TAKING OFF - THE INDIAN TRAVELER SEEKS NEWER DESTINATIONS TO EXPLORE

By: Surekha Poddar, ED, Consumer Research, Nielsen

Marked increase in interest for travel to newer destinations like China, Maldives, Indonesia and even neighboring Bangladesh, for future trips

Singapore remains top destination, but witnesses a decline in interest as Indians explore newer destinations

The Indian leisure traveler seems to be spoilt for choice. With economic growth stabilizing in the country, post the slowdown, Indians appear keen on planning international holidays not just to destinations like Singapore, but also to China, Maldives, Indonesia, the African continent and even neighboring Bangladesh amongst others. The recently conducted Nielsen - PATA India Outbound Monitor study which tracks international travel from India, shows a significant increase, up from 20% in 2008 to 38% in 2010, in the intent to travel to newer destinations.

This change in preference of destination exhibits a greater sense of adventurism, which should be heartening for tourism as a whole and is a clear symptom of a confident Indian consumer mimicking their country’s confidence and prominence. From the looks of it, the Indian traveler is set to become a prized possession as their potential spending power and disposition to travel to new countries increases.

Singapore still ranks first as the most visited destination for both business and leisure, but its domination has taken a beating. Its share has fallen from 25% in 2008 to 15% in 2010 for business travel and from 32% in 2008 to 24% in 2010 for leisure travel. Leisure travelers rank Malaysia as their second choice for a holiday, while Dubai comes in second after Singapore for business travel. Japan, China and Sri Lanka are showing a rise in business traffic from India. On the whole, Asia continues to dominate travel itineraries for both business (63%) and leisure (76%) travel. Regions such as Europe attract a higher percentage of business traffic (14%) rather than leisure (10%).

Countries competing for Indian globetrotters can take cues from the drivers of destination decision-making. By showcasing their receptivity and a variety of recreational facilities ‘country’ marketers can hope to become the destination of choice. Research shows that the biggest driver for the Indian leisure traveler is to visit friends and family (26%), the range of leisure and entertainment activities a destination offers (18%) and scenic/ natural beauty of the destination (10%) are also key factors in making a destination choice.

Changing Preferences

Among destinations that leisure travelers plan to travel to, there seems to be a significant shift to newer  destinations such as China, Indonesia, Africa amongst others.

Business travelers typically choose destinations based on perceived business conduciveness for conferences and off-sites.

One of the most critical observations of the study is that, the Indian traveler is not a homogenous entity. Apart from the natural segments of those traveling for business or leisure, there are key sub-segments across tiers of towns and different life stages and work profile. Travel motivations also differ in each of these sub-segments as do their planning and their choices. Travelers from the larger Tier I cities tend to be of a higher socio-economic profile and younger than those from Tier II cities. While intent to travel amongst travelers of both Tier I and Tier II cities has remained strong it is pertinent to point out that 22% of travel from Tier II cities is funded by their relatives while for Tier I cities it is a mere 14%. Travelers from Tier II cities who fund their own travel typically tend to spend a lot more time planning their trips and largely rely on travel agents to source information for trip planning.

Despite getting more adventurous in their destination choices, Indian travelers do not show an inclination to raise their travel budgets. Overall, travel expenditure has remained the same as in 2008, among leisure travelers. This could also be due to increasing options within the country at the same price.

According to the study, an average family spends around USD 3663 per trip. Flight and accommodation account for around 45% of the costs and the rest is spent on other expenses like shopping, food, recreational/ sightseeing activities and communication. But Indians are big shoppers and a significant portion of their expenses are kept aside for shopping.

Business travelers have however, reduced their international travel expenses, probably exercising caution as the economy returns to a strong growth trajectory post the economic downturn.

The leisure traveler is also stringent when it comes to choosing an airline. Thai Airways is the most popular with tourists, followed by Jet Airways and Malaysia Airlines. But business travelers opt for Singapore Airlines followed by Emirates and Malaysia Airlines.

With the proliferation of the Internet, online travel agents are becoming a popular option for outbound business travelers. Yatra and MakeMy Trip are making inroads into the corporate segment, but Thomas Cook remains the number one choice for business travelers while SOTC is the most popular choice amongst leisure travelers, though in smaller cities the local travel agent reigns supreme.

About Nielsen India Outbound Travel Monitor

Nielsen India Outbound Travel Monitor provides an understanding of the profile of Indian travelers, their motivations, choice dynamics and perceptions of their travel experience. For the study, Nielsen conducted face-to-face interviews with 2,395 males and females aged 18 and above, (across 6 Tier - I cities and 5 Tier - II cities) who have travelled outside of India in the last twelve months and who have stayed at least two nights away from home with the purpose of either business or leisure travel.

About Nielsen

Nielsen Holdings N.V. (NYSE: NLSN) is a global information and measurement company with leading market positions in marketing and consumer information, television and other media measurement, online intelligence, mobile measurement, trade shows and related properties. Nielsen has a presence in approximately 100 countries, with headquarters in New York, USA and Diemen, the Netherlands. For more information,please visit www.nielsen.com.

About PATA

The Pacific Asia Travel Association (PATA) is a not-for profit membership association that acts as a catalyst for the responsible development of travel and tourism within the Asia Pacific region. This year, PATA is proud to celebrate 60 dynamic years of developing responsible tourism.

In partnership with private and public sector members, PATA enhances the sustainable growth, value and quality of travel and tourism to-from-and-within, the region. The Association provides leadership and counsel on an individual and collective basis to over 80 government, state and city tourism bodies; nearly 50 international airlines, airports and cruise lines and many hundreds of travel industry companies across the Asia Pacific region and beyond. Thousands of travel professionals belong to 39 active PATA chapters worldwide and participate in a wide range of PATA and industry events. PATA’s Strategic Intelligence Centre (SIC) offers unrivalled data and insights including Asia Pacific inbound and outbound statistics, analyses and forecasts as well as in-depth reports on strategic tourism markets. For more information, please visit www.PATA.org

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