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Dissertation Project Report On A study on changing Trends in Travel Industry in India

Mohammad Sameem A0102211026 MBA- M&S Class of 2012
Under the Supervision of

Ms Sonali Banargee Department of Marketing
In Partial Fulfillment of the Requirements for the Degree of Master of Business Administration – Marketing & Sales At



I, Ms Sonali Banargee herby certify that Mohammad Sameem student of Masters of Business Administration – M&S at Amity Business School, Amity University Uttar Pradesh has completed the Project Report on “A study on reasons changing trends in travel Industry in India

MS Sonali Banargee Department of Marketing

Title of Project To study the changing trends in Travel Industry In India


That the work presented for assessment in this Dissertation Report is my own, that it has not previously been presented for another assessment and that my debts (for words, data, arguments and ideas) have been appropriately acknowledged.


That the work conforms to the guidelines for presentation and style set out in the relevant documentation.

Mohmad Sameem Date:…………….. A0102211026 MBA-M&S Class of 2013

The Rise of the Internet is undeniable and when it comes to marketing and selling travel, it is the Ideal tool. This can be attributed to growing infrastructure, interactive nature and accessibility. That and the fact that internet is one of the primary means through which consumers research both business and leisure travel. New media trend report recently showed that travel marketers are planning to increase their E-Marketing budgets by between 15% and 75% in 2013. And with the good reason; of the 12600 people surveyed by Travel Mole in 2010, 55% claimed to have regularly searched their holiday and compare prices online while a massive 73% HAD VISITED the internet travel related blog sites to read fellow travelers feedback around holiday and destinations. Keeping the finger on the pulse of trends will allow marketers to anticipate change in the industry and adapt their strategies accordingly

E-travel Services: E-tourism industry has been ranked as a prime sector in e-commerce where the Internet has changed the traditional way of providing travel services by developing e-travel services and enabling consumers to interact directly with tourism providers. Today, travelers can look for travel information, book hotels and purchase airline tickets via the Internet. Parallel to the change in the tourism industry, there is also a change in consumer attitudes towards the development of the Internet. Nowadays, more travelers prefer to make their travel plans and use travel services via the Internet due to its' convenience, low prices, simplicity of looking for information as well as its ability to save time. Internet has introduced a lot of possibilities that changed the consumers’ behavior. Consumers are able to interact directly with services providers, which allow them to identify and satisfy their continually changing needs for tourism products. Plus, it is possible to reduce the ambiguity related to the products via forums, or to make use of an immediate control over the quality of products supplied. Travel service providers are motivated to deliver online travel services that enable them to obtain a greater share of the travel marketplace. Travel service providers are increasingly tending to deliver comprehensive, personalized and up-to-date online travel services in order to meet their customers' demands. With the increasing adoption of e-commerce, online transactions in the tourism industry are continuously growing. The impact of the Internet on the tourist's behavior:

Many studies in online consumer behavior have run to explore how consumers adopt and use online purchases. Specifically, the emphasis was on the antecedents of consumer online purchasing intention and adoption. Companies, however, have started to realize that the first step towards overall success is the initial adoption by consumers, and they should maintain a longterm relationship with loyal customers by considering the consumer continuance behavior (repurchase). The online consumer behavior encompasses three main elements: Intention, Adoption, and Continuance. Christy et al. associated the three elements together and formed a base model for the development of an online consumer behavior framework. The topic of online tourist behavior in terms of Internet use for travel planning has been examined under various contexts. It was determined the factors influencing user's continuance intention to use e-travel services. The results of his study highlighted the importance of satisfaction in predicting the continuance intention to use e-travel services. Another study is conducted to examine the relationship between consumer's perception of e-shopping characteristics and their intention to adopt e-travel shopping. Additionally, some studies addressed the tourist behavior in particular countries. It was studied the Internet shopping adoption for travel services in India, he identified the profile of Internet shoppers and the antecedents of Internet shopping adoption for Indian travelers. It was examined the Internet usage for travel information and shopping in India. They emphasized the factors that influence the use of e-travel services. Moreover, Vincent has studied the international travelers' behavior in using the Internet, and applied his study to travelers from many countries. He concluded that time savings and convenience are the two main considerations of Internet users. Shopping on the internet has become one of the most popular activities conducted in World Wide Web. Since 1991, when e-commerce became possible on the internet, thousands of businesses have taken part. Presence of companies on the internet expanded in start of 21st century after secure connections and electronic payments were developed. Then the customers quickly learned to purchase goods and services from them. Companies today can conduct business worldwide and thus the global marketplace is being created. Political, cultural, economic and geographical borders may limit the marketplace. When the company wishes to attract consumers worldwide the sensitiveness to these factors is essential and makes succeeding on the internet so challenging. Internet is the new land of opportunities which, in the long run, may possibly become as commonplace a function as any local shopping mall. Therefore it is no

wonder that increasingly more businesses want to engage themselves in it wishing to expand customer base and, as the trend today is, become internationalized. Any business, whether traditional or electronic, needs marketing. It is a fatal error to think that because the business is located on the internet it would not require marketing. Marketing the company site, the storefront where business takes place, is necessary both on and off the internet. Conducting such commerce is not alone sufficient for actually making sales. E-commerce, the subset of ebusiness, focuses on transactions.

Amal A. Al Rashee and Abdulrahman A. Mirza Objective:Attitudes towards E-Travel Services in Saudi Arabia, 2011 Abstract:The Internet revolution has led to vital changes in providing travel services. Etravel services play a significant role for travel services providers. The aim of this paper is to study the online consumer behavior in the context of Saudi Arabian travelers. It examines the current usage of the Internet for searching travel information and shopping for travel deals among Saudis. It identifies the common characteristics of Saudi travelers and their behavior during planning their trips online. Moreover, it evaluates the level of adoption of e-travel services among Saudi travelers by assessing satisfaction toward these services and the intention to use them in the future. A survey conducted among Saudi Arabian adult Internet users shows that approximately 74% have used e-travel services at least once. Findings indicate that men with higher monthly income and higher Internet experience are more likely to use the Internet for online purchase of travel products. Information Technology (IT) is rapidly growing in The Kingdom of Saudi Arabia (KSA). PC sales are the largest in the Arab world. Saudi Arabia‟s IT sector is growing at a rate of 9.3%. According to Wikipedia, the currently estimated population of Saudi Arabia is around 28 million. The use of e-commerce services is increasing quickly by Saudi Arabian population. The most recent research showed that 3.5 million internet users or 14.26% of the Saudi population were engaged in e-commerce transactions. The results of the report indicate the country‟s emergence as an ideal market for e-commerce activities among the developing countries in the Middle East region. Information and communication technologies (ICT) have led to an increasing impact on the

tourism industry. With the advent of new forms of ICT, a novel type of tourism, e-tourism, has emerged and transformed the international tourism industry. Now, e-tourism occupies a prominent place in the electronic market. The low cost of e-commerce gives both businesses and consumers a new and powerful channel for information and communication. Travel products and services appear to be well suited to online selling because they own the characteristics that can function in the electronic environment. Surveys have shown that travel products are among the most popular products to buy on-line due to the intangible and digital character of the distribution of tourism products. The Internet is a medium to provide on line access to travel industry consumers at worldwide destinations. Online Consumers‟ behavior is different in nature from traditional consumers' behavior due to the unique characteristics and interaction of technology and culture. As online channels are becoming increasingly important for businesses worldwide, researchers and marketers try to understand customers‟ online behavior. This paper studies the online consumer behavior in the context of Saudi Arabian travelers. It explores the current usage of the Internet for searching travel information and shopping among Saudi Arabian travelers. It identifies the common characteristics of Saudi travelers and their behavior during planning their trips.

Isaac J. Gabriel

Objective:Succeeding in a modern online travel marketplace: what do consumers need from a travel reservation web site? Abstract:Online travel industry has been growing at a fast pace over the last several years and is expected to grow at a steady rate in the future. Since this market is very attractive, it becomes very competitive. In order to survive the competition, online travel providers need to make sure that their sites offer features that are critical to consumers. This paper reports on results of an empirical pilot study that identified dimensions consumers use when selecting travel reservation web sites for their travel needs. Using current literature, a set of characteristics or features of travel reservation web sites was identified. Then a survey was constructed for subjects to rate these characteristics/features against each other. Data was analyzed using multidimensional scale analysis. As a result of statistical analysis, critical dimensions online consumers use to purchase travel packages on the Internet were identified. This research identified two such dimensions: 1) Reliability & Information, and 2) Ease of Use & Reassurance. Consumers need to be confident that the site is reliable and their personal information is being handled adequately. In addition, there is an urge to get more information, whether it is related to their traveling destination or, simply, consists of comments and opinions of fellow travelers. Moreover, consumers are looking for intuitive and user-friendly web site interfaces as it has always been the case in the past while preferring to have a choice of using advanced search capabilities when needed. Finally, as it was critical in the past, consumers wish to get reassured that adequate secure technologies were utilized in the transmission of sensitive data when interacting with the web site. Another interesting observation is that securityrelated features remain to be critical to online consumers as it was in the past.

Elhaj, Malik Objective:Factors that contribute to consumers' perceptions of online and traditional travel reservation systems, 2012 Abstract:This study consisted of an exploration of consumers' perceptions towards online versus traditional flight reservation methods. In addition, the factors that may influence consumers' perceptions were explored. Two research questions were posed for this study, addressing (a) consumers' preferences for traditional versus online reservation systems, and (b) the factors that influence consumers' preferences for traditional versus online reservation systems. The results indicated that price was the most important factor in determining the method of making reservations, with personal communication, rules and regulations, available information, and brand name loyalty also being important factors. The findings of this study provide useful information to various stakeholders in the travel industry to improve the quality of their services. In addition, recommendations for effective competition between the two flight reservation methods are provided. Dimitrios Xanthidis and David Nicholas Objective:Consumer preferences and attitudes towards e-Commerce activities, 2010 Abstract:This is the second part of a study on consumer preferences and attitudes towards the internet technology and e-Commerce activity in Greece. In this second part the authors build up on the results of the first part which investigated the role of the internet technology and the frequency of its use in everyday life in the country. More electronic transactions related issues were studied i.e. the ease and comfort of using plastic money, the types of products

and/or services most preferred to be purchased or hired online, the obstacles that block almost the whole internet user population in the country from engaging such transactions. Unfortunately the results are not positive of the current situation in the country and the projects seem to be rather pessimistic at least for the near future of e-Commerce in the country. In the first part of this study the authors discussed about the role of the internet in everyday life in Greece and the frequency of the use of the new technology. This investigation was necessary in order to enable the authors draw conclusions as to what are the reasons behind the stagnation of eCommerce growth in the country. The result of this research was two-fold. One, the majority of individuals (about 67%) uses the internet on a weekly basis whereas only 33% of them use it on a monthly basis. This fact verified the growth of the information society so far encouraging the motivation for its further development. The second, however, revealed a general confusion among the internet users and non-user alike as to the actual role of the internet in everyday life, be it an informative or a working tool. The above results look quite promising. However, a nice-looking and well-structured building may satisfy the people that invested in it, those that built it and the passersby gazing at it. However, until and unless consumers and/or companies use it, it will remain an investment waiting to be paid back and it will not be too long before the specter of bankruptcy knocks on the door. This, of course, is also true of the information society grown in Greece during the period 2000-2006

Lee, JungKook Objective:-

E-personalization and online privacy features: the case with travel websites, 2008 Abstract:E-personalization is the process of tailoring preferences to individual traveler‟s characteristics or performance on travel websites. E-personalization is used to enhance customer service or e-commerce sales. However, personalization also causes privacy concerns. Today‟s technology provides multiple opportunities for extensive data gathering and invasion of privacy. Privacy issue has recently received enormous research attention. This is mainly because of the advent of the web, and the trend of personalization. However, very limited research has been conducted to assess consumers‟ perspectives with regard to epersonalization and privacy from the travelers‟ perspective. The purpose of this study was to investigate consumers‟ perceptions and attitudes towards epersonalization and privacy features on travel websites. Previous research has consistently utilized either e-personalization or privacy concern as marketing tools. Our results show a moderate and direct effect of e-personalization and privacy on consumer‟s attitudes toward a company Website, which in turn has a strong effect on purchase intention, and also the importance of the privacy concern compared to personalization. The travel industry has undergone a process of disintermediation and reintermediation where the traditional travel distribution channels composed of small travel agencies have been replaced by a new generation of giant virtual travel ventures based on innovative online business models and backed up by advanced information technology. The increasingly sophisticated information technology has afford these business ventures to bring their tailored and personalized online services to an unprecedented new height. E-personalization is the process of tailoring pages to individual users‟ characteristics or performances on a website. Personalization is used to enhance e-commerce sales and consumer relationship management. Personalization is sometimes referred to as one-to-one marketing; because a website can be tailored to

specifically target each individual consumer. Many e-tailing companies have started to provide high degree of personalization to their customers. Personalization is identified as an important mediator of customer satisfaction and patronage behavior. While Customer satisfaction is the ultimate goal for the e-personalization and despite the fact that personalization is often cited as an essential component of online success, there have been very little empirical evidences for the effectiveness of this much hyped online marketing strategy.

Brian F. Blake Objective:Individuals‟ Preference Orientations toward Facets of Internet Shopping Sites: A Conceptual and Measurement Model, 2009 Abstract:Internet shopping is spreading around the world, spawning a wide range of research in information technology, communication, psychology, marketing, and related disciplines about this innovation. Many of the research questions require a viable taxonomy of site features in order to be investigated properly. Such research questions pertain to theory development, e.g., the role of site properties in the diffusion of this innovation, or the degree to which the impact of site/features varies with product/service domains or with characteristics of the user. Other applications involve methodological development, such as determining how to compare site feature preferences cross-nationally, and practitioner oriented investigations, such as devising web sites fitting the demands of specific subpopulations. A review of this burgeoning body of research suggests four conclusions. First, there is no single comprehensive listing of business-to-consumer (B2C) site features that is generally accepted. Several investigators have taken steps to provide broad coverage of a wide range of features. Others have narrowed their focus to specific product/service realms like destination travel or to site

features related to particular factors determining shopping behavior like perceived risk or trust. Still others have delimited analyses to specific forms of commercial web sites, such as sites allowing shoppers to consume services without direct assistance from service personnel. Second, the “features” (or attributes) have been conceptualized at various levels of abstraction running from the highly concrete to the highly abstract (e.g., “the purpose is clear” in van Iwaarden et al., 2004). Further, the facets sometimes are “objective” aspects of a site, such as the two examples of concrete features in the van Iwaarden et al. schema; still more often they are user judgments about the site‟s features, e.g., “well organized hyperlinks” and “customers enjoy visiting the website” in Liu and Arnett (2000). Third, features differ, often dramatically, in their importance in the eyes of site users and in their impact on shopping behaviors. Fourth, many research questions require the use of a set of site features that: a) has broad coverage of feature types, b) is theoretically linked to (and, hence, is interpretable in terms of) established theoretical constructs, and c) potentially can be applied to commercial sites for most product/service categories. CIJU T. R. NAIR Objective:Modeling Online Browsing and Purchase of Airline Tickets, 2009 Abstract:In this paper we investigate online purchase behavior at the basket level and model the multicategory purchases in the travel product category. While prior research in marketing has looked at browsing or individual category purchase decisions, we study consumers' online purchase of airline, car rental and hotel purchases together using a unique dataset of household-level dynamic click stream panel data. We use a two-stage model to study (i) the propensity of consumers to purchase a combination of products as a basket and (ii) the choice of the website where consumers will make those purchases. We then

estimate the propensity of consumers to purchase a particular combination of products in their basket from different websites. This behavior constitutes a high dimensional system of multinomial equations which are then solved using a simulation-based econometric technique. We find significant effects of {dependent variables} in determining consumer multicategory purchase behavior. Our results can help managers identify the major determinants of multicategory purchase as well as provide insights into cross promoting as well as upselling other products to consumers who visit their website. Brand choice and store choice models have been extensively explored in depth by marketing researchers in the retail packaged goods context (for a brief review of an extended framework see Ben-Akiva et al 1999). This stream of literature has also spawned interest in multi-category or basket purchases (Harlem and Lodish 1995), retail chain level demand (Baltas 2005), store choice models, category characteristics and promotional elasticies (Narasimhan, Neslin and Sen 1996) and understanding purchase incidence at the grocery store in more detail (Manchanda, Ansari and Gupta 1999). Scant attention has been paid to category demand in prior literature, despite its importance for retailers. Only a small body of research has considered the effects of individual brands on category sales and there has been so far little work at the category level in understanding demand or consumer behavior especially in the online environment. A recent extension of the online stream of literature into retail space has been furthering our understanding of shopping paths at the grocery store (Bradlow, Hui and Fader 2008). We believe this was to a large extent influenced by path analysis literature using clickstream data that became prevalent with the increasing dominance of the internet (Montgomery et al. 2004). In this paper we pursue this in the reverse direction and extend the work in multi-category and basket purchases in the retail space to online purchases thus contributing to the stream of literature on online basket purchases whilst drawing

motivation from the past literature that exists in the retail packaged goods context. L. Christian Schaupp Objective:A Conjoint Analysis of Online Consumer Satisfaction, 2005 Abstract:The ability to measure the level of customer satisfaction with online shopping is essential in gauging the success and failure of e-commerce. To do so, Internet businesses must be able to determine and understand the values of their existing and potential customers. Hence, it is important for IS researchers to develop and validate a diverse array of metrics to comprehensively capture the attitudes and feelings of online customers. What factors make online shopping appealing to customers? What customer values take priority over others? This study‟s purpose is to answer these questions, examining the role of several technology, shopping, and product factors on online customer satisfaction. This is done using a conjoint analysis of consumer preferences based on data collected from 188 young consumers. Results indicate that the three most important attributes to consumers for online satisfaction are privacy (technology factor), merchandising (product factor), and convenience (shopping factor). These are followed by trust, delivery, usability, product customization, product quality, and security. Implications of these findings are discussed and suggestions for future research are provided. Internet commerce involves the sale and purchase of products and services over the Internet. It was touted to have massive sales potential, with previous expectations of over $1 trillion by 2002. Yet, these expectations have fallen well short of the $1 trillion estimate, with the U.S. Census Bureau reporting that U.S. e-commerce sales in 2002 equaled only $43.5 billion and $70 billion in 2003. However, online spending is on the rise. Retail e-commerce sales in the second quarter of 2004 were approximately $15.7 billion, an increase of 23.1 percent from the second

quarter of 2003. E-commerce sales in the second quarter of 2004 accounted for 1.7 percent of total sales, while in the second quarter of 2003 ecommerce sales were 1.5 percent of total sales. Given the continual rise in online spending and its increasing influence on total retail sales in the U.S. further exploration of per person spending patterns is warranted. Clearly, consumers must be satisfied with their ecommerce shopping experience to acquire more goods and services on-line. Given the need to understand what users want in a Web site, it is important for IS researchers to develop and validate a diverse array of metrics to comprehensively capture the attitudes and feelings of online customers. What factors make online shopping appealing to customers? What customer values take priority over others? This study‟s purpose is to answer these questions, examining the role of several technology, shopping, and product factors using a conjoint analysis of consumer preferences to measure online customer satisfaction (e-satisfaction).

Zarine Susan George Objective:Factors Influencing Consumer Preferences While Choosing between Budget Airlines, 2011 Abstract:According to experts, the airline industry lost foothold ever since it got into a price war and relinquished its monopolistic position. And yet, it was in this scenario that budget airlines emerged. Budget airlines are an innovative business model which competes chiefly on price. They jostle with each other to provide the lowest fares by keeping their operating costs to the bare minimum. There are many ways by which airlines cut costs. Some of them are fast turnaround times leading to maximum utilization of the aircraft, using a single type of aircraft for easy maintenance, using secondary airports which have reduced landing fees, online booking of tickets saving on ticket printing costs

and agent commissions, less personnel per flight, use of budget terminals which have lower costs and have least frills which allows faster boarding and deplaning, doing away with or charging for frills such as seat covers, pillows, food, entertainment, newspapers, magazines, baggage and even drinking water. Budget airlines have been an instant hit ever since Southwest airlines introduced the concept in 1973. Currently, budget airlines are thriving. A bigger part of the revenues of budget airlines are coming from ancillary sources. This also helps them keep the ticket fare competitive. They own a third of the market share in the airline industry. They have forced high end carriers such as British Airways and Qantas to „dress down‟ and become leaner in order to stay in the market. With the entry of a number of new players in the market especially in Singapore and with rising fuel costs, budget airlines would not be able to compete on price alone for long. They have to find ways to differentiate themselves in order to stay ahead. This research intends to find out the predominant factors other than price which a consumer considers while choosing between budget airlines. Some of the factors which are being considered are Scheduling, Punctuality, Baggage capacity, Customer Service, Ease of booking tickets, Rescheduling and refund policy, Quality of food available in-flight, In-flight entertainment, Premium services such as priority boarding, seating, Ground handling services, Seating and general in-flight cleanliness etc. However, the research is not limited to these factors alone. Both primary and secondary research has been carried out. The secondary research mainly concentrates on the business model of budget airlines particularly those of the 6 budget airline based or operating out of Singapore. The airlines are Air Asia, Jetstar, Tiger Airways, Cebu Pacific, Lion Air and Air India Express. Primary research consists of questionnaire survey. The sample consists of 60 respondents. Statistical techniques have been applied to the primary data and corroborated with secondary data to gauge the important factors that influence customer‟s choice of budget airline, the most preferred and the least preferred airline in Singapore and the strong points and areas of improvement of each of these airlines.

Anton Bogdanovych, Helmut Berger Objective:Travel Agents vs. Online Booking: Tackling the Shortcomings of Nowadays Online Tourism Portals, 2008 Abstract:In this paper we present the findings of a study that aims at identifying the reasons that let many people still rely on traditional travel agents instead of booking their trips online. The prime motivation for investigating this issue is that it is impossible to have direct experience with the product prior to consumption in the domain of tourism. The Internet provides a powerful environment for the creation of virtual representations of tourism destinations allowing indirect experience that greatly surpasses the possibilities of traditional travel agents. However, the results of the study show that social interaction with travel agents, their expertise and the possibility to save time on search can be of even higher importance. So, we derived the “best of both sides” and suggest the application of an established methodology in the area of multi-agent systems, namely 3D Electronic Institutions, to the tourism domain in order to satisfy the growing demand on human assistance related to online inquiries and to offer customers cutting-edge visualization facilities. However, it becomes more and more difficult for traditional travel agents to compete with web sites that offer online booking possibilities. One of the main reasons for the increasing number of people booking online is that online experience has much greater potential in visualising travel destinations. 3D interactive tours, for instance, might be used to convey a clear impression of the travel destination and interactive on-demand videos may be shown online without interfering with other (in-store) customers. Daugherty et al. (2005) conducted a usability study comparing indirect experience (form-based web sites), virtual experience (web sites with 3D product presentation) and direct experience (direct product manipulation) in order to better understand consumers reactions on different product presentation methods. The study

showed that virtual experience provokes similar impressions as direct experience. Product knowledge and decision quality are both significantly higher when exposed to interactive 3D products than to static products presented in a form-based way. Additionally, Edwards et al. (2001) argue that one of the factors that makes virtual experience even more successful is its novelty since people that have not yet been exposed to 3D product presentations may simply be curious to experience it. Despite the aforementioned advantages, the mistaken idea that using 3D on the Web is far too expensive and too resource consuming greatly inhibited the proliferation of 3D applications in e-Commerce. Nevertheless, recent developments prove that in the future 3D applications may be faster and cheaper to create than quality photographs. Moreover, the broad availability of broadband Internet access supports this trend. Lee, Z. H.; Cheng, K. N. Objective:Predictors of customer preference for online versus offline air travel booking. Abstract:Airlines increasingly use their own websites to sell products directly to customers. Because Internet-based distribution is low cost, this means lower prices for the consumer. To compete with such sales channels, global distribution systems (GDS) firms have made ready-made online booking tools available for conventional walk-in travel agencies. This presents such agencies with a choice - to use online or more traditional offline methods in dealing with their customers. This study has two goals: to identify a small set of predictive factors that effectively forecast customer preferences, and to demonstrate the utility of such factors for predicting customer choices. We began by designing and executing a detailed questionnaire fielding some 300 respondents, then applied hypothesis testing to extract important factors from the data, and finally, used the logistic regression methods applied with these factors to

efficiently predict customer choices. The findings indicate that the majority of customers believe that online booking is cheaper and faster than offline. However, booking choice is strongly influenced by whether cost or service is the paramount emphasis. If customers want lower prices, they will typically book online. If they want service - such as help making special travel arrangements they will usually choose offline. Harrell Associates Objective:The Internet Travel Industry: What Consumers Should Expect and Need to Know, and Options for a Better Marketplace, 2002 Abstract:The online travel market continues to evolve, creating both risks and opportunities for shoppers. Since Consumer Reports Travel Letter (CRTL) conducted its assessment of travel Web sites in October 2000, many changes, both good and bad, have occurred. While a wide variety of airline ticketbooking sites remain, the market itself has become more concentrated. We see improvements in five key areas: The ability to get low fares, viable itineraries, ease of use, customer service and privacy and security policies. Yet we also see many problems remain to be solved. Some are merely growing pains of a relatively new business. Others reveal challenges created by the underlying characteristics of the travel industry itself. The traditional travel business, operating between the launch of deregulation in 1978 — the airline deregulation era of the late 1970s — and the onset of online travel in the midtolate 1990s, evolved with an integrated group of players — airlines, Computer Reservations Systems, travel agents and credit card companies — whose successes were interdependent. In other words, if an airline sold a seat and made money, so did everyone else in the chain. But the advent of online travel created new business models that altered the relationships among the key players. They became less interdependent and more competitive. Moreover, their two primary goals were now similar: First, generate revenue

and build customer loyalty by selling directly to consumers; second, improve profit margins by reducing transaction costs, primarily in marketing and distribution. Instead of sharing customers, now they began to compete for them. Providers such as airlines and hotel companies sought to reduce reliance on fees to travel agents and Computer Reservations System (CRS) operators by selling directly to consumers through Web sites. In response to this threat to their cash flow, CRSs followed suit, reducing dependence on airline and agent transaction fees (for example, Sabre‟s creation of Easy Sabre and the Travelocity Web site). The travel agents‟ response was to build online stores for leisure and business travelers. Credit card companies formed co-branded alliances with hotels and airlines to secure customer loyalty and supplier acceptance, and incorporated travel links into their online payment sites. As a result, today’s online travel market is highly competitive, but also reveals remnants of favoritism among providers and distributors, making consumer education critical. The evolution of the industry has renewed enthusiasm for government regulation. In June 2002, U.S. Transportation Secretary Norman Mineta named a former Maryland state transportation secretary to lead a nine-member congressional commission to investigate the business practices of airline sites and the independent ticket-booking sites to determine their marketplace impact. The commission is scheduled to report back to Congress in November 2002. Until standards exist — and in the online world, there are few but market forces — consumers who know how the various ticket-booking sites work can score bargains. However, in addition to demanding a certain level of expertise from consumers, airline ticket-booking sites also vary dramatically when it comes to matching bargain-basement fares with viable itineraries, good customer service, and strong privacy and security policies. Flying from New York to Miami via Dallas and back on four different airlines, for instance, is not a viable itinerary. Each site has advantages and disadvantages. Finding everything on one site can be challenging, but not impossible. It just depends on when and where you‟re going and when and where you book. Many of these challenges stem from the same issues faced by

consumers in the traditional brick-and-mortar marketplace (for instance, one airline‟s fare getting promoted over another based on its superior position on a travel agent‟s computer screen). However, online technology can exacerbate these challenges, and can even obscure elements of transactions the consumer could more easily perceive in the “real world.” Daniela Tatiana Objective:The Impact of Online Booking Systems on Customer Loyalty in Romania Abstract:The evolution of the Internet as a distribution channel is apparent in Romania as the number of Internet users and card holder‟s increases. This paper discusses the results of questionnaire and interview based research on the perceptions of 65 managers„of "brick and mortar" as opposed to virtual travel agencies„of the so-called phenomenon of "disintermediation" and its expansion or, in other words, the competitive impact of online bookings on customer loyalty and business and communication strategies used to protect themselves from its consequences. In spite of the increase by 10% of the use of Internet each year, more than half of the respondents are convinced that they can adapt their services, products and operations to retain their loyal customers. Over the last decade, public access to and the use of online booking systems has increased globally. According to the Centre for Regional and Tourism Research, Denmark, the European tourism market online increased from 20% in 1998 to 65.2% in 2009 and the use of direct sales channels online reached 66%. The Internet, this great "intermediary", became "a new distribution channel for tourism", acknowledged for its ability to stock and distribute information related to destinations, opportunities and tourist offers.) It was claimed that this situation had contributed not only to the launch of new products and services in tourism, but also to the changes in the offers of tour operators that strongly increased; this new channel "gives tourism business the

chance to improve its level of competitiveness and performance". Business "development" with Internet transactions is also due to the structural elements of tourism industry: Lewis and Semeijn claimed that "at present, this adopts the characteristics of a more decentralized market where any buyer has direct access to any seller". The Internet gives consumers the advantages they have not obtained from the other distribution channels so far including the possibility to communicate in a personalized manner with every consumer; "two-way communication" (interactivity and getting feedback); flexibility where information is updated at any time; the accessibility of information anytime by anyone, anywhere on the planet, irrespective of the number of users; exhaustive information; low prices; discounts; and the possibility to save time and reduce costs are the benefits that not only tourists enjoy when choosing the online market, but also the tour operators that want to do business in this way. Neelima Ruparel Objective:Internet Users‟ Perceptions and Attitude for Online Travel and Online Travel Portals in an Emerging Market: The Indian Context Abstract:Online travelling is the newest addition to the travelling ecosystem in India. The advent and proliferation of computers, coupled with the increasingly acceptable leveraging of the Internet has caused some major changes in the travel industry. Online travelling in India is yet at a very nascent stage. Travelling has not been a focus area but merely another application for engaging users when they are looking out for some quick results. The engagement level of most users has also been low with infrequent usage and loyalty. However all this is changing with the spotlight sharply focused on complete travel booking. The traditional means of procuring airline tickets and associate travel arrangements are rapidly changing. These changes are










makemytrip.com, yatra.com, etc) that claim to provide an easier, less expensive alternative to traditional methods of ticket procurement without sacrificing service quality. If travel marketplaces are to be successful then they need to understand their customers and what the motivations behind their actions are, when it comes to shopping for discount travel. This paper aims to report a descriptive study that investigated the perceptions of consumers in Ahmedabad city for online travel and online travel portals. Online consumer behaviour is a broad and interesting area of study that can benefit organizations in their efforts to market and sell travel products and services online. As consumers‟ perceptions and attitude towards online travelling is a prominent factor affecting actual buying behaviour, this research has tried to investigate a modest part of that area. Moreover due to increasing players in online travel industry, the consumers have different preferences and perceptions regarding them. Despite the growing importance of the internet as an information source for prospective travellers, as a marketing tool and as a way of doing business, there is a general lack of information related to perceptions of travellers for online travel products and services. Understanding their attitude is also of critical importance to travel marketers in formulating appropriate marketing strategies so as to fully exploit the developing potential of this new channel. Literature review revealed that researchers have tried to study online consumer shopping behaviour in general but no such specific study to understand consumers‟ perceptions related to online travel has yet been done. Thus, the study will provide insights about the Internet users‟ feelings towards information seeking and online travel booking and also help to know their experience, level of satisfaction and purchase intention in future. Thus the research study would be useful to online travel marketers to better develop appropriate strategies to enhance and promote e-booking to future users while retaining existing customers and also to researchers as well as academicians conducting research in this area in providing future direction.


3.1 Purpose of the study The purpose Behind the study was to Find out the changing trends in Travel Industry. Deep Kalra deservingly being called the father of the Online travel in India brought this magnanimous change in how people would book their travel tickets and the way they look at travel Industry. In his survey conducted it was found that travel Industry with a huge potential has been unorganized and small travel booking agents have been making a good average of Rs 1000 to 5000 on a daily basis through commission on air tickets. Not only that with this middle men charges the common consumer at his inconvenience had to pay at time a hefty price which would differ his chances of traveling through air in future The aim of the study is to find how the modern internet user is keen to book travel related services online rather than paying an extra amount to travel agents.

3.2 Research Design

Research methodology is the arrangement of condition for collection and analysis of data in a manner that aims to combine the relevance to the research purpose with economy in procedure. Research is conceptual structure within which research is conducted. It is a way to systematically study and solve the research problems. The steps which complete the process are mentioned below: -

a) Problem Identification

b) Development of Approach to problem

c) Research design formulation

d) Fieldwork and Data Collection

e) Data Preparation and Analysis

f) Report preparation and Presentation

3.3: Research Design:-

A Research Design is a frame work or blue print for conducting the marketing research project. The research is exploratory in nature. Explorative studies valuable means of finding out what is happening Exploratory research could be used for any of the following purposes: Formulate a problem or define a problem more precisely. Identify alternative course of action. Isolate key variables and relationships for further examination to seek new insights to ask questions and to access phenomenon in a new light.


Primary Data The first hand information bearing on any research is the one which has been collected by the researcher. The data here is collected through:

1:-A structured questionnaire

2:-Personal interview. Secondary Data

The data which has already been collected, compiled and presented earlier by any agency may be used for purpose of study. The data collected through:

1:-Various publications in form of annual reports, various papers and journals published from time to time. 2:-Through internet and Books. SOFTWARES USED:1. Microsoft Excel:- Used for storing the data. 2. Microsoft Word:- Used for report preparation. 3. SPSS:- Used for analyzing data

Sampling and sampling techniques Sample basically means a subgroup of elements of population selected for participation in study. And number of elements to be included in the study is known as sample size. Execution of the sampling process requires a detailed specification of how the sampling designs decisions with respect to the population, sampling frame, sampling unit, sampling technique, and sample size is to be implemented.

Sampling technique is broadly classified as: Non Probability Sampling Sampling technique that do not use chance selection procedures and rather they rely on the personal judgment of the researcher. In this study basically Convenience sampling. Non Probability Sampling Technique is used. Convenience sampling attempts to obtain a sample of convenient elements. The selection of the sampling unit is left primarily to the interviewer. In this type of sampling technique often the respondents are selected because they happen to be in the right place at the right time. Examples of convenience sampling include Use of students, church groups, and other members of social organizations. Mall- intercepts interviews without qualifying the respondents. Department stores using charge account lists.

Questionnaires included in a magazine.

People on the street´ interviews. Convenience sampling is the least expensive and least time consuming of all the sampling techniques. The sampling units are accessible, easy to measure and cooperative. In spite of these advantages, this form of sampling has serious limitations.

Many potential sources of selection bias are present, including respondent self-selection. Convenience sampling is not representative of any definable population. This study basically included mall-intercept as the sampling technique. And the sample size for the study taken is 200 people.


The study constituted of the feedback of the E-shoppers and their relationship with the Eretailers. Their experience as well as their views about the relationship with the E- retailers is been recorded.

Chapter 4: Data analysis and interpretations

Surveyed data was collected and coded in statistical computer package Ms-Excel and then further analyzed. The data has been analyzed with reference to the objective of the study. During the analysis various techniques were used to segment and define of customer profiles. Each question as asked to respondents with a purpose behind. The analysis will show how each question and data collected through them depicts the purpose behind the study.

Q:1: How often do You travel?
Frequently 47% More frequently19% Some times33% Never11% The Study therefore shows that Out of the 100 respondents being questioned 89% of people do travel which means Travel Industry has a vast scope in India. Q:2: How do you choose to travel Rail: 23 Bus: 11 Air: 57 Owned Vehicle: 9 The Study therefore shows that Out of the 100 respondents being questioned only 9 % of the travelers use their own vehicle, the remaining 91% of respondents use public transport, Air travel being the famous with 57%.

Q: 3: Are you aware of online travel bookings Yes: 98 No: 2

The study therefore revealed that 98% people are aware of the online travel booking. This shows the increased concentration of the online shopping trend India. Q: 4 : How do you book your Air/Rail/tickets ? Travel agents: 28 Online travel portal: 72 The Study therefore shows that Out of the 100 respondents being questioned 72% say that they use online travel portals such a makemtrip.com and yatra.com and Irctc.in to book their air/rail tickets. This shows the changing inclination towards the online portals since its introduction in India.

Q: 5 : Do You find it convenient booking your Tickets online? Yes: 88 No: 12 The Study therefore shows that Out of the 100 respondents being questioned 88 % of people find it convenient booking their tickets online. This shows the changing trends towards the online travel portals. Earlier consumers would hesitate to booking tickets online citing different reasons such as lack of knowledge, insecurity regarding payments and other reasons. But now the trend has reversed, people more want to book their tickets online.

Q: 6: What kind of products do you purchase over internet? Books: 19% Electronics: 17% Air/Rail/Tickets: 27% Hotels: 13% Clothes: 19% Cosmetics: 4% Groceries: 1% The Study therefore shows that Out of the 100 respondents being questioned, the online booking for air/rail tickets is increasingly the most among all the online shopping categories. Not surprisingly though because the online travel portals were introduced much before the other shopping portals.

Q: 7: Which method (or methods) of payment do you use? Credit card: 31% Bank transfer: 10% Net banking: 32% Cash on arrival: 23% The study therefore shows that net banking and credit cards are being preferred over bank transfers and other means of payment. However there is an increasing demand in cash on delivery and cash on arrival but due to its late inclusion not many customers have experienced the same. However the future studies are going to reveal how cash on delivery will be the favorite mode of payment for all the customers.

Q: 8: To what extent do the following sources help you decide which site to use for shopping online? ( Search engine) Great Deal: 57% Fair amount: 29% Neutral: 5% A little: 6% Not at all: 3% The study therefore reveals how search engines such as Google and Yahoo are being the most favored.

Q: 9: To what extent do the following sources help you decide which site to use for shopping online? [Personal Recommendation (friends/family)] Great Deal: 26% Fair amount: 51% Neutral: 9%

A little: 13% Not at all: 1% As compared to search engines not many in today’s time rely on recommendations on family and friends Q: 10: To what extent do the following sources help you decide which site to use for shopping online? [Special Offer I see] Great Deal: 29% Fair amount: 46% Neutral: 16% A little: 8% Not at all: 1% The offers on internet have been attracting customers a great deal as it has been revealed by our study

Q: 11: To what extent do the following sources help you decide which site to use for shopping online? [Online Advertising] Great Deal: 26% Fair amount: 51% Neutral: 10% A little: 10% Not at all: 3% Online advertisements (banner ads) powered by Adsense and Ad choice by Google have created a revolution in advertisement world with many online portals spending most of their budgets on banner Ads. Q: 12: To what extent do the following sources help you decide which site to use for shopping online? [V/Radio/Print or other advertisingnot at all] Great Deal: 26% Fair amount: 51% Neutral: 10% A little: 10%

Not at all: 3% There is a decline in print advertisements as most of the consumers find their information that they are looking for through Google and Yahoo. This decline in print media is giving rise to Internet advertisements.

Q: 12: Please specify to what extent the below mentioned factors concern you while making online
purchase? [not sure about SECURITY of transactions]

Great Deal: 27% Fair amount: 43% Neutral: 9% A little: 15% Not at all: 5% This study shows us that still many people are scared about making transactions online. However features like cash on delivery and cash on arrival are filling up the gaps.

Chapter 5: Conclusions and Recommendations

A survey was conducted online and trough streets. People age group of between 20 to 40 were being questioned and in our survey it was found that Internet users are increasing day by day and many people do no more feel hesitant to book air tickets/ rail tickets/hotels/holiday packages online. People no more feel unsecured about the transactions on the internet but however some people preferred cash on delivery and cash on arrival over the credit card and net banking. Search engines such as Google and Yahoo are playing major role in promoting the online bookings as they provide the basic platform through Ad words (By Google)

More over it was found out that Air tickets/Rail tickets are being booked more as compared to other product categories Avaible on the internet such as clothes, groceries, electronics and other items. The reason being quiet obvious the online travel portals such as make my trip and yatra.com were being introduced much before the other product category portals such as Flipkart.com, Myntra.com, Jabong.com. It was also found out those online advertisements such as banner Ads by Adsense and Ad choice( by Google) are attracting much attention over the traditional Print Ads. However its strongly recommended that cash on arrival and cash on delivery be promoted more and more as still many number of customers hesitate make payment transfers through their credit/debit cards or other transfer options such as net banking and bank transfers as they hesitate to share their bank details citing theft and misuse of the same

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