As business standard covered the news on launch of travelocity.com in india. It bring to me no surprise that travelocity has planned to follow a different strategy than its fellow competition yatra.com, cleartrip.com etc.
Travelocity.com is only offering hotel and other side trip reservations in India. They have opened the system with budget hotels available in smaller cities but it doesnt look like they will be a big hit in indian market they will be powering inventory other way around to global network bringing in more hotels other than one aggregated by GDS like amadeus,abacus or galileo.
Though travelocity’s entry is being welcomed by travel agents more than the customers as hotel inventory which was hidden behind the mystical world of GDS will really open up and travel agents will get access to small budget hotels in international locations. Currently none of the major travel portals in india offer international hotel reservation which is also looked upon as a constraint keeping in mind the big spenders who are really using internet to plan their holidays abroad are not able to get right price pictures from the travel 2.0 INDIA.
Commercially speaking the travel portals might be doing 500 crores of business but with 80% of business being dependent on air the operating margin tilt is surely not in their favor at the moment. The numbers quoted by business standard article linked also gives the total travel e-commerce volume which in india mainly means online Online Flight reservations.
If you look from travelocity’s perspective commercially its not a wrong bet as end of the day inventory consolidated can always be marketed on their international network if INDIA game doesnt really work out.