Thomas Cook India recorded its highest ever revenue and profit in 2023-24. While its revenue went up 45% to ₹7,426 crore in FY24, its net profit leapfrogged to ₹271 crore from ₹10 crore in the earlier fiscal. It is obvious that the travel company’s growth has been thanks to the surge in outbound and domestic travel in the last two years. What was interpreted as revenge travel post the pandemic, hasn’t lost momentum, says Madhavan Menon, chairman, Thomas Cook India. “As we emerged from the pandemic, we clearly saw a dramatic consumer behaviour change and travel was a major beneficiary. The trend has continued. Barring one quarter when we had the heatwave and elections impact, the demand is back to normal. It may not be a 40%-50% growth in demand, but the appetite to travel is here to stay.”
According to a report by MakeMyTrip, holiday searches have increased 45% post the pandemic. Over 100 million people are searching for travel every year on the MakeMyTrip platform alone.
Menon says that the average age of the Indian traveller has dropped by 10 years. No longer is the Indian traveller waiting for a certain stature in his/her career to plan an expensive foreign holiday or even an exotic domestic location. “Indians want to take multiple short holidays instead of taking an expensive holiday once every three years. They still do that one expensive holiday once every three years,” explains Menon. No wonder Thomas Cook’s leisure travel business grew by 89% in FY24. These multiple short holidays are not necessarily in India. “Today, they are saying if you can sell me a domestic trip, compare that to whether I could go to south east Asia or Dubai for 4-5 days.” The MakeMyTrip report says the number of people taking over three trips in a year has increased by 25%.
Dubai, Thailand, Maldives and even countries such as Georgia and Azerbaijan are sought after destinations for short holidays. “Pre-pandemic we could count the number of passengers we sent to the Maldives because it was always viewed as expensive. Suddenly we found people wanted to go there as it was the easiest place to go to. An international holiday is no longer about going to Europe or the U.S. Indians today are far more experimentative. This, along with India’s stable growth narrative has turned attention towards Indian travellers as opposed to China. Menon says that several countries have amended their visa norms to welcome Indian travellers. “Close to 49 countries either have no visa or visa on arrival policy for Indian travellers. Pre-pandemic there were only five countries which offered visas on arrival to Indians.”
Apart from visas becoming easier to obtain, Menon also points out that expansion of flight, train and bus networks has also aided growth in the travel and tourism industry. “The re-emergence of Air India and expansion of IndiGo is going to allow passengers to travel to the Middle East, Central Asia, South East Asia. It will allow them to take a four-day holiday anywhere in this region. We are in a place where there is going to be sustained demand. Air India Express is looking at tier-2 cities and taking these cities and trying to connect to their network internationally. Similarly, when IndiGo starts getting its Airbus A321 XLR next year it will allow more travellers to access Europe from India. The barriers that are being formed around long-haul airfares will suddenly drop.”
The increase in travel appetite of consumers has forced Thomas Cook India to change the way it did business earlier, admits Menon. “We found that customers were not just walking into one of our branches to buy a holiday, they were approaching us online as well as calling our call centres. The distribution touchpoints suddenly changed, the questions that were being asked also changed. Earlier, they would say they wanted to go on a holiday but had no clue where they wanted to go. Now they come knowing what they want. The conversation now is whether they want to visit Chandigarh, Kasol, Dubai or Bangkok, but what kind of experience we can create for them over there. The experience quotient had suddenly broadened.”
This led the travel company to invest a lot more on technology. “We built technology during the pandemic. We had a bottom-up approach rather than bringing someone to do it for us. If you look at our costs today, wherever tech has come in we have reduced the number of employees and improved productivity. In terms of content, we have changed the way we generate content. Today, the content we generate is available to you online, through our call centres and through our branches. We have changed our position from being a source of information or explainer, to a facilitator. We are selling experiences,” says Menon.
Infrastructure improvement within the country has also led to exponential growth in domestic tourism. The MakeMyTrip report says that there has been a 30% growth in emerging tourist destinations such as Bhubaneswar, Lucknow and Ujjain. The construction of the Ram temple in Ayodhya increased focus on religious tourism, which went up by 97% in the past year. Menon feels that within the country there is still a massive demand-supply mismatch despite airlines widening their networks and launch of new trains.
“The Government has realised that if you build infrastructure around domestic tourism, it will attract international tourism. It’s a long-term view and will take time. Ayodhya for instance, is not ready to take the influx of tourists. Building infrastructure will take time. Moreover, the Indian tourist is not just looking at a temple experience, he/she is also looking at a food experience, and that infrastructure will take time.”
