INDIA Market Profile. $ bn Potential to be worth by ,000. $0.8bn. 10.3m. Overview. Aviation routes from India to Australia 3

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1 Market Profile Overview In 2014, India was Australia s 10th largest inbound market for visitor arrivals, 11th largest market for total visitor expenditure and sixth for visitor nights. Findings from Tourism Australia s Consumer Demand Project indicate that Indian leisure travellers look for (in order of importance) safety and security, world class beauty and value for money when choosing a holiday destination. Australia s coastline, wildlife and island experiences generate the greatest appeal, with aquatic wildlife rating as the most preferred Australian experience. $ bn Potential to be worth by ,000 1 Visitor arrivals (á 17 per cent) Aviation routes from India to Australia 3 New Delhi Dubai Ahmedabad Kolkata Hong Kong Mumbai/Bombay $0.8bn 2 Total spend (á 15 per cent) Hyderabad Chennai Bangalore Kuala Lumpur Bangkok Singapore 10.3m 2 Visitor nights (á 8 per cent) Sydney Sep-Nov and Feb-Apr Booking peak period Melbourne Which airlines 3 do Indian visitors use to travel to Australia? 4 Airline Singapore Airlines 29% 31% 31% 29% 29% Malaysia Airlines 15% 20% 24% 25% 27% Qantas Airways 15% 18% 12% 10% 12% Air India 0% 0% 0% 6% 11% Thai Airways 21% 14% 16% 13% 5% Cathay Pacific 5% 5% 4% 4% 4% Air Asia X 2% 2% 1% 2% 3% Others 12% 11% 11% 11% 9% Total 100% 100% 100% 100% 100% May and Dec Travel peak period 1. Source: Department of Immigration and Border Protection as at year ending December Source: International Visitor Survey, Tourism Research Australia, December 2014 quarter 3. Source: CAPA-Centre for Aviation, Tourism Australia analysis 4. Table includes direct and indirect capacity. Source: Department of Immigration and Border Protection Visitor profile 2 HOLIDAY VISITING FRIENDS AND RELATIVES BUSINESS 29,200 arrivals (19%*) 58,900 arrivals (39%*) 26,400 arrivals (18%*) $3,716 spend per trip $2,110 spend per trip $4,578 spend per trip $154 spend per night $34 spend per night $173 spend per night 28% repeat visitors 56% repeat visitors 47% repeat visitors Data refers to an average of * Refers to share of arrivals of respective purpose of visit 1 INDIA Market Profile 2015

2 Market Performance The charts on this page provide a trend overview of visitor arrivals and expenditure by main purpose of visit and also the age demographic split of leisure* visitors and expenditure (based on latest 12 months data). Visitor arrivals Visitor arrivals by main purpose of visit Visitor arrivals (000s) ,000 Visitor arrivals (000s) Visiting friends or relatives Holiday Business Employment Other Education Visitor expenditure Visitor expenditure by main purpose of visit Total trip spend ($bn) $0.8bn Total trip spend (A$000s) Education Visiting friends or relatives Employment Holiday Business Other Arrivals by age Expenditure by age yrs 24% yrs 27% 60 yrs & over 8% yrs 14% yrs 29% 60 yrs & over 20% yrs 28% yrs 50% * Leisure refers to main purpose of visit of holiday and visiting friends and relatives Age profile data refers to an average of Source: Department of Immigration and Border Protection International Visitor Survey, Tourism Research Australia 2 INDIA Market Profile 2015

3 Aviation Landscape Indian visitors can fly from a number of cities such as Mumbai, Delhi, Bangalore, Chennai, Kolkata, Ahmedabad, and Hyderabad, to hubs including Singapore, Kuala Lumpur, Bangkok, Hong Kong and Dubai. From these hubs, connections to Australian cities are frequent. In 2014, 29 per cent of Indian visitors to Australia travelled on Singapore Airlines and 27 per cent on Malaysia Airlines. As at 2014, Air India has grown to 11 per cent market share, and close to Qantas share (12 per cent). Thai Airways share continues to decline (currently 6 per cent) (see chart page 1). In 2014, direct capacity from India to Australia increased by 187 per cent following Air India launching Australian (Sydney/Melbourne) services in August Average loads during 2014 were 73 per cent, down two percentage points compared to Other than December to February, July and October, average load factors hover around 60 per cent. In mid-2015 Air India delinked its Sydney and Melbourne services and commenced operating nonstop services to both of these destinations in an effort to improve average loads and yields. Negotiations for the ASEAN single market agreement, which is expected to fully liberalise air travel between member states in the ASEAN region, are ongoing however there are hopes it could be finalised in Once the agreement is ratified by all members demand is expected to be diverted away from Australia in the short term as intra-asian travel is stimulated. India s aviation sector has undergone rapid transformation since 2003, with the new government (that was elected in May 2014) aiming to introduce simpler regulations, removing any restrictive policies that stifle growth. Currently there are a number of challenges that still exist and limit the market s full potential (e.g. higher fuel taxes and fees, highly regulated environment, limited infrastructure development). Alliances continue to develop and shape the market: > > Etihad Airways acquired a minority share (24 per cent) in Jet Airways in late 2013, the first foreign carrier allowed to invest in an Indian carrier. This has the potential to improve Australia s link to India as Jet Airways looks to expand international routes. Focus areas for international growth include Europe, China, Australia and Southeast Asia. > > Air India joined Star Alliance in July Weekly services to Australia Operating Airlines Flights per week Route Air India 4à0 Delhi-Sydney-Melbourne* N/A 3à0 Delhi-Melbourne-Sydney* 0à4 Delhi-Sydney* 0à3 Delhi-Melbourne* Alliance/ code share partner (on route) *Air India plans to delink its daily Delhi Sydney/Melbourne services from 16 May 2015 and operate four weekly Delhi Sydney services and three weekly Delhi-Melbourne services. 3 INDIA Market Profile 2015

4 The Leisure Traveller India is Australia s 11th largest market for leisure visitor arrivals, ranking 14th with respect to visitor expenditure and is sixth for visitor nights. How does Australia perform? According to consumer research conducted by Tourism Australia, over one-third of Indian leisure travellers cite safety and security as their main motivation when selecting a travel destination. Other important factors for them include world class beauty, value for money and family friendliness. Australia performs strongly in terms of its safety and security, world class beauty and interesting attractions among Indian leisure travellers. There is room for improvement with respect to Australia s associations with value for money, romance and good food and wine. Australia s coastline, wildlife and island experiences generate the greatest appeal for Indian travellers in terms of attractions, with aquatic wildlife rating as the preferred Australian experience for just under half of Indian respondents. Motivations when selecting a travel destination A safe and secure destination 43% World class beauty and nature 32% Value for money 30% A family friendly destination 30% Good food and wine 29% Interesting attractions to visit 28% Romantic destination 26% Rich history and heritage 25% Friendly and open citizens 22% Ease of obtaining visa 20% Top Australian attractions Australian beaches 48% The Australian wildlife 45% Island experiences 41% Australian coastal lifestyle 37% The Great Barrier Reef 37% Australian food and wine 35% Rainforests/ forests 33% Travelling to many places 31% Unspoilt natural wilderness 30% The major Australian cities 30% Most preferred Australian experiences Aquatic Wildlife 46% Wildlife (non-aquatic) 45% City Experience 43% Shopping 42% Beach/Coastal/Harbour 42% Wilderness/Rainforest 42% Food and Wine 40% Outback/Indigenous 38% Niche: Diving, Golf etc 38% Aspiration versus visitation For aspiration and intention to visit, Australia ranks in 3rd position for the Indian traveller, just behind Mauritius and Switzerland. Australia also falls into the top five positions for awareness of experiences. When it comes to converting this into actual visitation, Australia falls to 9th place behind competitors such as the US, the UK and France. 3RD ASPIRATION 4TH AWARENESS 3RD INTENTION 9TH VISITATION These findings are based on consumer research conducted by Tourism Australia in 2014 in 11 of Australia s key tourism markets. Charts show the percentage of people in the survey who rank these attributes as important or appealing. 4 INDIA Market Profile 2015

5 The Indian travel distribution system is highly fragmented and varied across the country. Whilst there are a few national retail agencies, most agents are small, independent businesses and contribute a varying percentage of business to Australia. Anecdotally, 10 per cent of agents contribute 20 per cent of the business to Australia, and 90 per cent of agents contribute 80 per cent of business. Indian consumers are researching and booking their trips using a combination of traditional travel agencies and online options, however retail agencies still handle the majority of outbound travel from India. system Wholesalers/ Large Agents Commission Level: up to 20% The traditional wholesale model has not generally developed in the Indian travel industry. There are a few larger travel agents which have developed their own distribution network through smaller independent agents such as Thomas Cook, SOTC-Kuoni, Cox & Kings, MakeMyTrip, Yatra, TUI, etc. These are often referred to as franchisees or preferred sales agents. Some agents and OTAs have also adopted a model of homebased consultants that include housewives who prefer to work from home. The major operators having a pan- India presence are Thomas Cook, SOTC-Kuoni, Cox & Kings, Kesari, Club 7, MakeMyTrip, Yatra, JTB Travels, Vacations Exotica, TUI, Flight Shop, FCM Travel Solutions, Mercury Travel, etc. Most Indian travel companies operate across all segments of travel, including: group tours, Free Independent Travel (FIT), business events and luxury. There are a few traditional B2B wholesalers that are gaining support from the smaller retail agents, these include: Travel Boutique, Rez Live, Fore Travel Representations, GRN Connect and Amigo Travels. Legacy players in this space include Otilla International (formerly known as Saltours) and GTA. Retail Agents Commission Level: up to 15% The distribution of travel products in India is fragmented with only a few national operators. Most agencies are small, independent, familyowned businesses. Competition between the larger travel agencies is fierce, with aggressive marketing and tactical promotions in print media. Promotions include cash discounts, early bird discounts, hotel upgrades, free holidays to other countries/cities such as visits to Canada free on a USA holiday, holiday now, pay later schemes, cash back schemes and offers for a companion or child to travel for free. Most large retail agents brochure and market their own programs working closely with the inbound tour operators (ITOs). Large travel agencies take reservations from consumers through their own retail networks as well as from smaller agencies. Travel agents use Global Systems (GDS) such as Galileo, Amadeus, and GTA, to reduce response time and provide instant confirmations to clients. Despite the increase in the online travel segment, traditional retail agencies have not yet moved to this platform for bookings. Online Commission Level: up to 15% As the Indian outbound market grows, more consumers are using the internet to research and purchase their holidays. Online travel agencies (OTAs) now receive almost 50 per cent of all visits to travel sites, with the top four being Makemytrip.com, Yatra.com, Expedia and Cleartrip. Other international sites such as and are also very popular. There has been an increase in online bookings for air tickets for international flights with the improved reach and use of the internet, convenience of booking from home and the removal of credit card fees when booking directly with an OTA or the airline s website. Whilst the online purchase of holiday products is on the rise, most of the OTAs have now established agencies or call centres as an alternate distribution channel.»» Traditional and online distribution systems will therefore continue to co-exist over the next few years as the Indian outbound market grows and matures. 5 INDIA Market Profile 2015

6 Aussie Specialists The Aussie Specialist Program (ASP) is the primary platform for Tourism Australia to train and develop front line travel sellers to best sell Australia. As at 1 May 2015, there are 2,130 qualified Aussie Specialists in India and a further 2,225 agents are in training. 75 percent of these ASPs are based in the cities of Delhi, Mumbai, Bangalore, Chennai, Hyderabad, and Kolkata. New potential Aussie Specialist agents are identified in conjunction with airlines, ITOs and STOs. The Department of Immigration and Border Protection (DIBP) introduced a Preferred Agency Scheme (PAS) program for selected Aussie Specialist agencies, whereby approved ASP retail agencies are able to process visa applications according to the Department s requirements. As at March 2015, 87 agencies were involved in the scheme. The electronic lodgement (e676) service for visas is also available to nominated agents in India. Currently there are approximately 24 agents participating in this scheme. DIBP will be introducing the e600 pilot programme for agents on the Preferred Agency Scheme (PAS), which will enable e-lodgement of visa applications under sub class 600. Inbound Tour Operators Commission Level: up to 10-15% Several ITOs are active in India. The number of ITOs catering to the Indian market have doubled over the past two years. Key ITOs for India are Wel Travel, Travel Maestro, Holiday Pacific, Australian Outback Travel (AOT), Australian Tours Management (ATM), GTA, Tour East (Qantas Holidays), Safir Tours. Trends Online travel agencies such as MakeMyTrip.com, Yatra.com, Expedia and Ezeego1 have been increasing market share in the online space. They are expanding rapidly, and an emerging trend is their move into traditional retail stores, in addition to expanding products and services online. While there has been some growth in online sales of tour packages, the sales volume is still low to date for complete packages sales compared to traditional players and it is primarily for short haul destinations. Self-drive holidays, luxury holiday experiences and destinations such as South Australia (Adelaide and Kangaroo Island), Northern Territory (Ayers Rock), Western Australia (Perth and surrounds) and Tasmania are new products being developed in the market, with support from Aussie Specialist agents. Planning and purchasing travel Consumers are booking trips using a combination of traditional distribution operators and online options. Most consumers will book through a retail travel agent rather than directly with product. India is traditionally a late booking market and consumers have a short lead time for booking holidays, ranging from three to six weeks on an average, prior to the date of departure. Indians travellers prefer to plan itineraries prior to travel.»» The use of social media for researching travel is higher than some other markets suggesting it would leverage well amongst Indian consumers. 6 INDIA Market Profile 2015

7 Planning a visit to market Top tips for sales calls Sales calls should focus on agents in the key cities of Mumbai, New Delhi and Bangalore at least twice a year, and in the secondary cities of Kolkata, Chennai, Ahmedabad and Hyderabad at least once a year. The best time for sales calls is January to February and July to September. For more general information on sales calls and planning a visit to market, please see Tourism Australia s Planning for Inbound Success ebook at inboundsuccess. Key trade and consumer events in 2015 and 2016 Event Location Date India Travel Mission Bangalore Aug 2015 Australian Tourism Exchange (ATE) Gold Coast, Australia May 2016 (TBC) Where to find more information Tourism Australia s activities in India are managed from its Mumbai office. For more information visit Tourism Australia s corporate website at Australian State and Territory Tourism Organisations operating in India include: Destination NSW, the South Australian Tourism Commission, Tourism and Events Queensland, and Tourism Victoria. Also see: India Country Brief published by the Department of Foreign Affairs and Trade at: For the latest arrivals statistics, visit: For the latest International Visitor Survey statistics, visit: 7 INDIA Market Profile 2015