The Great Indian Traveller

THINK INDIA THINK TIMES

November 2006
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Indians prefer travelling abroad to holidaying
in India.
India has been identified as the second largest travel market in Asia.
Outbound travel from India in 2004-05 shows unprecedented growth with
figures touching 7.5 million - a growth of 20%.
Liberalization in foreign travel allowance by government has been a major
contributory factor.
As much as 76% of Indian vacation seekers propose to visit an international
destination for their next holidays. (Thomas Cook - Readers Digest Study Nov 2006)
Switzerland, USA and Singapore have emerged as the top leisure
destinations for Indians. – (Thomas Cook - Readers Digest Study Nov 2006)
Delhi and Mumbai are the big power houses that contribute 70% of India’s
outbound travel market.
Of all international travelers, 70% ranked sight-seeing as the most
important reason for travel, while shopping was most important for 61%.
Casinos, cruises, location shoots are the other attractions for Indians
travelling abroad. (Thomas Cook - Readers Digest Study Nov 2006)

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Overview of the Tourism Market in India

The total number of Indian outbound travellers this year is 7.5

million.
The Business Traveller (including Corporate Incentive Travel)
comprise 50% of the total.
A little less than 50 % will travel for leisure purposes.
The rest will fall under the categories like students,
immigrants, etc.

Source: The Economic Times July 10, 2005/SOTC Report 2004

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Indian Outbound Traveller – a growing market

Outbound travel from India in 2004-05 showed unprecedented
growth with figures reaching over 7.5 million, which is higher than
the number of foreign tourists entering India – 4.5 million arrivals.

WTO predicts that Indian outbound traffic will grow to 50 million

tourists by the year 2020.

Indians travelling abroad spent 1.4 billion US$ in 1999 which is

forecast to grow to 3.9 billion US$ billion rupees in 2004.

Government of India has eased foreign exchange restrictions in the

last two years. RBI regulations w.e.f. March 2004 permits Indian
business travellers to carry up to US$ 25,000 abroad.
Source:Pacific Asia Travel Association.
Economic Times Intelligence Unit/ ET July 10, 2005

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The Indian Outbound Traveller

Indians with an annual income of Rupees half a million and
upwards are regular leisure travellers.
The main demand for overseas travel comes from the business
community, especially those who own and run small
businesses. Professionals ,doctors, lawyers and IT
professionals are regular international leisure travellers.
Traditionally, Indians mostly travel with families and are
known to be big spenders.
There is also a growing class of executives who use attractive
finance options and credit cards.
Typically, people in the 31-42 year bracket are the target
leisure-travel audience. These include many younger people
especially DINK (Double income no kids) couples.
Source: The Economic Times Intelligence Unit /Pacific Asia Travel Association
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Advantage - India

Growing incomes,changing lifestyles are prompting

financing of holidays by banks in coordination with big
travel companies.
Players include HDFC Bank, Kotak Mahindra Bank,
Citibank, Stanchart, etc.
After housing and cars, banks have started to bet on
financing holidays with “buy-now, pay-later” schemes.
According to Thomas Cook and Kuoni Travels, holiday
finance has grown from 3-5 % to around 12% in FY 04.
Thus Holiday Financing is expected to be the next big area
in the personal finance segment.
Source:The Economic Times Intelligence Unit

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Advantage - India

“It would be foolish not to embrace India with its fast

growing economy.” - Richard Branson, Virgin Atlantic
Airlines. He called April 1st, 2005 a ‘historic day’ when
ten years of effort culminated in Virgin now running
three flights a week on the London – Mumbai sector.

‘What is significant is the potential the market offers.

When you have a population of over one billion, even 2%
is a very large number, as large as the entire population
of Australia’- Mathew Spacie (Sales and Marketing) Cox
and Kings.

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Region wise performance- Indian Outbound

Market.
EUROPE
UK topped the chart with an average of 200,000 Indian visitors in 2001.
Switzerland is next on the chart with 97,400 arrivals from India and
2,40,000 overnight (transit) stays in 2004.
Switzerland emerged as the top favorite country with 23% of Indian
tourists opting for it. – (Globetrotter Study, Nov 2006)
MasterCard’s Master Index of Consumer Confidence Survey 2005 said
14% of their respondents prefer Switzerland as a destination for their
next trip abroad.
British Tourist Authority rated tourists from India as the 2nd most
important segment by nationality.
The amount spent by Indians in the UK alone increased by 25% from
134 million pounds in 2000 to 163 million pounds in 2001.

Europe is an important regional destination for Indians.

Source:BTA

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Region wise performance- Indian Outbound

Market.
USA
USA is attractive to Indians because of the eternal fascination for all things
American. The sizeable diaspora also beckons once in a while. US has some of the
world’s best travel infrastructure making it one of the most enjoyable destinations.

12 per cent of travelling Indians prefer to visit USA making it the second among the
top three favourite destinations. (Switzerland is no. 1, Singapore in no.3)

US arrivals from India in 2003 were 272,000 – a 6 % rise over 2002. Expected
arrivals for 2004 are 300,000-- a 10% rise over 2003.

India is one of the four strongest emerging inbound travel markets for the US. In
the past decade, arrivals to the U.S. from India (and Poland) have grown faster
than arrivals from any of the top 25 inbound markets to the U.S.

Source: Travel Industry Association of America.

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Region wise performance- Indian Outbound

Market.

CANADA
Indians who travelled to Canada between 2002 & 2004 :

Nights in
Year Trips in thousands thousands Spend in C$ Millions

2004 73 1432 62
2003 67 1297 57
2002 68 1377 51

Canada has been quite successful in attracting Indian Film crews for shoots. Canada
especially is a cost-effective destination and has a wide range of experienced
technicians, artists and other experts to assist Indian film crews.
Source: Statistics Canada, Culture, Tourism and the Centre for Education Statistics.
Last modified: 2006-08-31.
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Travellers to Canada by Country of Origin - 2005

2005
Overnight trips
Trips Nights Spending in Canada
thousands C$ millions
Country of origin1
United States 14,390 57,331 7,463
United Kingdom 888 11,882 1,246
Japan 398 4,750 557
France 351 5,836 463
Germany 311 4,900 410
Mexico 179 3,149 240
Australia 179 2,447 287
South Korea 173 4,466 247
Netherlands 118 1,580 131
China 113 3,723 219
Hong Kong 109 2,161 151
Taïwan 98 1,536 110
Switzerland 97 1,684 163

India 94 1,771 82
Italy 91 1,061 95
Source: Statistics Canada, Culture, Tourism and the Centre for Education Statistics.
Last modified: 2006-08-31.

India was among the “top 15 countries of origin” from 2002-2005

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Region wise performance- Indian Outbound

Market.
ASIA
• The World Tourism Organisation figures reveal that around 47% of Indians
travel within Asia to countries such as Singapore, Malaysia, Hong Kong,
Thailand and Indonesia.

• Singapore and Malaysia have emerged as the top leisure destinations for
Indians.

• Malaysia has emerged as a recent favorite destination, as a part of the

multi-destination trip in combination with Singapore, Thailand and Hong
Kong.

South-East Asia, Singapore, have so far been among the hottest cruise
destinations.

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Region wise performance- Indian Outbound

Market.
MALAYSIA
• India was one of the top 10 visitor markets for Malaysia with 1,87,918
Indian visitor arrivals till Oct 2005.

• Malaysia recorded a 20% surge in arrivals from India in 2004 (Jan-Dec),

over the same period last year. Cumulative tourist receipts from India
stand at $ 75 million with a per person average spend of US$ 400 per visit.

According to Mr. P Manoharan, Director, Malaysia Tourism Promotion Board

the total inbound tourist flow to Malaysia from the various Asian countries
was 8.7 million for the period January- September 2002. Out of this the
Southern Asia Region which comprises Bangladesh, India, Iran, Pakistan,
Sri Lanka and others hold 20% share. India alone contributes to 14% of the
inbound traffic from Asia to Malaysia.
Source:MTPB

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Region wise performance- Indian Outbound

Market.
SINGAPORE.
The number of Indians visiting Singapore in 2005 was 583,000 making India one
of the foremost visitor markets for Singapore. Indians are spending two and a
half times more than the average visitor from any other country.
For the period Jan-June 2005, the growth rate of tourists from India has been
averaging over 20%, against a fall of nearly 7-8% in the same period for tourists
from China.
MasterCard’s Master Index of Consumer Confidence Survey 2005 said 17% of
their respondents prefer Singapore as a destination for their next trip abroad.
Carriers from Singapore no longer need to tie up with Indian carriers.
Hence air traffic between India and Singapore estimated at 1.5 million, is
expected to grow 40% in 2004-05 in the short term.
Ahmedabad and Amritsar may generate substantial traffic to Singapore.
Singapore wants to raise the total number of tourists from 8.94 million to 17
million by 2015.

Source:STB/Economic Times Intelligence THINK INDIA.THINK TIMES

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Region wise performance

Indian Outbound Market.

HONG KONG

India was one of the key markets showing a 11.3 % increase in the January-
November period over 2004.

Total number of visitors from India: 2,49,994

Hong Kong is celebrating the ‘Discover Hong Kong’ year throughout 2006

Source: Economic Times Intelligence Group.

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Region wise performance - Indian

Outbound Market - New Zealand
New Zealand has been voted as the most preferred tourist destination at the Condé
Nast Traveller Awards, 2005 held in UK.

New Zealand received top marks for scenery (99), environmental friendliness
(98.87) and safety (97).

New Zealand also took the top overall prize, beating winners of 23 other
categories, Thailand, Australia and Italy to top the charts.

"The result is gratifying because the readers who voted for us are affluent,
upwardly mobile professionals and, most importantly, are very interested in travel.”
said Mark Burton, Tourism Minister, New Zealand.

New Zealand is a big hit with Indian tourists who are attracted by its natural beauty
and the varied holiday options that New Zealand provides. From adventure sports to
luxury lodges, New Zealand has a lot to offer to the discerning Indian tourist. Indian
film production companies have evinced interest in location shooting.

Source :Conde Nast Traveller UK

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Region wise performance - Indian

Outbound Market - UAE

MasterCard’s Master Index of Consumer Confidence Survey 2005

said 14% of their respondents prefer UAE as a destination for their
next trip abroad.
The survey was conducted among Indians, planning personal air
travel in the next 12 months.

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Power Of Delhi and Mumbai.

The majority of Indians travelling abroad for

leisure and other purposes are from the metro
cities of Mumbai and Delhi.In fact these two cities
contribute 70 % of Indian outbound travellers.

Source:Pacific Asia Travel Association

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Major Attractions- shopping, casino cruises,

location shoots.
71% of Indian travellers listed shopping as a priority which
is one of the main motivators for travel.
An opportunity to visit casinos added to the attraction of
any holiday, cruise or business trip.
The cruise experience is a great attraction for the affluent
Indians.The cruise industry has a short term cumulative
market potential of around $70 billion.
Last year, there was a growth of 20%. 30,000 travellers
went on cruises last year and number is increasingly
growing. The expected growth is 50 % for the current year.
South-East Asia, Singapore, Alaska, Europe, and the
Caribbean have so far been the hottest cruise destinations.

Source: Pacific Asia Travel Association

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Cruising
The Indian film industry plays a major role in influencing affluent Indians to visit places they had seen in the movies. In the
recent past, locations such as New Zealand, Australia, Hungary, Scotland, Canada, USA and Bali have been used for shoots.
Over the last few years, increasingly, not just business families but average Indians are looking at cruises for their holidays.
According to the G.M. of Star Cruises, “The Indian market is poised to grow and, as India is the flavour of the business world, it
is imperative for cruise companies to come here.”
TCI has introduced cruising to Indians over a decade ago when it brought in the QE II.
Last year Star Cruises took over 70,000 Indian passengers. Of these only 30 % were corporate groups. The rest were Free
Individual travelers (FITs). Star hopes to double its number this year.
Indian preferences are – shorter holidays and plenty of activities.
Exotic cruises preferred by the Indian traveller :
Yangtze, China
Volga and Dneiper, Russia
Amazon, South America
Nile, Egypt
Baltic cruise from Helsinki

Source: The Economic Times Intelligence Group Sept 9, 2006

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The Road Ahead - TAP THE GROWING

INDIAN MARKET
THE INDIAN TRAVELLER
I

D ia s p o r a - L E IS U R E /F IT H o n e y m o o n e rs B u s in e s s
M a i n ly w e s t w a r d G r o w in g m a rk e t A la r g e s p e n d in g t r e v e lle r s
35% a u d ie n c e ( 30% )
The Diaspora traveller is the only outbound that has a heavy traffic towards the West.
The growth however lies in the Leisure / FITs , honeymooners and business travelers.
This sector is predicted to grow for the next five years.The good news is that this
segment is the highest spenders and make up for almost 75% of total outbound
travelers.
All Tourism Boards want a share of this segment …………….DO YOU WANT TO BE LEFT
BEHIND????

Source:Compiled from PATA report’02

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CASE STUDY
Singapore Tourism Promotion Board.(STPB)

A smart innovation, resulted in Singapore becoming the most popular destination

amongst Indians.

STPB published a full page advertorial .The editorial covered various tourist /
leisure attractions in Singapore. At the center of this page was a contest box. To
ensure maximum reader participation, the answers to the question were in the
edit.

The response was to the contest was tremendous and generated a strong interest
level towards Singapore as a travel destination.

A sustained marketing campaign and a bundling of destinations along with

Singapore boosted growth in the numbers from India to over 20 % between Jan
and June 2005. There was a drop of –7 to –8% in the number of Chinese.

With more flights now connecting the two countries, the role of India in the
Tourism economy of Singapore is becoming increasingly important.

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CASE STUDY
BRITISH TOURIST AUTHORITY ( BTA)

In an effort to tap the potential Indian outbound market BTA sponsored a 4

page colour pull out with The Economic Times titled “ A PASSAGE TO BRITIAN”.

The Entire report was coordinated by BTA with support from their various
strategic partners both to share costs and contribute towards making an
interesting edit for both business and leisure travelers.The report ended with a
contest box . In this case also the answers to the questions were within the edit
itself.

Consequently UK was the favorite destination for all Indians travelling to

Europe.

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Holidays – Frequency of Travelling Abroad Once in
Six
Months Once in Once in
or more 6 Once in Once in Once in 5 or
Travel frequent Months- 1-2 2-3 3-5 more
All Abroad ly 1 Year Years Years Years Years
Est. Individuals (000s) 800429 1417 124 334 384 203 164 209
All Publications
Deccan Chronicle 969 11 2 1* 3 2 3
Deccan Herald 542 11 * 1- 4 2 3
DNA 444 2- * * * * -
Financial Exp 58 * - - * - - -
Hindu Business Line 147 4* - 2 2- -
Hindu 2573 71 6 11 25 6 12 10
Hindustan Times 3504 98 6 29 25 11 10 18
Midday (Eng) 600 12 * * 4 2* 5
Mumbai Mirror 748 12 2* 2 1 3 2
New Indian Express 624 6- * 1 2- 2
Statesman 326 3- - * 2 1-
Telegraph 1007 24 2 3 9 3 2 6
The Economic Times 803 38 3 7 17 4 5 2
The Indian Express 508 20 - 1 3 8 6 1
Times Of India 6923 178 13 40 43 27 20 35
Vijay Times 442 1- - 1- - -
Business Std 58 2- * - - * -
Business World 286 10 1 1 3 2 3*
India Today (Eng) 3137 92 11 18 20 11 11 20
Outlook 1093 39 6 8 6 * 3 15
Time 185 12 3 1 2 2 1 2
Business India 428 35 9 5 8 3 3 7
Business Today 600 31 8 3 7 5 4 4
Femina 574 31 * 5 5 7 3 10
Frontline 321 18 3- 7 2 4 2
Outlook Money 160 14 * 6 6 - - 1
Woman'S Era 454 20 - 2 5 2 3 9
Cine Blitz 231 13 3* 4 * 2 3 All figures in 000s
Cosmopolitan 143 9 4 2 3 - * -
Elle 47 * - - * - - -
Filmfare 1270 31 3 5 7 4 5 7
India Today Travel Plus 140 1- - - * * -
Outlook Traveller 205 6 4* - * 1-
Readers Digest 2046 91 11 19 26 11 10 13
Savvy 112 8* 3 3 1* -
Society 267 17 7 3 1 5 1*

SOURCE: The Indian Readership Survey – Round 2, 2006

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THANK YOU !

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