Ayyappan R, CEO, Cleartrip
evenge travel was one of the key trends of the past year. This was good news for OTAs like the Flipkart group-owned Cleartrip. In an exclusive conversation with Storyboard18's editor Delshad Irani, Cleartrip's chief executive officer Ayyappan R gives us a quick recap of the company's growth in 2022 and the growth strategy for coming months. He sheds light on the key consumer trends and expectations in the travel industry, and what end users can look forward to this year.
Ayyappan also shares the genesis of Cleartrip's new campaign - 'Invest in travel'. The three ad films address different generational cohorts and what they seek when they travel. It is a quirky take on conventional investment campaigns and ends with the line ‘investing in travel is not subject to market risks’.
Read on.Q. Were you prepared for the resurgence of demand brought on by trends like revenge travel? How did the past year fare for Cleartrip, also in terms of capturing that pent-up demand?
The last 12 to 14 months witnessed the return of travel and a lot of travel players did not foresee this sort of pent up demand including airlines, hotels, OTA players, and others. Therefore, the supply started getting crunched.
International tourism is not 100 percent back, but when it comes to domestic tourism, it's truly back. If you look at the prices, it is around 15-20 percent more than what we have seen pre-Covid. This industry is already one of the highest price point categories and India is known as a value economy but in spite of the price jump and people are traveling. That's completely unheard of till now.
It is quite surprising that even after the holidays and festivals are over, demand has not dropped down. For Cleartrip, this has been an important learning curve especially because Flipkart acquired Cleartrip when the trend was changing.Q. What was the genesis of the 'Invest in Travel' campaign and insights driving it?
Travel is the time we invest with families, friends and loved ones. It's about experiencing thrills and indulging in adventures. I experienced a lot of learning and growth during my travels. So whenever you speak about growth, learning or for that matter even something fun, it cannot be an expense, right? These thoughts sowed the seeds for the campaign.
The consumer insight here was that travel is not an expense, but an investment in yourself and this is the only investment which is not subject to market risk. Firstly, we wanted to target students because for Gen Z it’s all about experiences. They don't believe in owning anything. It's all about the borrowed economy. We also focused on senior citizens. We deeply believe in these two segments and genuinely understand them.
Cleartrip also offers no cost EMI where one can travel now and pay later to further reinforce the idea that travel is a massive investment, and it's going to be well worth it.Watch the video interview here: Cleartrip CEO Ayyappan R: No one expected this kind of resurgence in travel demandQ. What are the key travel trends which influence your strategies?
Consumers used to plan their vacations way ahead of their actual vacation. Post Covid, people are very finicky about it. This has turned the ticket booking process into a two-week affair.
Also, it is tricky for the airline partners because you need to deploy your aircraft based on the demand you see. So that's where we introduced some flexibility so that people are able to book way early and still don't need to worry about the consequences if their plan changes.
Earlier, a lot more domestic vacations used to take place within the state and in international places, you saw going to Southeast Asian countries, the US, Europe and Australia. Post-Covid, all these countries are witnessing less tourists due to visa issues and because the international supply is not at par with what it used to be pre-Covid. Now, people are actually thinking of taking vacations domestically, but outside the home state, at least 60 percent of the travel intent.
International demand is shifting towards domestic but it is happening outside the home state because that's where people want to spend a lot more time. Besides, every organisation, every corporate has embraced working from home and the flexibility in working has gone up multiple notches.Q. How do you plan to scale up your B2B and corporate business which contribute to higher margins?
One of the biggest reasons for Flipkart acquiring Cleartrip was the fact that travel is the third largest industry. This industry has not been disrupted, either in B2C or in the B2B space. This is why we started with building those kinds of constructs in B2C which did not exist in the OTA space before we came in.
Likewise, in B2B, we wanted to build an app which would enable a seamless process for people to make bookings for their travels without any hassle. We are confident that we will make an impact in the B2B world as well with the help of our exemplary user experiences and user interface.Also read: What will 2023 bring for travel & hospitalityQ. You are now focusing on product related expansion rather than geographic expansion. Can you elaborate on that?
The Indian travel space itself is so big, and this is one of the very few industries which is expected to grow at double digit (compound annual growth rate) for the next five years. It is expected to touch around $20 billion in the next five years. And India is full of several Indias coming together. So our strategy related to product expansion cannot revolve around only one cohort of customers.
There is a huge problem statement existing within India itself, leading to a huge opportunity. In fact, everyone outside India is actually coming to India and trying to figure out how to work with this market. Thus we don't see a need to venture out at this point of time. But as opportunities exist, we will always be exploring but now we are super focused on India.Q. Tell us about the synergies with Flipkart. Going forward, what goals would you focus on for growth?
One of the largest benefits that we've got out of the group is the usage of a democratised reward structure called super coins. When you shop on Flipkart, you get super coins, which you can use on any other company as well. Today you can use it on Myntra, Cleartrip and PhonePe. Since you can make use of super coins across all of these companies, it leads to acquiring and retaining customers within the group.
Secondly, there are more than 200 million users in Flipkart itself. So we don't need to take that sort of time to understand the consumers. Flipkart has always been coming up with unique solutions for India. We are able to leverage it; it is the second biggest advantage we get from Flipkart as a group.Also read: Make rural cool again: How rural tourism can become an opportunity for local communitiesQ. Take us to the moment when you had the realisation that travel is an investment and not an expense.
This happened around two years back when I went to Maldives with my family. During our time together as a family, consciously we didn't use our phones. My daughter thoroughly enjoyed her time there due to the undivided attention she was able to get from us – her parents, and that made those moments beautiful. This made me realise that how can one budget these kinds of experiences and treat them like an expense when it is so much more meaningful than that.
Check out our Festive offers upto Rs.1000/- off website prices on subscriptions + Gift card worth Rs 500/- from Eatbetterco.com. Click here to know more.