A Changing Package
Which would you prefer? The European Plan? The American Plan? Or what about the Modified American Plan?
In the seventies and early eighties, these would have been alien terms to the domestic tourist. Till then, any domestic vacationer who wanted a package tour of India mostly had to fend for himself or maybe opt for the age-old Kanyakumari-to-Kashmir Kundu Special. In the old days, this meant being crammed into buses and trains and staying overnight in cheap hostelries.
By 1990, things had changed. Says R M Puri, joint director general, department of tourism, The shift in the business is in terms of the target group which has changed from the overseas tourists to the domestic tourists. Today hotels in major tourist centres like Goa and Jammu offer upto 40 per cent discounts for domestic package tourists.
Much of the reason for this growing demand has been rising disposable incomes among upper and middle-budget travellers. Between 1980 and 1996, their disposable income for holidays increased by approximately 30 per cent annually.
For domestic travel agencies and the tourism industry, which depended heavily on inbound tourists, this has come as something of a boon especially as foreign tourist arrivals have started waning. Ever since domestic package tours were initiated in a big way five years ago, they has grown at a fast pace and to a great extent have supplemented inbound tourism, says Puri. For instance, Orient Express Travels and Tours, one of the oldest travel companies in India, has been handling overseas tourists for the past ten years. But from 1990, its package tour business picked up in the domestic market as well.
In India, like most other countries, tourism is seasonal. The high season for tourism starts in October and continues till March. Domestic package tours mostly fill in for the remaining six months the silly season when hotel occupancies drop sharply and discounts are handed out generously. For instance, Goa offers heavily-discounted package tours during the monsoons. Himachal Pradesh, Punjab and Haryana are being marketed as winter destinations a season when hotels in these states do not get much business.
Broadly, there are three types of packages on offer.The European Plan or EP provides only accommodation. The American Plan (AP) covers accommodation and three meals. The Modified American Plan includes accommodation, breakfast and one meal.
The packages provided by Indian Tourism Development Corporation (ITDC) give a fair idea of the kind of fare on offer. Their package deals were introduced in 1980 and the share of such packages is by far the largest. Unlike other hotel chains like Welcomgroup, who offers packages mainly during the summer months, ITDC offers packages throughout the year and especially during the festive season.
Their range for EP in their hotel chain, the Ashok group, is between Rs 1,500 and Rs 3,500 per night countrywide. For MAP the range is between Rs 2,000 and Rs 3,500 per night. And for AP the cost ranges from Rs 2,800 to Rs 4,000.
ITDC covers an entire range of tourist destinations which include Agra, Varanasi, Jaipur, Manali, Bhopal, Puri, Khajuraho, Aurangabad, Kovalam, Mamallapuram and Mysore. Most of its packages have been targeted at salary earners who are looking at ways of maximising their leave travel allowances.
From next year, ITDC plans to extend its package tour service. Says K Verma, deputy general manager, marketing and sales, ITDC, After our success in holiday packages we have decided to diversify to corporate packages.
Corporate package tours, in fact, are something many of the larger agencies are focusing on. American Express, for instance, offers their corporate card members destinations like Jammu-Taragarh-Dharamshala, Jodhpur-Jaisalmer, Gwalior, Goa and Darjeeling-Sikkim. These are offered at special rates which are offered to the card-members of American Express as an extension of their customer services.
In the past five years, corporate packages have grown at a faster rate than holiday packages. This is due to the fact that such packages as a whole have grown at a steadier pace in India. Over the last two years, corporate travel has increased by approximately 30 per cent compared with an overall, growth rate of between 10 per cent and 15 per cent for holiday travel.
According to a senior official in the department of tourism, Government of India, the reason for such an increase is the climate of liberalisation. He expects corporate travels to grow even further. Today, Indian Railways have introduced 12 packages tours under the name Rail Weekenders. These packages are mainly targeted at domestic tourists who are offered the facility of cheaper accommodation and touring with a round-ticket. These mostly cover such routes as Calcutta-Bodhgaya Delhi-Kanha and Madras-Trichi route.
What does the growth of domestic package tours mean for agencies in the long run? Perhaps more stable business. A spokesman for Mercury Travels, an agency that organises outbound package tours for such destinations as Europe and South Africa, says the business is fairly erratic. The volume of business Mercury has handled so far has not really reached any significant heights even though the expenses in such packages on an average are less than the normal tours by $40 per head. The main reason for this, says the Mercury spokesperson, is that the package tours are mainly targeted at groups while 60 per cent of the total outbound traffic comprises single travellers.