Travel portals hit heights as biz travel slows down

23 Jun, 2008, 2130 hrs IST,Vishakha Talreja , ET Bureau

NEW DELHI: The slowdown in the business travel market is making at least one industry sub-sector happy––travel portals like Makemytrip, Yatra, Cleartrip and Travelguru. Major players in the online travel market say that they will break-even by end of this fiscal thanks to dip in corporate travel which has led to cheaper deals for that these portals on hotel bookings.  Though majority of transactions on these portals are for air-tickets ,hotel bookings, which offer higher margins, is catching up fast. For instance, over 90% of Travelguru's Rs 250-crore yearly sales comes from hotels, whereas it accounts for 10% of Yatra's Rs 513-crore turnover.  Explains makemytrip CEO Keyur Joshi, "As there is a liquidity crunch in the market, not many new players have entered the online travel industry this year, that could have further crowded it. Also as corporate travel is dipping, the tophotel chains, which did not consider makemytrip and the likes earlier, are now supplying us the inventory to get leisure tourists."  The website, which claims sales of over Rs 1,000-crore in 2007-08 , hopes to break-even in the next few months. Adds an Indiatimes official : "The air-ticket space has been cluttered . Portals are now offering accommodation , cruises and packages which have a higher propensity to make money , improving portals bottomline."  Also Read à Sikkim on a mission to woo tourists à India eyes becoming top tourist destination for Chinese à Rich Indian tourists making a beeline for Malaysia à Revised estimates put tourism earning at $9.16 bn à Foreign tourist arrivals on rise Online space witnessed mushrooming of travel portals around two-three years back. But with rising customer awareness about e-travel overtime, travel portals also intend to cut down on their advertising & marketing spends, and this will also help shore up their bottomlines faster. Says Cleartrip CEO Sandeep Murthy ; "In the last three months we have cut our marketing cost significantly . Around 70% of our customers are repeat clients."  Agrees Travelguru CEO Ashwin Damera ; "Marketing cost this year will be much lower. With global economic slowdown , we know that venture capitalists will be stingy with their money (either for new ventures or follow-up funding) travel websites are not spending excessively on marketing absurd schemes to attract customers" .  Most of the travel portals have opened travel shops, and their sales (and profits) includes revenue from the offline medium as well. For instance Yatra has opened Yatra lounges in malls and is bullish on them. "We now are a sales of over Rs 100-crore a month. We will end up covering our cost in the last quarter of this year," says Yatra co-founder Dhruv Shringi.