Going Places With Travelguru

As I was catching up on some of the recent business magazines, I noticed a familiar face in an issue of Business Today. I had read quite a bit about the action in the online travel booking space, but wasn’t aware that an old friend-cum-batchmate was behind one of these startups. DV Ashwin, an HBS alumnus had created a Business Plan in the online travel retail space and this Biz Plan went on to win the second prize in the Biz Plan competition at Harvard. Ashwin teamed up with a fellow HBS alumnus to roll out Travelguru in India. They also managed to get a funding of $10 Million (Rs. 45 Crores) from Westbridge Capital Partners (now Sequoia Capital). Apart from domestic and international flight bookings, Travelguru also offers hotel bookings (in line with international sites like Expedia, Orbitz and Travelocity).

Travelguru operates in an increasingly competitive space. We already have players like MakeMyTrip, ClearTrip, YatraOnline and Traveljini. In addition to this, biggies like IndiaTimes and Rediff also have a presence in this space. To keep costs low, budget carriers like Air Deccan, Kingfisher and SpiceJet might try to promote sales through their own channels and websites. Given this landscape, it would be interesting to see how these travel portals evolve. I haven’t used any of these travel portals and hence don’t know how they stack up against each other.

(Courtesy: Business Today)

We very often notice that the final price we pay through a travel site (inclusive of taxes and fees) is much higher than the initial price (pre-tax price) quoted by the site. Travelguru seems to have understood this and is directly offering an “all inclusive” fare so that there are no hidden charges.

One of the biggest stumbling blocks to growth of the online business in India is the resistance of people to use their credit card online. This is one of the issues faced by people like Fabmall and Indiatimes and they already offer Cash on Delivery. Given that the transaction values are generally larger, travel portals need to necessarily rely on credit card payments. They should be hoping that the tech-savvy traveller will fuel the growth of such travel portals.