Comments on: And why ClearTrip is supporting India’s offline travel agents and wants to stand by them?

By: Unmesh

Unmesh — Fri, 15 Aug 2008 12:22:24 +0000

There could be opportunity in doing what Amazon did to mom-n-pop booksellers (i.e. provide an online front and generate leads). So I go to cleartrip to book a travel package – and end up buying it from a local TA with Cleartrip-backed service guarantees. Cleartrip takes a cut for making the connection.

By: Hrush

Hrush — Thu, 14 Aug 2008 19:56:07 +0000

Ashish–I’m not sure where you picked up the signal that we are trying to get into operating an offline business, we simply stated our sympathies for those agents that are operating offline businesses.

We think it’s unfortunate that a very large number of people stand to lose their livelihood.

By: Ashish

Ashish — Thu, 14 Aug 2008 15:22:03 +0000

Hrush
Thanks for sharing your comments. Essentially, I am not against the goodwill (and let me share that I love CT and the work you guys are doing! ).. But I am trying to understand the basic business model that OTAs are implementing.
I guess there are other distribution channels too that can be leveraged, but if an OTA gets into offline business – aren’t they doing the same thing (and can they really achieve economies of scale?)?
And that translates to operational cost which gets passed on to the customer.
Am I missing something? I’d like to know your views.

-Ashish.

By: Gautam Kshatriya

Gautam Kshatriya — Thu, 14 Aug 2008 14:59:51 +0000

Correct me if I’m wrong (and please do – I might be off the page completely!) but I was under the impression that while travel agents can be competition, many online ticket booking sites such as Cleatrip, in fact have tie-ups with these very travel agencies – e.g. exclusively use these sites to make books and receive a kickback? So while their shutting shop forces more people to go online, they’ve also lost a distribution mechanism?

Gautam Kshatriya
gautam.kshatriya@moneyvidya.com
http://www.moneyvidya.com

By: Hrush

Hrush — Thu, 14 Aug 2008 12:57:36 +0000

Gaurav–Cleartrip competes with the offline travel agents inasmuch as it competes with Yatra, but that doesn’t mean we have to be unsympathetic.

I’ve posted our view over at the Cleartrip blog:
http://blog.cleartrip.com/journal/2008/8/14/in-support-of-offline-travel-agents.html

By: Deepankar Biswas

Deepankar Biswas — Thu, 14 Aug 2008 12:34:16 +0000

Cleartrip is passing a message by putting that text on their website. Its imminent that there is a problem offline TAs would face. I would agree with Ashish, that the OTAs might be looking at the powerful distribution network, and the addressbooks of the agents.

By: Gaurav

Gaurav — Thu, 14 Aug 2008 11:51:17 +0000

The whole point of internet is to reduce information hoarding by so called experts (as Steven Levitt explains in Freakonomics). Internet sites make it easier for end users to get hold of information and take informed decisions. E.g using cleartrip or yatra or whater we have got, users can compare their options and take decisions. This is not very transparent when done by a offline travel agents. Afterall, their main onjective is to make more commission than care for customer’s benefit.

It is not very difficult to see why offline travel agents are difficult to beat in India as pointed out above and to that extent offline agents can be partners for online business. But what is this sympathy thing going on..Difficult to understand. Cleartrip is a business where they can pass on benefit to end user by scale of thier operation…not to show sympathy (genuinely sympathise )to other players. Would they show same sympathy to yatra.com if they have some problems in future!

By: Hrush

Hrush — Thu, 14 Aug 2008 10:17:00 +0000

Ashish–Cleartrip is also a travel agent, albeit an online travel agent. This makes us a part of India’s travel industry and we genuinely sympathise with the offline agents.

With respect to “killing” the offline travel agents, we’ve never believed that at Cleartrip. Travel agents all over the world are still thriving and growing, so it would be a little naive for us to think that online travel agents would “kill” the offline travel agents in a country where less than 5% of the population is online.