Ixigo to enter hotel segment in the next few months


Gurugram-based online travel agency (OTA) Ixigo plans to venture into the hotel bookings segment later this year. Currently, the company operates by redirecting all customers to booking.com for hotel accommodations.

Aloke Bajpai, co-founder of Ixigo, expressed his excitement about this strategic move, stating, “Entering the hotel segment is a natural progression for us as an OTA. While we have been partnering with booking.com for hotel accommodations, we believe it’s time to develop this segment on our own from a business economics perspective.”

Presently, Ixigo holds a modest 1 per cent share in the hotel segment, while MakeMyTrip dominates with 55.6 per cent, followed by yatra.com and Cleartrip with 3.6 per cent and 1.9 per cent respectively, according to a report by travel consultancy firm, Videc.

Massive user base

Bajpai further emphasised that the decision to venture into the hotel segment was driven by Ixigo’s ambition to establish a strong presence in the online travel industry and reduce reliance on external partners. “Our differentiator will be the customer experience, just like we have successfully delivered in the three verticals we operate in today. Despite the competition and the long journey ahead, our user base gives us an advantage, and we won’t need to overspend on acquiring customers like many initial hotel OTAs,” Bajpai explained with confidence.

Ixigo has built a massive user base over the years, handling over 60 million monthly active users and more than 6 million daily active users. Their growth velocity stands at an impressive 8-9 million downloads per month and 4-5 million transactions each month.

Bajpai emphasised that the company’s goal is to ensure unit economics work efficiently from the outset, utilising their existing user base to minimise the need for excessive customer acquisition spending.

“Our user base has been instrumental in driving our growth across different verticals, and we are confident that it will continue to support us as we enter the hotel segment. While the hotel segment may not be a significant chunk for us initially, we will have to handle it on our own instead of just partnering with booking.com,” Bajpai added.

Ixigo’s nimble-footed approach to spending has been instrumental in their success, particularly during the challenging times of Covid-19 . While most OTAs experienced a market bounce back of one to two times, Ixigo achieved a remarkable 6x growth, largely attributed to its customer-centric behaviour and strategic acquisitions of companies like AbhiBus and ConfirmTkt in the bus and train ticketing spaces.

Future plans

With its eye on the future, Ixigo is actively exploring potential revenue streams, including packages and tours. Recently, they joined forces with travel-tech start-up Pick Your Trail to bolster their packages section.

After establishing its presence in the hotel bookings segment, the company plans to venture into packages and experiences, while simultaneously accelerating its visa segment.

Furthermore, Ixigo had previously expressed intentions to launch its initial public offering (IPO) after receiving approval from SEBI for its Draft Red Herring Prospectus (DRHP). However, no date for the IPO launch has been announced yet, and Bajpai did not provide any updates on the matter.

Read original story on The Hindu Businessline.