as New Zealand, Australia, Hungary, Scotland, Canada, USA and Bali have been used for shoots. • Over the last few years, increasingly, not just business families but average Indians are looking at cruises for their holidays. • According to the G.M. of Star Cruises, “The Indian market is poised to grow and, as India is the flavour of the business world, it is imperative for cruise companies to come here.” • TCI has introduced cruising to Indians over a decade ago when it brought in the QE II. • Last year Star Cruises took over 70,000 Indian passengers. Of these only 30 % were corporate groups. The rest were Free Individual travelers (FITs). Star hopes to double its number this year. • Indian preferences are – shorter holidays and plenty of activities. • Exotic cruises preferred by the Indian traveller : Yangtze, China Volga and Dneiper, Russia Amazon, South America Nile, Egypt Baltic cruise from Helsinki Source: The Economic Times Intelligence Group Sept 9, 2006

  21. The Road Ahead - TAP THE GROWING INDIAN MARKET THE INDIAN TRAVELLER The Diaspora traveller is the only outbound that has a heavy traffic towards the West. The growth however lies in the Leisure / FITs , honeymooners and business travelers. This sector is predicted to grow for the next five years.The good news is that this segment is the highest spenders and make up for almost 75% of total outbound travelers. All Tourism Boards want a share of this segment …………….DO YOU WANT TO BE LEFT BEHIND???? Source:Compiled from PATA report’02 T

  22. CASE STUDY Singapore Tourism Promotion Board.(STPB) • A smart innovation, resulted in Singapore becoming the most popular destination amongst Indians. • STPB published a full page advertorial .The editorial covered various tourist / leisure attractions in Singapore. At the center of this page was a contest box. To ensure maximum reader participation, the answers to the question were in the edit. • The response was to the contest was tremendous and generated a strong interest level towards Singapore as a travel destination. • A sustained marketing campaign and a bundling of destinations along with Singapore boosted growth in the numbers from India to over 20 % between Jan and June 2005. There was a drop of –7 to –8% in the number of Chinese. • With more flights now connecting the two countries, the role of India in the Tourism economy of Singapore is becoming increasingly important.

  23. CASE STUDY • BRITISH TOURIST AUTHORITY ( BTA) In an effort to tap the potential Indian outbound market BTA sponsored a 4 page colour pull out with The Economic Times titled “ A PASSAGE TO BRITIAN”. The Entire report was coordinated by BTA with support from their various strategic partners both to share costs and contribute towards making an interesting edit for both business and leisure travelers.The report ended with a contest box . In this case also the answers to the questions were within the edit itself. Consequently UK was the favorite destination for all Indians travelling to Europe.

  24. Holidays – Frequency of Travelling Abroad All figures in 000s SOURCE: The Indian Readership Survey – Round 2, 2006

  25. THANK YOU !

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