Online Travel Agency clash with the traditional businessmen over aggressive discounts

There was a world where everything was sold and everything was bought without the internet. You got to see the product in your hand, you paid the seller and you got the product right then and right there. One used the most natural discount which was on offer and that had to be earned by bargaining. There were different shops for different things, no search bars only people to ask and boards to see.

Then came the internet, which radically changed the way we look at this simple system of buying and selling. There are hundreds of sellers under one roof now, thousands of discounts on millions of products all available at the tip of your fingers, all you need to do is have internet and money, of course. This introduction of e-commerce website has killed a lot of small-time shopkeepers.

This has caused a lot of ruckus among the traditional businesses of all kinds. There have already been strikes from the cab drivers of Ola and Uber. This was due to their grievances about driver commissions and prices per km. There has been another incident of such kind in India. Online Travel Agencies have landed themselves in trouble.

There has been a problem with one of the biggest agency around in that category. MakeMyTrip-Ibibo, the duo, which merged around two and a half years ago has found themselves in deep trouble. This is because of the ridiculous discounts that have been on offer on their websites and apps. Gurbaxish Singh Kohli, Vice President of Federation of Hotel and Restaurant Associations of India (FHRAI) said that the Online Travel Agencies (OTA) have been offering discounts even after the rates have been fixed with the hotels.

That means, if a room is priced at INR 10000 online after a discussion with the hotel then the OTA are discounting it further creating a problem for the traditional hotel owners. Online entities are offering far too many discounts and the hotel owners are struggling to keep up. There are customers who are asking to reduce the price by showing them online price companies are offering. However, this is a two-way street, someone has to meet the other one at some point.

Due to this, various associations are planning to go on a strike to put an end to this problem. That said, the FHRAI are going to discuss with MakeMyTrip and Ibibo before going on strike to avoid all the drama. A spokesperson assured that there will be a meeting and the issues at hand will be resolved. This is not the first time an OTA has landed in trouble, OYO rooms were also accused of the same but they came out unscathed.

This type of problems have occurred everywhere in online marketing. Traditional outfits are being overlooked and the sufferings have been hard on them. However, the winner in all this without a doubt are the customers. It will be interesting to see how this battle between the two sets of economies pans out.

– Unmesh Phule


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