Online travel portals in India have reshaped the face of the Indian travel industry. The major travel portals seem to be thriving, with revenue touching millions of dollars. This class of verticals has definitely carved out its own space and validated that the market is prime, and ready to accept online travel as a credible industry.

After online recruitment, matrimony and travel are the two verticals that have emerged successful in India. On close inspection, you’ll find that the latter two share a common trait. Both, online matrimony and online travel portals have taken a online-offline hybrid approach. They may have started out as a pure online player but in the process of reaching out to the mass consumer, they have leveraged the offline channel as well.

Consider the following examples:

• Yatra announces tieup with network provider Hughes, enabling customers to access Yatra’s services through select HughesNet Fusion centers
• MakeMyTrip sets up counters at Spencer’s and Subhiksha
• Shaadi introduces Shaadi Point
• The BharatMatrimony Centres

I am not second guessing why these portals chose to embrace the offline channel. What I am wondering is if the offline channel was the key to push these portals beyond the realms of the fledgling startup to serious players in their respective market (moreso applicable to the travel portals). Also, which channel contributes what percentage of the revenue. If the offline channel contributes a higher percentage of the revenue pie, it creates an interesting conundrum because venturing into the offline channel increases the costs as well. Not to mention the logistical issues and operational overhead involved. Buying and developing your own assets for an offline presence maybe be cost prohibitive. A tie-up with an existing retail chain would be more economical and currently, that seems to be the preferred way to reach the mass consumer. This online-offline space is where I’m hoping to see some real innovation in the Indian context.

Moreover, it sends a clear message to other emerging startups targeting the mass consumer – go hybrid if you want to step up the game. Else, remain at the mercy of the miserable Internet penetration.

I can understand the business sense for these portals to have an offline presence. That however, doesnt keep me from wondering how ironical the scenario is – the very business that emerged to exploit the benefits of the Internet is having to go the old fashioned way to make it big .

What do you think ? Is the hybrid (offline+online) one of the keys to the success of these portals ?
How would have these portals shaped up if they chose to go with a pure online approach ?

This entry was posted on Tuesday, July 17th, 2007 at 6:15 pm and is filed under Entrepreneurship, Internet. You can follow any comments to this entry through the RSS 2.0 feed. Responses are currently closed, but you can trackback from your own site.