India Online Travel Market Outlook to 2030

India Online Travel Market Overview

• In 2023, the India Online Travel Market was valued at USD 15.35 billion. This significant market size is attributed to factors such as enhanced internet connectivity, widespread adoption of smartphones, and increasing levels of disposable income among consumers. These elements have collectively fostered a conducive environment for the growth of online travel services across the country.
• The market is dominated by key players such as MakeMyTrip, Yatra, Cleartrip, Goibibo, and EaseMyTrip. These companies have established strong brand recognition and extensive networks of partnerships with hotels, airlines, and other service providers, making them significant players in the online travel sector.
• In recent news, MakeMyTrip announced a strategic partnership with Amazon Pay in 2023, aiming to enhance customer experience by integrating seamless payment solutions. This collaboration is expected to leverage Amazon's vast customer base and MakeMyTrip's extensive travel services, potentially increasing market reach and customer engagement.

India Online Travel Current Market Analysis

• The UDAN (Ude Desh ka Aam Nagrik) scheme, aimed at enhancing regional air connectivity, has led to the development of new airports and air routes. By December 2024, 766 routes have been sanctioned under the UDAN scheme facilitating easier access to remote destinations. This initiative has resulted in a notable increase in online flight bookings, as more travelers can now fly to previously inaccessible locations.
• The ease of comparing prices, booking tickets, and accessing travel information online has significantly reduced the reliance on traditional travel agents, reshaping consumer behavior towards a more digital-oriented approach.
• The northern and western regions of India dominate the online travel market due to higher urbanization rates, better internet infrastructure, and greater economic activity. Cities like Delhi, Mumbai, and Bangalore are major contributors to the market, with many technology-proficient consumers opting for online travel services.

India Online Travel Market Segmentations

By Travel Booking Platform: In 2023, the India online travel market is segmented by travel booking platform type into flight booking, hotel booking, and holiday packages. Flight bookings dominate the market as air travel becomes more accessible and affordable. With increasing connectivity and lower airfares, this segment has become the preferred choice for long-distance travel.

By Customer Type: In 2023, the India online travel market is segmented by customer type into individual, group and corporate travelers. The ease of planning and booking individual trips online, combined with the flexibility and control it offers, has made this the individual travelers segment dominant. Additionally, the rise of digital nomads and remote work has further fueled solo travel.

By Payment Method: In 2023, India online travel market is segmented by payment method into credit/ debit card, digital wallets, net banking and cash on delivery. Credit and debit cards dominate due to their Widely adopted due to convenience, security, and associated discounts, credit/debit cards streamline transactions on travel platforms.

India Online Travel Market Competitive Parameters

• EaseMyTrip’s IPO: EaseMyTrip went public in 2021, raising USD 62 million capital for expansion and innovation. By 2024, the company had utilized these funds to enhance its technological infrastructure and expand its service offerings, resulting in a 30% increase in its user base.
• Cleartrip and Flipkart Partnership: Cleartrip's partnership with Flipkart in 2022 aimed to leverage Flipkart’s extensive customer base for travel bookings. This strategic alliance led to over 1.5 million new customers using Cleartrip’s platform by 2024, significantly boosting its market presence.
• Goibibo’s AI Chatbot Launch: Goibibo introduced an AI-based chatbot in 2023 to assist users with travel bookings and inquiries. This innovation has improved customer service efficiency, handling over 5 million queries in its first year and enhancing the overall user experience on the platform.

India Online Travel Industry Analysis

India Online Travel Market Growth Drivers

• Expansion of Online Payment Solutions: The adoption of online payment methods has seen a remarkable increase, with over 1.2 billion digital transactions recorded in the travel sector alone in 2024. This expansion has simplified the booking process, encouraging more consumers to use online travel services.
• Rise of Budget Airlines: The emergence of budget airlines has made air travel more affordable for a larger segment of the population. In 2024, budget airlines accounted for 70 million passengers, reflecting a significant rise in the number of travelers opting for low-cost carriers. This trend has boosted the online travel market as consumers increasingly turn to online platforms for booking affordable flights.
• Increase in Domestic Tourism: The surge in domestic tourism has significantly fueled the online travel market. In the first quarter of 2024, Indian airports registered a historic milestone with 97 million passengers. This growth reflects India's vigorous economic expansion and rising disposable incomes, stimulating heightened domestic travel demand among its populace.

India Online Travel Market Challenges

• Data Privacy and Security Concerns: With the rise in online transactions, the travel industry has faced numerous challenges related to data privacy and security. In 2024, there were over 5,000 reported cases of data breaches in the online travel sector, highlighting the need for robust security measures. These incidents have led to a loss of consumer trust and have posed significant challenges for online travel companies to maintain their reputation.
• Technological Infrastructure Issues: Despite advancements, there are still significant gaps in technological infrastructure, particularly in rural and semi-urban areas. In 2024, it was reported that 300 million potential consumers in these areas lacked reliable internet access, limiting their ability to use online travel services.
• Regulatory Hurdles: The travel industry in India faces various regulatory challenges, including stringent licensing requirements and compliance issues. In 2024, over 200 travel companies faced penalties for non-compliance with regulatory norms. These hurdles have increased the operational costs for online travel agencies and have hindered their ability to expand and innovate.

India Online Travel Market Government Initiatives

• E-Visa Scheme (2014): The introduction of the e-Visa scheme in 2014 has simplified the visa application process for international travelers. By 2024, over 10 million e-Visas were issued, facilitating easier travel to India and boosting the online travel market as more tourists opted for digital visa services.
• National Digital Communications Policy (2018): The National Digital Communications Policy, implemented in 2018, aims to provide universal broadband connectivity across India. By 2024, the policy had connected over 1 billion people to the internet, significantly expanding the potential customer base for online travel services.
• Swadesh Darshan Scheme (2014): The Swadesh Darshan Scheme, launched in 2014, focuses on developing theme-based tourist circuits. By 2024, 15 such circuits were operational, promoting domestic tourism and increasing the demand for online travel bookings as travelers sought to explore these curated destinations.

India Online Travel Market Future Outlook

The India Online Travel Market is expected to grow steadily by 2028, driven by increasing digital adoption and changing consumer preferences towards more convenient and personalized travel experiences.

Future Market Trends

• • Personalized Travel Experiences: The demand for personalized travel experiences has been on the rise. In 2024, over 15 million travelers opted for customized travel packages tailored to their preferences and interests. This trend is driving online travel agencies to invest in AI and machine learning technologies to offer more personalized recommendations and services, enhancing customer satisfaction and loyalty.
  • Sustainable Travel: Sustainable travel has gained significant traction, with an estimated 20 million eco-conscious travelers seeking environmentally friendly travel options in 2024. Online travel agencies are responding by offering eco-friendly accommodations, carbon offset options, and sustainable travel itineraries, catering to the growing demand for responsible tourism.
  • Rise of Experiential Travel: Experiential travel, which focuses on immersive and authentic experiences, has become increasingly popular. In 2024, 86% of millennials prefer to travel for experiences and cultural immersion. Online travel agencies are capitalizing on this trend by offering a wide range of experiential travel packages that cater to diverse interests.