The travel business in India is exploited by many companies and the market has become quite crowded with too many sellers than buyers. The fact that the Indian public has made their peace with some companies for some services, is hurting the companies more than it is benefitting the consumers in India. For example, there is Goibibo, a company very similar to MakeMyTrip but Goibibo is mostly used to book hotel rooms and MakeMyTrip is mostly used to book flights and buses.
There are a bunch of companies offering similar services and some offer discounts in some categories while the other in different categories. That is the reason the consumers are scattered across all platforms which are hurting the companies. That being said, MakeMyTrip is not as good as it wants to be. It is facing a lot of problems and those problems are on the consumer end.
There are problems such as bus tickets not being available when they actually are, the coupons listed cannot be used or there are not enough options to choose from. MakeMyTrip offers good deals sometimes, with ‘sometimes’ being the keyword. Some of the users are afraid to use the platform because there have been instances where money was deducted but the ticket was never booked. The money was refunded but the time which is very crucial in making travel arrangements is wasted.
MakeMyTrip has deep pockets but the cash burning is not happening at the right place. Not only this, there were some scandals that took place during this time last year when a certain WhatsApp message went viral which said that MakeMyTrip and other such apps had been banned. This sent people with bookings and prior agreements into a frenzy. This might not be MakeMyTrip’s mistake but the clearing of air did not take place sooner and many ended up canceling their tickets and berating the company.
However, good times might be coming to the company after all. It has shaken off a lot of dirt and is trying to focus on certain markets in India. Naspers, which had heavily invested in the company has given up its stake for 5% stake in Ctrip. Now the deal is a bit complex as Naspers gave away most of the 42.5% stake in MakeMyTrip to Ctrip for around 5% stake in the latter.
Ctrip is a Chinese travel company and is one of the biggest in the market. It now owns around 49% of MakeMyTrip shares which is almost half. Previously, Ctrip held around 10% stake and after the deal with Naspers, the company has come to hold around 49% of MakeMyTrip which is a deal that is a win on both sides.
That being said, Ctrip brings a lot of things to the table with its experience in the travel biz. Apart from this, it has gone through the phase of business MakeMyTrip is in and has emerged victorious. It will be interesting to see if there are enough funds made available by the Chinese company so that its Indian counterpart can come out of this crowded mess in the travel business in India.