e-ticketing everywhere

It’s everywhere and everyone’s doing it. Be it flying, traveling by train or going to a movie—e-ticketing is becoming the preferred mechanism. By Mohd Shariff PA

For the record we thought that it would be interesting to rattle off some statistics that speak volumes about the growth of e-ticketing in transportation.

The online passenger reservation site of Indian Railway Catering and Tourism Corporation Ltd’s (IRCTC) sales from the Internet booking of train tickets in a single month (August 2007) totted up to a staggering 12,90,608 tickets generating revenues of Rs 110 crores. Direct online ticketing now accounts for 40 percent of the tickets sold at most airlines. Air Deccan does an average of Rs 30 million worth of transactions per day.

These are exciting times for Indian e-ticketing. Sales are robust and large corporations and enterprises are pulling out all the stops in their attempts to grow online sales. Online ticketing has caught on with high acceptance in the Indian market. There are many vendors who are trying to capture this space and large corporations are firmly behind online ticketing.

IRCTC’s record online sales

IRCTC, which has been entrusted with the responsibility of providing booking services through the Internet and other modes, created history recently. Vinod Asthana, Director, Customer Service, IRCTC said, “In the month of August 2007 we booked a total of 12,90,608 passenger e-tickets, generating a revenue of nearly Rs 110 crore.” He added on an average, 43,020 people book tickets online every day with IRCTC generating an income of Rs 3.6 crores daily in August. Asthana added, “We have observed that 15 percent of ticket sales are through e-ticketing and we plan to double this number by end 2008.” He believes that this is just a “small beginning” and that there’s a lot of potential in the concept that has yet to be tapped and that IRCTC has a solid strategy behind it that will enable it to tap this potential.

We believe that the online booking of train tickets is taking giant strides in the country. Each month more and more passengers are booking their tickets through the Internet indicating that the popularity of online reservations is still in the growth phase.

Initially e-ticketing took some getting used to as it was carried out through credit card payment only. Looking at the constraint of limited Internet access, IRCTC is unloading a bouquet of services that will help ordinary citizens to book railway e-tickets easily. It recently tied up with Sify to make online railway ticketing services available at over 3,400 iWay cyber cafés across 154 cities on cash payments. As the first step, in a pilot project, 10 iWays stations in Delhi have been involved in e-ticketing. With this alliance, users can approach a Sify iWay where the cafe administrator books the railway e-ticket online based on particulars provided by the customer such as date of travel and destination. The customer then pays cash against the ticket and collects the printout. In case of ticket cancellations, customers have to follow standard cancellation procedures after which they get a cash refund.

In addition to its tie-up with IRCTC, Sify has acquired US-based Globe Travels, which issues e-tickets for the India-US sector.

Asthana added, “IRCTC’s major income [online e-tickets] comes from bookings generated through credit cards—in the last two months [August and September 2007] 6.3 lakh e-tickets worth Rs 56.63 crores were booked using credit cards while 3.76 lakhs e-tickets worth Rs 28.5 crores were booked through debit cards and Net banking. Some came through cash cards at petrol pumps. IRCTC is targeting one lakh e-tickets sales by March 2008. Banks are coming forward to sell e-tickets through credit and debit cards. Most service providers are trying to make it easy as possible for travelers. Down the line it is the comfort and access to technology that is driving people to use the Internet to book e-tickets. With online access, one can book from the comfort of the office or at home.

To encourage people to avail of this facility, IRCTC has reduced the e-ticket service charges from July 2007, where IRCTC brought down the minimum charge for the sleeper class to Rs 10 from the earlier Rs 15. The convenience of e-ticketing will come at a price. Users opting to book e-tickets with cash have to shell out a transaction charge of Rs 15 in case of a sleeper class ticket and Rs 25 in case of an AC ticket and we think that passengers will not mind shelling out a few bucks for the convenience afforded to them.

Moreover, IRCTC—the country’s largest e-ticketing network has appointed around 8,000 agents for booking e-tickets including its authorized agents, members of IATA, BPCL and state governments. Additionally IRCTC is tapping new channels by allowing the public to book e-tickets through ATMs at 1,200 locations.

Airline e-ticketing sales

Air Deccan and India Post (Indian postal department) have come together and enabled 500 Internet-enabled post offices in Karnataka to offer e-tickets. Air Deccan has also tied up with BPCL for selling e-tickets at 35 locations in tier 1 & 2 cities. According to a source in Air Deccan who refused to be quoted, “As per IATA estimates 80 percent of all ticket bookings in India are done electronically. The phenomenon is well on its way to achieving the 100 percent mark by next year.” In the same vein, Jet Airways also accepts the fact that most of its air passengers are Internet-savvy and prefer to book tickets online. Guarang Shetty, Vice President- Marketing, Jet Airways said, “We were the first to provide hundred percent online e-tickets and even connecting flights can be booked online. 100 percent of the tickets are booked online (e-tickets) and we have done away with the paper-based ticketing system.”

Air Deccan launched its operations with a 100 percent online e-ticketing service and in no time became a popular e-commerce site, executing Rs 30 million worth transactions per day. Officials at Air Deccan said that, “We are in the software capital of Asia and were looking outside the country for a package that will make online booking and tracking simple for passengers. I put a team together and within a couple of weeks they were ready with the software.” The e-ticketing interface of the company’s Web site is user friendly and allows passengers to plan their itineraries without the hassle of stepping out.

Direct online ticketing now accounts for 40 percent of tickets sold at most airlines. The arrival of the Internet booking engine marked the beginning of the online fares revolution.

Travel buffs take the e-ticketing route

The dynamic fares of airlines and railways are advantageous to passengers and have boosted the popularity of air travel, so much so that the Indian Railways has been forced to upgrade its services on highly traveled routes in order to remain competitive with initiatives like the Garib Rath. Travelers can avoid long queues and save on the service charges payable to travel agents. The Internet has helped drive down the cost of operation of an airline as it can operate with leaner staff and the cost of distribution falls. All these factors have been significant in bringing down fares and directly responsible in many ways for the emergence of low-cost, no-frills airlines such as Air Deccan and SpiceJet.

Sachin Bhatia, CMO & Co-Founder, MakeMyTrip.com said, “With IATA setting a deadline of 2008 to introduce e-ticketing across the globe, the ubiquity of e-tickets and their universal acceptance is just a matter of time. We expect that 75 percent of airline tickets in next two years will be booked online. Of the 5,000 bookings that we do per day, 4,000 are e-tickets.”

Air Deccan’s spokesperson referred to a study conducted by The Emerging Online Travel Marketplace in India, according to which e-ticketing (airlines) is expect to account for 71 percent of the market in 2008 generating a revenue of $1.4 billion in sales. Rail bookings come in a distant second and will grow at 30 percent over the next two years.

If the latest industry figures on Indian e-ticketing penetration are to be compared with those of other Asia-Pacific countries, we are pretty much in sync. Better still is the fact that the growth of e-ticketing during 2006 has been perhaps the highest in the world. Industry players told Express Computer that they have been tracking growth on a monthly basis; e-ticket penetration grew from a measly 10 percent in 2005 to 65 percent in 2006.

Bhatia explained, “The online travel market in India is expected to be the most dynamic in the APAC, and experience strong growth over the next five years. About 95 percent of Web-initiated travel transactions are expected to be fulfilled online (e-ticketing) in India as the market develops.” An evident fact is that the online travel industry is attracting new players while existing ones are ramping up their operations to cope with demand. Stiff competition is expected. Some industry players, however, see it differently. Bhatia expects the domestic travel industry to keep growing at 25 percent per annum citing the fact that almost 400 million people went on a domestic holiday in 2005. He feels that there is plenty of scope for everyone in the travel business to grow, whether it is offline or online.

Although India has poor Internet penetration, e-ticketing has made a strong start. With more channels springing up, e-ticketing is poised to engulf the nation. Even in small towns, you can book e-tickets by paying a small commission to agents. Which only goes show that online booking has taken off and is ready to soar up, up and away.

mohammed.shariff@expressindia.com