Thomas Cook India’s survey suggests that 80% of customers want to travel in this calendar year: Mahesh Iyer, ED & CEO

Mahesh Iyer, Executive Director & Chief Executive Officer, Thomas Cook (India) talks about Finance Minister’s announcement and its benefits for the tourism industry, Demand scenario and outlook for FY22 among others during an exclusive interview with Zee Business. Edited Excerpts:

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Q: The Finance Ministry has made several announcements and the tourism industry was specifically mentioned in it. What is your view on it and how it will develop the sector or you feel that something more was needed for the sector?

A:  The announcements made by the Finance Minister has some good positives, like five lakh visas have been made free – the scheme will be applicable till March 2022 or till five lakh visas are issued whichever is earlier. I think it is a large number and with the free visa, I expect that it will support people a lot. It makes India an attractive destination because not only the visa cost but the Hassles of getting a visa also put off people from accessing. So, I think, it is a good decision. Secondly, the Rs 10 lakh support that travel agents are being provided, in which a 100% guarantee is being provided from the government’s side, is a very welcome step. It will help the small and medium enterprises, especially in the travel segment which has been very badly hit. They will be relieved because of this. The third step of Rs 1 lakh support provided to the tour guides is very important because there are many registered guides, who do not have any livelihood from the last 12 to 14 months and I think it is a very welcome step for those. The other big announcement made by the Finance Minister in which the allocation of Rs 3.50 lakh crore provided under the Emergency Credit Line Guarantee Scheme (ECLGS) has been increased to Rs 4.50 lakh crore with a view that the sectors impacted the most like hospitality, tourism and health sector - where people took an advantage of the facility - has been broadened. You would have seen that under ECLGS around Rs 2 lakh crores have been disbursed. So, when the corpus is increased to Rs 4.50 lakh crore then I think it is another welcome step.

As you asked can something else can be done, yes as you know the sector has been hit badly, so some tax relaxations should be provided so it will be good because this is a sector or area where people were worst impacted. So, if some relaxations are provided on the front at things like power consumption and the surcharge that is slapped on the fuel. If it happens then the prices will turn affordable and more and more people can take from it.

Q: The process of unlocking has started and many states have opened up. What kind of demand and bookings are available? Also, in the on-ground situation, do you feel that a strong demand or people have started revenge travel, if yes, is it translating in a good way for the company? What kind of response you are getting across the country?

A: For this, I would like to take two steps back and inform you that about four weeks ago, we did a consumer survey where we took feedback from close to 2,000 respondents. From that feedback, we came to know that almost 80% of the people were very keen to travel in 2021, itself, which is a huge number. When it comes to respondents then they are people who have travelled through us earlier or generally have made enquiries with us. After asking these people, we came to know that they have a strong desire to travel and 80% have positively said that they want to travel this year itself. Of this 80%, around 65% wanted to travel in September itself or before it and the rest of the 15-20% wanted to travel in the last quarter of the calendar year. So, intent to travel is clearly visible and I will not term it as revenge travel because people always have this intent to travel, everyone is a wanderer and travel become a necessity, it is not a luxury or comfort, it is a necessity and people will definitely travel. So, what is already ingrained in our business model that travel will happen, I think, it is emerging. The second most important element we have seen is that there was a lot of curiosity among the people about safety, how it will remain, what it will be. Also, there was a lot of curiosity about the RT-PCR rules and vaccinated rules of various states amid the lockdowns there. The third thing that we saw in that feedback was that more than 55% of people had a preference for domestic travel and a strong 45% of the respondents wanted to undertake international travel in 2021 in the last quarter or maybe early 2022. So, amid these numbers, we are getting a strong indication that people are curious to travel and it will continue. Responding to it, our company has done two things:  

(i) It has launched a concept named TravShield, which is a 360-degree view for the customers from the safety point. In this, we have taken care of three things and one of them is personal safety. When we talk about personal safety then the first thing is that 76% of the staff of the company has already been vaccinated with either one and in some cases up to two doses. Whatever locations we have, all our associates are 100% vaccinated. So, those who will deal with the customers at our stores are completely vaccinated, so the customers will feel safe walking into our branches and interact with them to complete their holiday requirements.

(ii) Similarly, when they will travel, we will ensure that the co-passengers who are travelling with them are fully vaccinated or will carry a COVID negative certificate.

So, these two assurances will be provided to every customer during the tour. So they will feel to be in safe zone.

(iii) We will also ensure that all the players of our entire ecosystem, be it be airline, hotel and transport that we use are fully vaccinated.

So, we are creating a complete Shield around the customer and will take care of their personal safety completely.

The other thing that we will cover in TravShield is financial safety. This financial safety is an important chapter now because the customer has a feeling that if I have booked it today and there is a new condition of lockdown are there then what we will do, our money will be stuck, we have made deposits, so will we get it or not. So, we have launched a concept called, Travel Now and Pay Later, in which the customers will have to pay a small token amount to book the holiday and the rest of the amount can be paid in 15 days after return. This is the conjunction with the financing partner with whom we have worked out. This is a very exciting concept for the market. It does two things they are it provides confidence to the customers that currently we are not blocking your money and if you are not able to travel due to any reason then the loan you have taken should not be paid. So, complete coverage is provided.

The third thing that we have covered in this shield is mental safety. In this, we ensure that every traveller is provided complete insurance coverage, which covers COVID and there is a certain cap on certain coverages but we provide COVID insurance to every traveller. More importantly, a doctor on call facility is available for which we have tied up with the Apollo Group of Hospitals. Under it, if any customer has a need due to any reason then a doctor on call assistance is provided, who will help him.

In addition to it, we have a guest manager with every tour, termed as Tour Managers, who will be them all the time. They will provide all the ground support that is needed.

So, through these two concepts, TravShield and Travel Now and Pay Later, we have seen that customers are quite excited and our booking friend is already reflecting. As you know that lockdown has been removed in some phases like lockdown have been withdrawn first in Mumbai, Maharashtra and Delhi, where the campaign has been launched. And, in its response, we have received enquiries of up to 80% of the pre-pandemic levels, which are showing a good trend and proves that customers are willing to travel.

Q: How are you expecting this whole year to be like the first half of the calendar year has passed or a quarter of the financial year? Still, some uncertainty is present, so, realistically, what performance you are seeing in the worst-case scenario and decent scenario because the domestic travel or inbound travel is picking up a bit?

A: I will not be able to make a forward-looking statement but would like to give you an idea of how we’re looking. Obviously, FY22 is definitely going to be better than the FY21 and one reason for it is that when we were in the first stage of the lockdown, no one was aware of the vaccination and as per yesterday’s statistics almost 32 crore people have been vaccinated and out of this 32 crore, the population that travels with us a large part of that belong to this 32 crore people who have been vaccinated. So, it is giving confidence to us. The people who are being vaccinated have an intent to travel. They are either corporate travellers or leisure travellers or holiday seekers and visiting friends and relatives. So, clearly, the confidence that should be there in a segment is there due to the vaccination. So, the confidence that was not available in FY21 is available in FY22. In FY21, when the wave struck we were not prepared, i.e. it was the first such event that was a black swan event and no one has any preparation for it. But we are prepared well for FY22, like if you will have a look at our company then the cost measures that we were supposed to take have been taken, the technology interventions that were required, where we were supposed to reach out with the customers and provide a touchless, contactless and digital solutions, which should be provided holiday business, it has been enabled completely. Today, if we are not in the office then also our staffs can provide seamless services to our customers and fulfil their requirements. So, the things that have been enabled take us a step ahead. Obviously, FY22 is not going to be as good an FY19 but surely it will be better than FY21. As far as inbound travel is concerned, yes the announcements made by the Finance Minister where 5 lakh visas will be issued, I think this is a positive step and I feel due to these factors India will become an attractive destination, of course, borders should be opened, aircraft and commercial arrangements should be opened and as soon as the market will start opening up like we have heard an announcement that Switzerland has already opened its border for India, Dubai has already announced to open the borders for India, there were requirements in the Maldives. So, the international borders have slowly and steadily started to open up and as our vaccination policy is made a bit clear, i.e. those stuck for approvals, think the confidence to travel will come back. I think that FY22 will be much better than FY21.