MakeMyTrip plans to double down on alternative accommodation business

The firm's alternative accommodation business includes villas, apartments and hostels. It is now adding about 1,000 properties to that segment per month

MakeMyTrip, which has been doubling down on its alternative accommodation business for about three years now, says the segment is seeing booking at over 100 per cent of pre-pandemic levels, even as streaming services' production houses travelling for shoots to different cities are also contributing to corporate travel bookings.

MakeMyTrip's alternative accommodation business includes villas, apartments and hostels. It is now adding about 1,000 properties to that segment per month.

"Service apartments and hostels were 10-15 per cent of total room nights pre-pandemic. Now, villas and service apartments' contribution has increased. Hostels as a category are still lagging behind because that segment has not really opened up," said Rajesh Magow, co-founder and group chief executive officer at MakeMyTrip.

He said MakeMyTrip plans to add another 15,000 properties in alternative accommodation in the next 18 months.

Earlier, hostels were the preferred stay of choice for students, and even business travellers looking to spend a night or day in a location.

Given the work from home options across industries, and many contemplating a hybrid model of work, people have travelled for workations, leisure travel, or just a weekend getaway, and find these a more cost effective alternative.

"The overall cost per person will be relatively cheaper if you are a group of say 6 or 8 people sharing a 3BHK (bedroom, hall kitchen)," said Magow.

But it is also nuclear families that are looking to have a safe place to themselves, or a group of students or colleagues travelling together to work during the week and party over the weekend that are looking at alternative accommodation, he added.

In terms of change in people's travel booking patterns over the last year of the pandemic, Magow said the preference for bigger properties has increased. "The preference for premium or branded properties has increased for two reasons. One is that people feel they are generally clean and hygienically kept. The second is the price drop most premium properties were forced to put in place to increase occupancy," said Magow.

In terms of locations, places within 200-300 km of large cities like Delhi, Mumbai, Bengaluru, Hyderabad, Chennai, essentially within driving distance, where people can easily go with a driver along with an RT-PCR test, are popular.

In addition, people are venturing out of the more popular locations like Shimla, to more offbeat ones.

While corporate travel in small and medium business had already started picking up, large corporations are now mulling opening up work-related travel.

The rush to get new content on streaming services or over the top services like Netflix, hotstar, Amazon Prime, MX Player and others has also added to travel.

"Production houses working with OTT platforms have been doing round the clock work. All of them have become really popular, and they are doubling down on new content on the platforms. When these production houses go to a particular city, they need long stay room nights so that's also corporate travel for us," said Magow.

•  Alternative accommodation a focus area since 2019 for MMT

•  Includes villas, homestays, and hostels

•  Adding 1,000 properties per month

•  Plans to add 15,000 more properties in the segment in 18 months

•  Corporate travel picking up, OTT production houses also adding to the segment