Studied the customer perception and their buying behavior towards Online Travel Agencies (OTA). Studied the challenges faced by OTAs to convert a potential buyer into a customer and the reasons why traditional agents are successful in spite of a strong emerging trend of buying online. Identified strategies, based on the results of market research and analysis through various models, that OTAs can implement in order to overcome advantages enjoyed by the traditional travel agents

1. 06-05-2015
CRP 2 - S P Jain School of Global Management
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2. Online Travel Agents
- Customer Perception
Group 1 – MGB CMM
Ameya Sonkusale
Eesha Bahl
Kajol Ghosh
Sagar Hastak
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3. Travel Itinerary
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• Aims and Objectives of the Research
• Three modes of booking
• Research Methodology
• Primary Research Analysis
• SWOT Matrix
• Marketing Strategies for OTA’s
• Research Challenges and Learning's

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 To understand the Consumer Behavior patterns while using the online
travel agencies for making leisure travel bookings in Sydney
Objectives of the Research
• To Understand the customer perception and their buying behavior towards
OTAs.
• To study the challenges faced by OTAs to convert a potential buyer into a
customer.
• To identify strategies the OTAs can implement in order to overcome
advantages enjoyed by the traditional travel agents.
AIM

5.  Online
 OTA’s & Direct Supplier Websites

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CRP 2 - S P Jain School of Global Management
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Modes of Bookings
 Offline (Brick and Mortar)

6. Strategic Framework
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Market Research
Market Analysis
Corporate
Perspective
Strengths
&
Weaknesses
SWOT
Firm’s
Capability
Cost
Advantages
Differentiation
Advantages
Step 2
Market
Perspective
Opportunities
&
Threats
SWOT
Market
Attractiveness
Size of market
Growth of market
Competitive
Structure
Cyclicality
Market Risks
Step 1
Marketing Planning
Step 4 - Marketing Strategies
Increase Volume / Productivity
Distribution
Strategy
Promotion
Strategy
Price
Strategy
Step 5
Marketing Mix
Brand Strategy
Product
Strategy
Segmentation
Step 3 Market & Segment Selection
Research
Identify segments
Identify Segments
Target
Identify most attractive segments
Attractiveness of Segments
Positioning
Select most attractive segments
Select Segment
CRP 2 - S P Jain School of Global Management

7. Primary Research Methodology
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Primary
Research
Qualitative Feedback
Prepare a Discussion Guide
based on key findings from the
Literature Survey
Meet Customers and take their
feedback.
Consumer perception survey
Identify consumers of both
Online and Offline Travel
Agents
Disparity
Analysis
Factor
Analysis
Cluster
Analysis
Inference
Learning's &
Recommendations
Challenges
and
Limitations
CRP 2 - S P Jain School of Global Management

8. 06-05-20158
Qualitative Research
Features
in OTAs
Preferred
Modes of
booking for
Domestic
and
International
Travel
Choices
between
different
modes of
booking
Choice
and
Nature of
booking
Loyalty to
particular
OTA
Concerns
while
making
Bookings
CRP 2 - S P Jain School of Global Management

9. 06-05-20159
Quantitative Analysis
Disparity between customer perceptions and Industry claims
Point of Difference Customer Perception Industry Claim
International Travel Bookings
• 45% preferred Brick & Mortar for
booking international flights
• 46% preferred Direct Company
Websites for international hotels
• Direct company websites
preferred for international flight
bookings
• Brick & Mortar preferred as
compared to OTAs and Official
Company Websites for hotel
bookings
Domestic Travel Bookings
• 55.1% preferred OTAs for booking
domestic flights
• 47% preferred Direct Company
Websites for domestic hotels
• OTAs preferred as compared to
Brick & Mortar and Official
Company Websites
Domestic Holiday Packages
• 49% preferred OTAs for domestic
holiday packages
• OTAs preferred as compared to
Brick & Mortar and Official
Company Websites
International Holiday Packages
• 44% preferred OTAs but 41% of the
remaining preferred Brick and
Mortar system
• Brick & Mortar preferred as
compared to OTAs and Official
Company Websites
CRP 2 - S P Jain School of Global Management

10. MARKET ATTRACTIVE INDEX FOR OTAs
SR. NO. Market Attractiveness Matrix: FACTORS
CURRENT
RATING (1- 7)
FUTURE
RATING (1- 7)
1 Size of the market (Scale: 1= small, 7 = significant) 5 6
2 Growth of the market (Scale: 1 = low, 7 = high) 5 3
3 Competitor hostility (1 = high hostility, 7 = low) 5 2
4 Market Risk (Scale: 1 = high, 7 = low) 4 2
Overall Average Rating 4.75 3.25
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CRP 2 - S P Jain School of Global Management
Market Analysis

11. DIFFERENTIAL POSITION MATRIX FOR AN OTA wrt Direct Supplier Websites
SR. NO. Differential Position Matrix: FACTORS
CURRENT
RATING (1- 7)
FUTURE RATING (1- 7)
1 Easy of payment (Scale: 1= small, 7 = significant) 4 3
2 Holiday tours and packages (Scale: 1= small, 7 = significant) 6 6
3 Cab pick and drop service (Scale: 1= small, 7 = significant) 4 2
4 Advertisements (Scale: 1= small, 7 = significant) 5 5
5 Customer Care (Scale: 1= small, 7 = significant) 5 6
6 Reward incentives (Scale: 1 = low, 7 = high) 5 3
Overall Average Rating 4.83 4.17
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Differential Position/Cost Advantage MATRIX FOR OTAs wrt BRICK & MORTAR
SR. NO. Differential Position Matrix: FACTORS
CURRENT RATING
(1- 7)
FUTURE RATING
(1- 7)
1 Ease of planning an itinerary (Scale: 1 = low, 7 = high) 2 4
2 Human Consultation & Guidance (Scale: 1 = low, 7 = high) 1 2
3 Simulated Experience Of Destination (Scale: 1 = low, 7 = high) 5 6
4 Value for money tours and packages (Scale: 1 = low, 7 = high) 5 6
5 Accessibility (Scale: 1 = low, 7 = high) 5 7
Overall Average Rating 3.6 5
CRP 2 - S P Jain School of Global Management

12. 06-05-201512
MaintainHarvestDivest
GrowthMaintainHarvest
Growth/
enter
GrowthDivest/
growth
Differential Position
Disadvantaged Average Advantaged
High
Medium
Low
MarketAttractiveness
1 7
1
7
3.5
3.5
MaintainHarvestDivest
GrowthMaintainHarvest
Growth/
enter
GrowthDivest/
growth
Differential Position
Disadvantaged Average Advantaged
High
Medium
Low
MarketAttractiveness
1 7
1
7
3.5
3.5
Strategic Characterisation Matrix
OTA’s v/s Direct Suppliers OTA’s v/s Brick & Mortar
CRP 2 - S P Jain School of Global Management

13. SWOT – OTA’s
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MARKET ATTRACTIVENESS
OTA’s CAPABILITIES
(DIFFERENTIAL POSITION)
OPPORTUNITIES THREATS STRENGTHS WEAKNESSES
SIZE OF THE MARKET
Expected to increase:
Technology + Awareness
-NA-
GROWTH OF THE
MARKET
-NA-
Slowing: Slowly reaching
its saturation point +
Marketing will play a
major role
COMPETITIVE
STRUCTURE
-NA-
New firms + Brick &
Mortar opening their own
websites
MARKET RISK -NA-
Decreasing Customer
Base: Stiff competition
from Company websites
DIFFERENTIATION -NA-
Access to the same
technology. Efficient
utilization of available to
resources will be the
differentiating factor.
COST FACTORS -NA-
Better technology &
resources at lesser price

14. Factor Analysis
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Rotated Component Matrixa
Component
1 2 3
Ease of cancelation .790
User friendly interface .782
Customer Care .697
Easy of payment .684
Low Price .671
Time while booking .668
Advertisement .811
Brand popularity .805
Online reviews .702
Referrals from friends and Relatives .687
Email and SMS alerts .843
Cab pick and drop service .794
Holiday tours and packages .700
Mobile Application .674
Extraction Method: Principal Component Analysis.
Rotation Method: Varimax with Kaiser Normalization.
a. Rotation converged in 6 iterations.
OTA Selection
factors
Core Features
Ease of
cancelation
User friendly
interface
Customer
Care
Easy of
payment
Low Price
Time while
booking
Brand
Advertisement
Brand
popularity
Online
reviews
Referrals from
friends and
Relatives
Extended
Features
Email and
SMS alerts
Cab pick and
drop service
Holiday tours
and
packages
Mobile
Application
CRP 2 - S P Jain School of Global Management

15. Cluster Analysis
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Distribution in Clusters
Core
Features
Brand
Extended
Features
1. Economic Traveller
Core
Features
Brand
Extended
Features
2. Impulsive Traveller
Core
Features
Brand
Extended
Features
Perks Lover
 These form 28% of the sample.
 43% of these are females.
 61% of these have an annual income of
less than AUD $ 50,000.
 73% of these fall in the age group of 18-
40 years.
 90% of these people have a short length
of stay of less than 7 days.
 These form 29%.
 63% of these people have an average
length of stay between 5-7 days.
 Majority, 81%, of these are male.
 These are distributed over all age groups.
 These form a large
chunk of 43%.
 58% of these spend 5-7
days on an average
during their leisure trip.
 67% of these are male.
CRP 2 - S P Jain School of Global Management

16. Mode of Booking Predictor Model –
Discriminant Function
 Mode of Booking = 0.675 (Extended Features) + 0.613
(Brand) + 0.361(Core Features)
 After getting the values for the customer rating on
Extended features, Brand and Core Features, we will get a
score.
 Score can be interpreted as follows:
 1 : OTA
 2 : Offline Travel Agents
 3 : Direct Supplier Websites
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CRP 2 - S P Jain School of Global Management

17. Marketing Strategy – 4P’s
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CRP 2 - S P Jain School of Global Management
Integration with
Offline Travel Agents
Improve Safety of
Personal and
Financial Details
Use Big data to
convert information
seekers to actual
customers.
Provide more
flexibility to
customers
Follow a Holistic
Approach
International Travel
and Holiday
Packages
Add extended
services like Mobile
application(Multi-
screen) & cab drop
services.
E-marketing
Real time pricing
Charge extra
services at a
premium price
Reduce the
overhead/hidden
charges involved in
each booking
Engage Customers
through Social
Media
Efficient utilization
of
review/feedback
websites eg.
TripAdvisor

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Learnings and Inferences
3 Major Groups
of Customers to
be Targeted
Importance of
Brand and Extra
Features
Influence of
Social Media/
Internet on the
Industry
OTA’s Growth Key Challenges
CRP 2 - S P Jain School of Global Management

19. Key Challenges – Scenario Mapping
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Disagree Neutral Agree
Customer Perception
ImpactonOTASales
LowMediumHigh
Confidentiality
of Personal
Travel
Information
Sceptical of
making
bookings
Alone
Security of
Payment
Details
Rigidity of
Booking Credibility of
Information
Extra
ChargesCumbersome

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Further Scope of Research
Study the gaps
which are causing
OTA’s to fail in the
International Holiday
Segment.
Study the Cost
structure of OTA’s
and identify ways of
expanding bottom
lines
Influence of added
services like VISA
facilities on
International
Packages.
Limitations of Our Research
 Time constraint
 Cost restraints
 Limited sample size
 Limited Industry exposure
 Validation of the Questionnaire
CRP 2 - S P Jain School of Global Management

21. 06-05-201521
Learnings from the Research
Importance
of Literature
Review
Techniques to
approach and
engage
customers in
discussions
Importance of
designing an
appropriate
Discussion
Guide and
Questionnaire
Implementation
of Data Analysis
and Research
Methods
CRP 2 - S P Jain School of Global Management

22. THANK YOU !
 Q & A
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CRP 2 - S P Jain School of Global Management

23. Factors Affecting
Consumer Perception
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Consumer
Perception
User
Friendly
Interface
Time
Ease of
payment
Low prices
Brand
popularity
Referrals from
friends and
relativesAdvertisem
ents
Online
Reviews
Ease of
cancellation
Rewards and
incentives
Holiday tours
and
packages
Mobile
Booking
CRP 2 - S P Jain School of Global Management

24. SWOT Analysis
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OTA’s Strengths:
•Low Cost and
Accessibility
•Technology
•Intangible Product
•Dynamic Packaging
•Added services to the
customers
•The 5S approach of
marketing
Weaknesses:
•Unavailability of Real
Time booking facility
•Lack of synchronization
•Less Connectivity
•Unfavorable Cancellation
Policies
•Modes of Payment
Opportunities:
•Inherent Nature of travel
•Niche Market
•User-friendly Interfaces
•Big Data
•One stop Shop
•Untapped Markets
•Multi Screen consumer
behavior
Threats:
•IT costs
•Customer Loyalty
•Increasing Competition
with saturating Market
•Unfavorable relations
with some Vendors
•Economic and Political
Instability
UnfavorableFavorable
InternalExternal

25. Australian Travel Industry
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• The industry had 6.3 Million Leisure Visitors in 2014.
Source: 1. http://tra.gov.au/documents/ivs/International_Visitors_in_Australia_September_2014_Results_of_The_International_Visitors_Survey.html
2. http://www.tra.gov.au/publications/publications-list-1166.html, 2014
0 500 1000 1500 2000 2500 3000
Holiday
Visiting Friends and Family
Business
Education
Employment
Other Purposes
In Transit
No of Travellers(Thousands)
Visitors in 2014
9 895
9 248
7 034
1 217
24044
20173
8575
3412
0
5 000
10 000
15 000
20 000
25 000
30 000
Holiday Visiting friends
and relatives
Business Others
NoofTravellers(Thousands)
Domestic Travel
Interstate trips Intrastate trips

26. 06-05-2015
CRP 2 - S P Jain School of Global Management
26Integration of OTA’s
with Traditional Offline
travel Agents
Use of Offline agents for
Overseas bookings
Increased Use ! Cost-effective
technology
OTA’s Growth
and Market
share on the
decline
Fast Reaching
Saturation
point

27. Recommendations
 Integration with Offline Travel Agents
 Improve Safety of Personal and Financial Details
 Use Big data to convert information seekers to actual
customers.
 Add extended services like Mobile application(Multi-
screen) & cab drop services.
 Potential Market – International Travel and Holiday
Packages
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CRP 2 - S P Jain School of Global Management