EP #1: The Secret Recipe for 10X Travel App Growth at Ixigo.com

The Martechno Beat Episode 1 — The Secret Recipe for 10X Travel App Growth at Ixigo.com

Pradyut Hande (Host): “Right, Ladies and Gentlemen! Welcome to the very first edition of The Martechno   Beat. This is a specially curated podcast series powered by Smartech and I am so pleased to have none other than Mr. Himanshu Periwal for our very first episode of The Martechno Beat. Himanshu Periwal is the ex-head of growth at one of the leading online travel platforms in the country, Ixigo.com. So glad to have you on The Martechno Beat Himanshu!”

Himanshu Periwal: “Thank you Pradyut, likewise, really excited to be a part of this podcast.”

Pradyut Hande: “Wonderful, wonderful. So, we’ll be talking about how, you know, the application of Martech has revolutionized the travel industry and continues to do so. So without further ado let me jump into the podcast at large. So, my first question to you, you’ve been in the industry for a while now, what are some of the key digital and mobile marketing challenges for travel brands in India.”

Himanshu Periwal: “Sure, so travel as a category is itself a very tough category if you compare it to e-commerce, so travel is used one to two times a year right, as compared to e-commerce which is almost one to two times on a monthly basis. So, the biggest challenge is that you know the user who is actively participating, actively engaging with the travel app or travel website two to three times in a year, how do you further engage that user throughout the year so that you know if the user becomes a leapster or goes away. That is the biggest challenge. The second challenge is that the same products, be it flight-fare or a hotel room, are being sold by twenty big players in the market right now. Now, they are almost offering the same price point. Now, how do you build user loyalty without giving discounts you know, which is the easy way out. So, that is the second big challenge. And the third challenge is, you know so especially players who have been in the industry for a couple of years they start facing the scale challenge, so you know you…”

Pradyut Hande: “Right”

Himanshu Periwal: “ For instance, Ixigo has more than 150 million installs across our app so we have now started facing an issue where we are not able to scale as in such an optimum manner that we used to do it when the scale was smaller because the market is only this much right..so”

Pradyut Hande: “Right, correct”

Himanshu Periwal: “So the scale challenge starts hitting you once you have been in the industry for a couple of years.”

Pradyut Hande: “Absolutely, so the size of the market does not increase as much as the competition does. At the end of the day, you are competing for the same wallet share”

Himanshu Periwal: “Absolutely, that’s correct”

Pradyut Hande: “So, um we’ve spoken about what the challenges are. I would like to know how the application of Martech in the travel industry and in your experience has evolved over the last five years. And how have these trends, especially in emerging markets like India, how do they vary as compared to some of the more evolved markets?”

Himanshu Periwal: “So, I would say the entire pace of the market has completely changed over the last five years. If I remember, we used to send out, you know, one of bulk manual mailers five years back, and now one of those bulk manual mailers are fully automated user journey-driven personalized mailers. Not just mailers, like, through one platform we now send out emails, push notifications, SMSs, e-maps, even whatsapp. So, this entire industry as well as the tools through which users are able to power their * and marketing have evolved big-time. Another example to just fortify the effort or the change, we used to take almost three hours to send just one email to the entire user base, that was like four-five years back, and after sending that mail your work was almost done for the day, right. Now we have, at a given point of time or a daily basis more than a hundred emails being sent out automatically and all of those emails are personalized. Right, so you can just imagine what significant shift we have had not just for the marketers but also for the users because they are receiving so much more personalized information at the right time when they want it.“

Pradyut Hande: “Absolutely, so meaningful engagement at scale.”

Himanshu Periwal: “Yes, absolutely, and talking about trends in markets like India. So I would say there are a lot of interesting trends that we’ve been seeing and a lot of reports have been capturing these trends for the Indian market. So, one trend which is clearly, that clearly stands out that we in our lives have also seen is that leisure travel as a percentage of overall travel has increased in India and has been consistently increasing over the last four years. International travel is growing strong and solo and women travel is also growing big-time. The travel which earlier used to mostly be for specific purposes like business or going back to the family during vacations and all, now it has evolved more towards planning around adventures and you know visiting popular landmarks, etc. Right, and lastly I would say that the big trend that we have seen in India as against the West is that the key travel that you take in a year, which is like you know one or travels that a person takes. That holiday is on an average for five to six days in India as against in the west that holiday is usually for a period of about two weeks.

Pradyut Hande: “Right”

Himanshu Periwal: “So about 15 days. So, you know that trend is still, you know, India is still to catch-up on that trend, but evolving yeah.”

Pradyut Hande: “Right, so essentially speaking, you know different travel segments continue to expand and I think one major reason for that would have to be the fact that the average disposable income being spent on travel today has gone up many folds, say about five to six years ago. In fact, India currently spends an average disposable income of about 11% on travel itself, which is far higher than some of the more developed economies.”

Himanshu Periwal: “Yeah, absolutely, which is essentially plugging back into, you know, an increase in all of these kinds of travels.”

 Pradyut Hande: “Absolutely, so Himanshu, from a marketer’s point of view what does the conversion funnel or the buyer journey in the travel industry look like?”

 Himanshu Periwal: “Uh, so in the travel industry if you look at a user funnel we can break it down into five major buckets. The first bucket being acquisition. The second, being activation. The third, being retention. Then referral, and then revenue. Right, talking individually about these buckets. In the acquisition bucket, it is when you know how you acquire that user. Like, be it, the user’s first app launch or first website visit on your travel app or website. The second bucket is registration or flight search, that is the activation bucket. So as soon as a user does a registration or a user does a particular search for a hotel or a flight or a bus, whatever. So, as soon as that event is done we understand that the user has activated himself or herself on our app. The third bucket is retention, so let’s say the user came for the first time, activated, and now it’s important to track when the user comes back to the app. Because there is a period of, in some cases it could be twenty days and in some cases, it could be forty-five, sixty days. If the user doesn’t come back in that particular sixty days then you can consider the user to have churned out. So, then you start capturing this * take pretension and understanding when the user is coming back and that’s also around which you start planning your engagement campaigns because you don’t want your users to churn out. Right, so the fourth bucket is of referral which is, suppose users experienced a good product or a good user flow through our app, thus referring your product or advocating for your product to some of their friends, they start sharing things about your app or from your app, you know especially like if you * us you will see a significant percentage of our users we have acquired through the links that users share from within the app. It’s major information and user internet **** important bucket in the travel industry.

Pradyut Hande: “Right, right.”

Himanshu Periwal: “The last bucket being important is the revenue bucket. It’s obvious you know the transactions you’re driving but most importantly how well you are able to upscale and process and monetize more, you know there is a term called ARPU (Average Revenue Per User). So how well are you able to increase that for your travel app or website, so that consists of the revenue bucket.”

Pradyut Hande: “Right, so essentially it becomes so critical to monitor the movement of your customers across the entire funnel to make sure that you have complete visibility on the kind of revenue you eventually make.”

Himanshu Periwal: “Yes, absolutely. You know, because the entire funnel is any part or any bucket of this funnel is leaky then you know all of that will flow down to the revenue bucket. The revenue will take a big bullet.”

Pradyut Hande: “Right, absolutely, that makes a lot of sense. So, just building on my previous questions. If you could share with our listeners some of the key metrics that you would want to track at every stage of the conversion funnel. What would those be?”

Himanshu Periwal: “Sure, let’s take that funnel again, right so in the acquisition funnel which is you know when you’re acquiring users. So, if you are acquiring users from performance marketing or paid marketing then you start tracking a cost per order as a metric. Right, a cost per booking, be it flight booking or hotel booking and you track it across different verticals.”

 Pradyut Hande: “Right”

 Himanshu Periwal: “And overall in a blended manner you track like your cap for the overall user which would also include the discounts that you give the cost of profiling through co-marketing or organic marketing, you blend all of that and divide by the total number of users that you acquire and you get a cap. And the second bucket is activation, where you are tracking say if you’re tracking registrations then the metric would be apps launched to registration ratio. That is, you know if a hundred users are launching your app out of that if only fifty percent or fifty people are registering then you get to improve that and make it like seventy percent so that you can reach out to more users. Till a user registers it’s very very tough for you to reach out to that user right. It’s like a push notification and all in the app is like the only channel right, so to be able to reach out to those users and communicate with them more you need to ensure that itself is the metric to track. The third metric is retention, so for retention you track like a d30 app installed retention which you can find out from play store, right Playstore gives it for all apps. If it’s a website then you can talk about travel, usually people take seven to fifteen days from the first flight search or the hotel search to make their booking.”       

Pradyut Hande: “Would that be specific to India as a market or is that the generic industry trend across geographies?”

Himanshu Periwal: “Oh, so that used to be a general industry trend, in fact for India the time period is shrinking as we speak so five years back it used to be much more now people are planning their travel very close to their departure date, so hence because it’s the last moment travel this time period is also shrinking, so overall I would say in India that’s shrinking, you know, at a much faster pace.”

Pradyut Hande: “Makes sense”

Himanshu Periwal: “So you know you track like you know ** open rates or revisit rates for retention. So, moving onto referral you track like what is the percentage of referral installs or referral users you are getting as against the total users that you get, so that would essentially be the most important bucket for referral and lastly for revenue you track the total revenue, the total transactions and average order value revenue from upselling and cross-selling. So, there are multiple metrics to track on the revenue bucket, while you’re tracking all of that it’s important that you track it across various platforms, like your website, app, android, iOs, mobile website etc. You also track it across various verticals you know different for flights, different for hotels. So yeah you need to have various cuts across all of these buckets and that’s how you do it. 

Pradyut Hande: “Incredible, incredible insights Himanshu. So, now that we’ve seen what the customer journey looks like, what the conversion funnel looks like I think it’s also important for me to ask you at this juncture, based on your experience in the industry, what are the most effective channels of user engagement?”

Himanshu Periwal: “Talking about organic or remarketing, the most effective channel still now for us has been WhatsApp and email. These are the channels where we receive the maximum CTRs or maximum open rate.

Pradyut Hande: “Which is surprising given the fact that email has been such an age-old traditional channel of engagement on the other hand WhatsApp has just rapidly emerged as a really powerful tool of engagement.”

Himanshu Periwal: “Yeah, yeah, absolutely I understand. So, the reason why e-mail has not been able to work for most of the people is that most people send out not personalized mails whereas for us we only send out very very personalized emails. We’ve almost stopped sending, you know apart from specific user cases which is very very rare, we don’t send out bulk mailers at all. So that is the reason why the open rate for emails still stands much taller than social in-app for us but WhatsApp is far better than any other channel we have ever seen, like it’s almost three to four times highest performing channel in terms of open rate.”       

Pradyut Hande: “Because you’re essentially reaching your customers on a channel of their preference.”

Himanshu Periwal: “Yes, that’s the thing because it’s also not as cluttered as other channels have become now. Firstly, WhatsApp doesn’t allow you to send out promotional communications.”

Pradyut Hande: “Correct”

Himanshu Periwal: “Here we only send out very transactional related communications”

Pradyut Hande: “Correct”

Himanshu Periwal: “So, that is there. And apart from that, there are channels like push and in-app and ** which are free. You know you don’t pay anything for sending communication through these channels, that’s why they are effective because  you know the ROI’s always high but at the same time you have to be very very cautious of user fatigue. Because we have observed a lot of brands like ***user uninstalled, user churned because too much communication is being pushed out through these channels.  

Pradyut Hande: “Right”

Himanshu Periwal: “So, while they are free you have to be over-cautious with these channels at the same time.”

Pradyut Hande: “Absolutely, because it’s such a massive temptation for marketers to use free channels such as push notifications and in-app messages but at the end of the day everyone needs to be mindful of the fact that you don’t want to create brand dissonance in the hope of generating further conversions.”

Himanshu Periwal: “Absolutely, yeah”

Pradyut Hande: “Right, so we’ve spoken about customer engagement uh I’m just like to pick your brain on what would be some of the key user retention hacks that have worked for you in the past.”

 Himanshu Periwal: “So, in the travel domain the biggest hack is your product. If you’re able to build good product features then engage and retain users and make you the preferred travel brand over all the other travel brands, like you know we talked about, right. Everybody is offering the same commodity almost at the same price.”

 Pradyut Hande: “Correct.”

Himanshu Periwal: “So in such a market scenario your product features become that driving factor which will help you retain your users. So, if you know we have a product feature of PNR prediction on trains and a flight fare prediction on our flight app, which actually have become one of the most important features that help retain users. Because users come back on the app not just for transactions but they come back to keep checking these insights or the information that these features provide.”

 Pradyut Hande: “Right”

Himanshu Periwal: “So, as you know, the majority of the traffic on the train app is coming to seek information not just make a transaction so first features become the biggest hack I would say. The second hack is doing analysis and a lot of analytics on your user focus, so for instance you do * frequency analysis and find out the time when your 50th percentile of users will start uninstalling your app right so then you start sending your engagement campaigns to avoid that because you know if you’re able to predict after the 17th day of the app install if the user does not come back to your app 50th percentile users will start churning out by then. You start sending out campaigns during that journey to minimize that. That hack has worked out well for us. Lastly, you know slightly, I would say, a commercial hack is most of your apps will have wallets so you make sure that you keep some money in that user wallet in that product. So, for instance, for Ixigo we had Ixigo money so we used to always make sure that our users had 50 or 100 Ixigo money so that they don’t have the intent to install the app because users don’t like to, especially in India they are very very money conscious, they would want to retain the app for the Ixigo money balance that they have.”

Pradyut Hande: “That makes a lot of sense actually, one point that you mentioned that really stood out was that fact that you need to build value-driven product stickiness. You know, regardless of what your app looks like you can’t really resort to gimmicks all the time to drive engagement and retention, it genuinely comes down to how good your platform is.”

Himanshu Periwal: “yeah”

Pradyut Hande: “Alright on that note, I would, you know you’ve shared incredible insights. I would also like you to leave our listeners with a little bit of advice on how to go about evolving, existing and succeeding in this market that has now become so data-driven especially in the marketing fraternity.”

Himanshu Periwal: “So I would say that if you are data-driven then 50% of the problem is solved because the first hurdle is to actually become data-driven in your approach. Right so as soon as you start measuring and start approaching all problems with data in your mind you would have crossed half the hurdles and at the same time you also need to ensure that you’re capturing all the correct information and all the required data. Like, for instance, you’ll be passing a lot of events in your ** Now these events can have multiple properties like a flight search event can have the name of the flight, airline, national, domestic flight you know what kind of flight ticket it is, tax, you know there could be end number of properties that you can pass. You need to make sure you’re passing all the relevant properties which will help you to have analytics on top of it. So capturing all the data and doing analytics on top of it is the way to go on about it and the other advice would be you know, you need to keep experimenting, like you know if you’re a part of growth or marketing you need to ensure that you, first is the experimenting and through those experiments, you should try to find out new innovations which will help solve users problems In a better manner than your competitors because like the moment you stop innovating a new startup or an existing incumbent player will come up and you know take up from that place because you’ve been stagnant for a long while you know. Innovation in this domain will fly high and take the users away. That’s what we’ve seen happen in the past and that’s like a constant loop so it’s important that you keep experimenting and keep innovating.“

Pradyut Hande: “That makes a lot of sense, so data-driven innovation is really the way forward. Alright, Himanshu thank you for being a part of the first edition of the Martechno Beat. It’s been a pleasure hosting you. You shared some incredible insights that I‘m sure our listeners are gonna benefit from greatly.”      

Himanshu: “Absolutely, thanks a lot Pradyut for having me as a part of this podcast, and I really hope these insights will help our listeners.”   

Pradyut Hande: “Alright, thank you so much.”  

Himanshu: “ Alright, thank you, bye.”