MakeMyTrip, India's leading online travel agency, is on the lookout for acquisitions, armed with a $70 million cash reserve.
The New York-listed firm is looking to acquire companies in areas like pilgrimage travel, supplier disintermediation, and niche travel technology.
With 13 years of existence and five merger and acquisition deals in the recent past, the company has expanded its service beyond air and hotel booking.
Currently, MakeMyTrip lists 10,000 hotels in India and 70,000 hotels internationally on its network.
Tnooz interviewed head of marketing Manish Kalra about the company's new focus of acquisitions and various other topics.
Q&A with Kalra below.
MakeMyTrip's possible areas of acquisition include - Niche travel tech firms, certain travel segment focused companies, and supplier disintermediation. Can you elaborate on "supplier disintermediation"?
As a company, we are continuously evolving and looking at enhancing our portfolio. For us customers are at the heart of everything we do.
So, when it comes to deciding on our acquisition plans we look at segments that bring us closer to the customer. ‘Supplier disintermediation’ is a perfect example of this.
We believe that there is a scope for one intermediary between suppliers, be it airline or hotel, and customers.
Our goal is to be that intermediary. Through supplier disintermediation we are getting closer to our respective suppliers by removing a layer in the distribution chain.
With respect to travel tech firm acquisition, what are the possible emerging technologies you see/ interested in that will augment MakeMyTrip's business?
Technology has a huge role to play in making travel simpler, easier and hassle free.
Recently, our team developed an application called RoutePlanner that allows users to view multiple routes for the same origin-destination pair.
MakeMyTrip has always been at the helm of providing cutting edge travel technology. As a company we have been investing heavily in creating products and forging partnerships that further strengthen our travel technology portfolio.
We are seeing more and more consumers looking for and booking through their mobile devices.
Today, 10% of our hotel bookings are through mobile.
Hence, for us mobile travel technology will be the next BIG thing in online travel category, along with interactive technologies that enable real-time content-generation and socialization for consumers.
Pilgrimage tourism focused travel companies are of interest for MakeMyTrip. Can you tell us the market size? What are the trends you are noticing in this space in MakeMyTrip?
Pilgrimage travel is possibly Indian travel industry’s best-kept secret in terms of a category showcasing steady and growing returns.
Traditionally, pilgrimages have existed in Indian culture since as far as people can recall.
Earlier people who wanted to travel to religious destinations had to either find a group to go on their own or opt to book through travel agents.
With more customers experiencing the triple benefits of choice, savings and convenience offered by travel portals, the bookings for religious travel is also fast moving online.
Also, travel to religious destinations is now no longer restricted to an older age-group as families treat this as a holiday that helps various age-groups bond better.
We have witnessed a healthy growth in our religious package bookings as compared to last year.
We also observed some really interesting trends:
- North Indians seemed to be more comfortable with online pilgrimage booking as compared to the other regions
- Delhi and Mumbai topped the list for maximum online pilgrimage bookings while the most popular religious destinations during 2012 were Shirdi (Maharashtra), Vaishno Devi, Katra (Jammu), Tirupati (Andhra Pradesh), Golden Temple, Amritsar (Punjab), Jagannath, Puri (Orissa)
We are also seeing a growing trend of experiential travel this summer.
More and more Indians are looking for unique experiences, even if it is a weekend break.
Activity-oriented travel and theme-based packages are getting popular.
Even in international travel, many Indians today are opting for experiential and unconventional activities like a Safari in Tanzania, a tour of archeological sites in Turkey or an F1 race in Singapore.
There has been a robust growth of over 30% in experiential travel this year.
Selling packages online is relatively a new trend in India. How has been the success in this line of business?
We were one of the earliest portals to offer online holiday-bookings in India.
The traditional once-a-year annual holiday is now largely a thing of the past. Today, travelers prefer taking multiple short breaks in a year.
Hectic schedules and growing disposable incomes have contributed to the popularity of weekend-breaks and shorter and frequent holidays.
The availability of a holistic holiday package online makes the travel experience more convenient and hassle free.
Our holiday business has been growing steadily. Revenue from our hotels and packages business increased by 55.2% to $48.6 million in the quarter ended December 31, 2012 from $31.3 million in the quarter ended December 31, 2011.
Our Hotels and Packages business witnessed 67.8% growth in transactions over the same period last year.
MakeMyTrip is the principal sponsor of Sunrises Hyderabad IPL cricket team. How is MakeMyTrip benefiting by this sponsorship?
We are delighted to partner with Sunrisers Hyderabad and reach out to millions of IPL fans through this association.
Our campaign is targeted at growing our Hotels business by extending the brand promise from Memories Unlimited to Hotels Unlimited.
The Television commercial for this campaign will feature the team’s players including Shikhar Dhawan, Cameron White and Ishant Sharma.
Maintaining the witty, humorous and quirky tone of previous brand campaigns, the new commercial will demonstrate the positive effect of a good Hotel experience.