Indian online travel players hit accelerator....again!

The Indian online travel industry seems (in market designed to produce mixed metaphors) to burst in waves. Back in 2008- the four leading companies of India - Makemytrip, Cleartrip, Yatra and Travelguru seemed to have created a $2bb plus online travel market from a near standing start.

In their recent India report, PhoCusWright now puts the 2010 online travel market (leisure and un-managed business) at more than double 2008. $4.3bb is their size estimate, as much as 25% of the total travel market. They predict a rise to $7bb in 2012 (you can buy the report here). That would put the India of 2012 at the same size as the online market of Australia in 2010. An almost unrivaled acceleration in online travel. Like many markets online, the buying of low cost carrier tickets is a huge driver. But, unlike many markets, rail is a significant part of the grow story in India. Online rail in India is already more than a $1bb a year and is more than a quarter of the online travel industry's total turnover. In India (according to PhoCusWright), the percentage of rail online is twice the percentage of hotel online.

Corporate activity is accelerating alongside the market acceleration.

Number one player MakeMyTrip (MMYT) has been public for less than a year (IPO in August 2010). They went to the market at $14 and are still trading above $30 (Apr 21 at $32.23) with a valuation in excess of $1.1bb.

Cleartrip is chasing hard. They have just raised $40 mm from travel travel expense and management solution provider Concur (you remember them, they bought TripIt in Feb for up to $120mm).

Not to be left out, a day later Yatra announced they were raising $45mm from raised from Valiant Capital Management, Norwest Venture Partners, Intel Capital and others (WSJ story here). According to the WSJ this eclipes the $33.8mm they raised in the last round. The article quotes sources saying that a float in the next 12-18 months is very likely.

Expedia is also refusing to be left out. They have added India to their list of markets covered by their JV announced with Asian low cost carrier giant Air Asia.

Via is trying to argue there is room for more players. With $15mm raised so fare from NEA Indo-US Ventures, Sequoia Capital India and others, Via (also known as Flightraja) has mega bucks in their sites announcing last month they intend (emphasis on intend) to raise another $100mm.

Travelocity are trying to peek their head above the noise through a marketing relationship with Mastercard.

A very busy 30 days in a fast growing market. Did I miss anything? For the Tnooz latest list of top travel sites in India care of Hitwise click here.

Thanks to FriskoDude for the great photo via flickr

Cleartrip CEO : 15 months in the black. Targeting hotels, display advertising and Dubai

Cleartrip may be the smallest of the big 3 (ok medium 3) of the online Indian full service OTA business but Founder & Director, Product and Strategy Hrush Bhatt is far from worried. During a coffee break chat at eyefortravel TDS in Singapore last month Hrush told me that he is not taking being number 3 too hard. In fact he is celebrating the size difference. He tells me that although MakeMyTrip may have 1,300 employees to Yatra’s 8-900 and Cleartrip’s 260 Hrush is unworried having reported his 15th month in a row of profitability.

[UPDATE - since publishing this post I have been told that Cleartrip is bigger than Yatra and the clear number two to MakeMyTrip. I don't have numbers to confirm but it clear that the battle has only just started]

Air is still a critical part of the business but like much of the online world he and Cleartrip are targeting hotels for growth. Again like much of the online travel world he is using some creative hiring practices to help Cleartrip get there. Cleartrip have hired the founder of the Travelguru to lead their hotel contracting efforts. Travelguru was bought by Travelocity in August 2009. Current hotel count is 1,400, when it gets to around 1,800 to 2,000 Hrush says that Cleartrip will begin a marketing push.

I was interested to hear that one of the main marketing efforts for Cleartrip was display advertising. After each of Yatra, MakMyTrip and Cleartrip reached a “gentlemen’s agreement” to not bid on each other’s brand terms in search advertising it freed up a lot of marketing spend to invest in display.

This is not the only way that the Indian market has a different twist to emerging online travel markets. While India maybe smaller than the more mature Asian online travel markets Japan and Australia the target population have been online since 1996. That means by the time online travel started to take off in India in 2006, the population had already been online for ten years, allowing for speedy growth and rapid adoption. PhoCusWright reported this week that the 2009 Indian online travel market was US$3.4 billion (Indian Online Travel Intermediary Review).

On functionality, Cleartrip have taken a Kayak look and feel approach to travel (as opposed to the more traditional OTA look of MakeMyTrip). This is deliberate according to Hursh. They are looking to new approaches to travel search, targeting the image lite Google like approach of text boxes.

Hrush is also looking to expansion beyond India. Cleartrip.ae is now live and targeting consumers in Dubai. Not a traditional place of expansion for an Asian online travel company but in Hrush's view Cleartrip already have some awareness and it is a small enough market for Cleartrip to test expansion

Want to read more on Cleartrip? I was not the only one to catch up with Hrush in Singapore. Check out Siew Hoon's piece called "Cleartrip out to make the world smaller".

901 not out

100 more posts live on the BOOT. 4 years, 200,000 plus words, 150,000 visitors, 240,000 page views and still going. In my regular "not out series" recap I post a few reminders and highlights form the last 100 posts. It started with 101 not out and continued with 201, 301, 401, 501. 601, 701 and 801 not out. Here we go....

Buy buy buy. We may still be waiting for the mega deal but the tuck-ins are everywhere

• Zuji/Travelocity bought Indian based Travelguru
• WRI went for $340mm
• TripAdvisor went further into China with Kuxun
  

Bust bust bust. The Global F'n Crisis had casualties

• Roamfree went into administration as the BOOT had to press delete on comment after comment
• Offline travel maybe dying but I had 3+3 recommendations on how it can save itself
  

Talk talk talk. The BOOT went conference crazy

• Talked EveryYou at WebInTravel - even though a back injury prevented by from actually going
• Joined the Kevin and Gene army of nodes and wrote 8 tnooz posts on subjects as varied as Augmented reality, Lonely Planet, Google, New Zealand and the Do over
• Overheard intermediaries and suppliers sharing war stories at NoVacancy
• EveryYou launched at TRAVELTech (see below)
• Another amazing week at PhoCusWright
• Spoke at Ad:Tech
  

Track track track - kept my eye on big Asian online players that are active in the market but quiet in the results arena.

• Tracking Google - broke the story first that Google meta-search was coming
  
• Tracking AsiaRooms and their TUI A&S stablemates
• Tracking Agoda, finally getting my hands on a Citi reporting estimating their turnover at $244mm for 2009 and early integration with Booking
  
• Tracking MakeMyTrip and claims they have made US$5mm off $500mm in gross sales
• Tracking Lonely Planet and their online plans
• Tracking Kayak and the private sale plans and follow up with Jetsetter CEO Drew Patterson
  

Theory theory theory

• Laid out my predications for 2010
  
• I introduced the concept of EveryYou - arguing that the future of online travel is “The development of a specific and targeted recommendation of one based on the unique combination of desires, needs and interests of each individual at any moment in time”
• Posted my thoughts on the secrets of innovation
• Mused on my 3 rules for a UGC start-up
• Pondered what next for Google in online video marketing
  

Puff Puff Puff - away from the industry I also posted

• More business traveller tips
• More seat reviews
• Introduced the SkyMall follies
• First Class is dead!

I haven't run out of things to say yet, so if you're still listening, then I will keep typing.