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Thursday, 19 April, 2018, 12 : 00 PM [IST]

TBM EXCLUSIVE - MakeMyTrip should break even by end of FY20: Deep Kalra

To focus on hotel bookings & corporate travel for SMEs aggressively
Deep Kalra, Chairman & Group CEO of MakeMyTrip, is hopeful that the online travel consolidator will be able to recover from the losses suffered because of the adverse aviation business environment in India, including the grounding of Kingfisher Airlines, and reach break even by the end of fiscal year 2020. He said that the acquisition of Goibibo has fastened the pace of recovery as they have been able to leverage hotel bookings in a major way by clear demarcation of brands. While MakeMyTrip is being positioned as a premium brand, Goibibo will cater to the budget travellers, Kalra said while talking exclusively to TravelBiz Monitor on the sidelines of the 14th edition of Hotel Investment Conference South Asia in Mumbai.

“We are on track to break even by end of financial year 2020, and start making money. Our business was heavily dependent on air ticketing, and it took a major hit two years after listing on Nasdaq and with Kingfisher Airlines going bust. We took a while to recover; however, losses have gradually started coming down. Post the acquisition of Goibibo, we are looking at scaling hotel bookings and grow significantly,” he said.

Currently, MakeMyTrip enjoys a market share of 24% in the domestic air ticketing market in India, and Kalra is looking at achieving that kind of scale for hotel bookings. “The hotel booking segment in India is highly fragmented. There are approximately 80,000 properties, and branded chains constitute only 10-12% of the market. This means the rest are independent hotels and therefore there is a huge opportunity for us to grow. We are consciously investing in developing the hotel booking segment, which is now our main focus  for business. For hotel bookings, we are looking at reaching break even per unit basis. As far as customer overlap between MakeMyTrip and  Goibibo is concerned, we are positioning the former as a premium brand and latter as a budget offering,” he stated.

Besides hotel bookings, MakeMyTrip has identified the corporate travel segment for SMEs as an engine for growth. “Approximately 25% of this market is controlled by large TMCs or B2B aggregators primarily serving big corporate entities. The SMEs do not have a large business travel demand when compared to big corporate entities, hence TMC tie-ups are not favourable for their business needs. Our corporate product feature, MyBiz is a one-stop travel solution for many such organisations, especially the SMEs that travel for business and rely upon our online tool, which helps them get the same advantages that large companies get for their business travels.”

MyBiz works as a self-booking tool that employees can use from the same MakeMyTrip app for their business travel needs. “In the past quarter, we have saved about a million dollars for over 4,000 SMEs booking through us. Now, we have over 25,000 registered SMEs on our platform and we aim to capture a larger space in the corporate travel segment,” Kalra stated.

Moreover, he is positive about expanding international air ticketing and cruise travel. “Gradually, overseas air booking is gaining acceptance, and we are looking at growing this vertical since ticketing is a robust business because of the sheer volume of sale. On the other hand, cruise travel is the fastest growing segment and we want to push this vertical since the surface hasn’t even been scratched.”

For the tour packages, Kalra is looking at moving its bookings increasingly online since consumers are becoming more comfortable with digital payments.
 
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