Forecast of the market of excursion services in India
The relevance of research
The basis of the excursion show is excursion objects, including memorial places, buildings and structures, monuments of history, architecture, art and archeology, natural objects (reserves, wildlife sanctuaries, relic plants, etc.), industrial and other enterprises, expositions of museums, art galleries, exhibitions which are shown to tourists during the tour. In India, excursion services to the population and guests of the regions are provided by both travel agencies and independent guides, and guides with appropriate qualifications.
Purpose of the study
Analysis of the state of the excursion services market, assessment of the market volume, analysis of competitors, as well as identification of factors affecting the excursion services market
Content
Chapter 1. Key components of the excursion services market
1.1. Market size
1.2. Growth rates of the excursion services market
1.3. Excursion services market trends
1.4. The main problems of the industry
1.5. Stage of the life cycle of the excursion services market
1.6. Estimation of the number of buyers and their financial capabilities
1.7. Estimated consumption per capita
1.8. Analysis of sectoral indicators of financial and economic activity
1.9. Price analysis
Chapter 2
2.1. Economic components
2.2. Social Components
2.3. Technological components
2.4. Political Components
2.5. STEP-analysis of the excursion services market
Chapter 3. Assessment of the degree of competition
3.1. Scale of competition (local, regional, national, global)
3.2. Number of competitors and relative market shares of the largest competitors
3.3. Compact location of industry companies in certain regions
Chapter 4 Industry Forecasts
4.1. Analysis of the impact of recent crises on the industry (the global crisis of 2008 and the currency crisis in India in 2014)
4.2. Analysis of the impact on the state aid industry at the current date
4.3. Assessment of the degree of impact of the crisis due to covid-19 on the analyzed market. Barriers existing in the market of excursion services
4.4. Prospects and growth drivers for the excursion services market
4.5. Forecast for the development of the excursion services market in the context of the current economic crisis due to covid-19
Chapter 5 Forecasting Methodology
5.1. Methods for forecasting key industry indicators
5.2. Sources of information for forecasting
5.3. Timing of forecasting
Research excerpt
Chapter 1. Key components of the excursion services market
1.1. Market size
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Diagram 1. Market structure by methods of organizing excursion services
In India, excursion services to the population and guests of the regions are provided by both travel agencies and independent guides and guides with appropriate qualifications. It is conditionally possible to divide the market into segments according to the methods of organizing excursions or through acquisition channels - through travel agencies or from independent guides and guides. Those who wish to visit this or that excursion can contact the travel agency that organized the tour for them, purchase excursion programs along with the tour, or, upon arrival at the place of rest, independently select the excursion programs of interest through a representative of the travel agency. In addition, both tourists and local residents can purchase excursion services directly from tour guides or guides.
According to the definition of GOST R 54604-2011, excursion services are tourist services for the development, organization and conduct of excursions. Excursion - a service for organizing visits to the objects of the excursion display (objects of natural, historical and cultural heritage, industrial enterprises, etc.) by individual tourists (tourists) or tourist groups, which consists in familiarizing and studying these objects, accompanied by a guide, guide, guide-interpreter, lasting less than 24 hours without an overnight stay. A tour guide (guide) is a professionally trained person who carries out activities to familiarize sightseers (tourists) with objects of a tour display in the country (place) of temporary residence.
The basis of the excursion show is excursion objects, including memorial places, buildings and structures, monuments of history, architecture, art and archeology, natural objects (reserves, wildlife sanctuaries, relic plants, etc.), industrial and other enterprises, expositions of museums, art galleries, exhibitions which are shown to tourists during the tour.
Excursion services are the activities of the states of the tourism industry (tour operators, travel agencies, tourist and excursion, excursion organizations), as well as individuals (tour guides, guide-interpreters) who have the necessary qualifications to develop, organize and conduct excursions. Excursion services can be provided separately or be an integral part of the tourist product, they include services for organizing and conducting excursions, services of a guide (guide), services of a guide-interpreter, services of an accompanying person.
Excursions are classified depending on the content, subject, venue, category of participants, form of conduct and other features. Depending on the content, excursions are divided into overview and thematic, according to the method of movement, excursions are divided into walking, excursions using various types of transport and combined (transport-pedestrian). According to the composition of the participants, excursions are divided into excursions for Indian tourists, for foreign tourists, for religious pilgrims, for people with disabilities, including the disabled. According to the form of conducting excursions, they are divided into ordinary, route, educational, game, interactive, animation (excursions-extras, excursions-walks, excursions-concerts, excursions-performances, etc.). Depending on the complexity of the route, excursions are divided into ordinary and with active types of movement (along categorized tourist routes, difficult natural objects and territories). Depending on the number of participants, excursions are divided into individual (from one to five tourists) and group (more than five tourists). Depending on the duration, excursions are divided into short (up to three hours) and long (over three hours). Depending on the time of the tour, they are divided into daytime, evening, nighttime.
For the purposes of this study, the figures for the entire market of excursion services will be considered, without division into conditional market segments.
Assessing the state of the Indian tour services market, it is important to consider that it is closely integrated into both the Indian and the global tourism industry. Excursion services are provided to local residents, visitors from other regions, foreign tourists, respectively, the volume of excursion services depends on the development of the tourism market in India. In recent years, the government has been actively encouraging domestic tourism in India, offering a refund of part of the money spent on a tour, in addition, due to the holding of world-class events in various cities in India, the interest in the country from foreign tourists is increasing. All these facts directly affect the market of excursion services, since the most interesting and exciting walks are with guides and guides who own interesting facts from history and are able to fascinatingly tell and show the most significant places in a particular region of our large country.
1.2. Growth rates of the excursion services market
Growth rates of the excursion services market in 2016-2020 allow us to state that the market is in the growth stage, this is indicated by a clearly positive trend in the development of the market, despite the decline in indicators in some periods, high growth rates with a positive forecast for the development of the tourism industry as a whole.
Diagram 2. Dynamics of the market volume of excursion services, 2016–2020
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1.3. Excursion services market trends
Today, the main trend for all markets is the trend towards digitalization. In the excursion services market, this trend is also obvious: audio guide services are now widespread, the use of applications and digital services, such as the RUSSPASS service, which offers tours and itineraries, guides, as well as bonuses at partner restaurants, is increasing.
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The trend for patriotic education and educational tourism. The organization of excursions for the younger generation and the development of children's tourist programs is an important component of both the professional navigation process and the education in children of a respectful attitude towards the cultural and historical values of India, the military-patriotic heritage, instilling an interest in traveling around the country and, in general, reviving the foundations of local history .
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Based on the results of all of the above, GidMarket analysts concluded that the excursion services market and the tourism industry as a whole are experiencing a period of growth due to the development of new segments and areas of tourism activity, as well as the active transformation of the industry due to the introduction of modern tools and technologies. At the same time, it is worth noting that it is not worth talking about replacing live guides and guides with applications and virtual assistants in the near future - all existing excursion programs are copyrighted, they require in-depth knowledge of the excursion object, as well as additional knowledge and willingness to answer questions that arise, which is artificial the intellect is currently unable to do so.
1.4. The main problems of the industry
For many years, the main problem of the excursion services industry has been the problem with the regulation of the activities of tour guides and guides, namely, the lack of clear legislation that would regulate the market, primarily in terms of the qualifications and professionalism of those who provide such services.
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In accordance with the bill, uniform standards will be established at the federal level for the provision of services of guides, guide-interpreters and instructor-guides, the procedure and criteria for their certification and requirements for education, experience, professional knowledge and skills of a guide.
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1.5. Stage of the life cycle of the excursion services market
The market of excursion services in India is at the stage of maturity. At the initial stage of maturity, the market continues to grow due to the established consumer base and increased consumption volumes. In this case, the increase in consumption is largely associated with the development of inbound tourism, as well as with the development of new segments and directions of domestic tourism, which makes it possible to form an offer for new segments of the target audience, enter new markets (gastrotourism, agrotourism), stimulating the sale of excursion services . The maturity stage is characterized by a stable level of sales with a slowdown in growth rates.
The maturity stage is the longest of all life cycle stages. It is characterized by stable consumption, publicity and a wide range of services - all this ensures a stable level of sales over a long period.
The level of competition in the market becomes maximum and stabilizes, which, in the face of slower growth, creates a more aggressive struggle for existing consumers. A high value at the stage of maturity gets the speed of the company's reaction to the actions of competitors.
At this stage, the average price level is formed, and each market participant has an established price positioning. Price competition is decreasing, the role of the product brand is increasing, and sales promotion by lowering the price is short-term.
The breadth of the assortment at the stage of maturity does not increase, but undergoes a number of modifications and improvements to existing proposals. All changes in the assortment are aimed at maintaining the relevance and modernity of the product by tracking trends in consumer preferences and technologies for providing services. The services market is characterized by the emergence of new technologies, the improvement of previous approaches at the stage of market maturity.
At the time of reaching the stage of market maturity, the maximum coverage of the target audience is reached and, as a rule, a culture of consumption has already been formed. When working with the target audience, it is necessary to pay more attention to retaining consumers, searching for new niches, monitoring service satisfaction and prompt response when loyalty to the company decreases.
Advertising campaigns in the period of maturity should maintain the level of awareness of the company and services, as long as possible to keep awareness of the company's key competitive advantages in the mind of the consumer. At the moment of reaching maturity, the communication channels used are optimized in order to increase the effectiveness of advertising investments - maintaining channels aimed at high coverage and building loyalty, as well as maintaining channels that allow communication with consumers.
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1.6. Estimation of the number of buyers and their financial capabilities
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1.7. Estimated consumption per capita
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The volume of consumption of excursion services per capita in India as a whole correlates with the dynamics of the market volume, since the dynamics of the population over the study period, although it has a negative trend, is declining slightly.
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1.8. Analysis of sectoral indicators of financial and economic activity
Let's consider industry indicators of financial and economic activity of the excursion services industry to determine the sustainability of the industry and the enterprises operating in it.
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Table 1. Tourist Services Industry Gross Margin vs. All Industries in India, 2016-2020,
Gross margin is an economic indicator that characterizes the ratio of gross profit to revenue and allows you to evaluate the efficiency of an industry or enterprise.
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Diagram 6. Profitability of profit before tax (profit of the reporting period) in the industry of excursion services in comparison with all sectors of the Indian economy, 2016–2020, %
Profitability before tax is an economic indicator that characterizes the ratio of gross profit to revenue, in other words, how much profit is in each ruble from services sold.
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The current (total) liquidity ratio is a financial ratio equal to the ratio of current (current) assets to short-term liabilities (current liabilities). This is the most common and commonly used measure of liquidity. The ratio reflects the company's ability to repay current (short-term) liabilities at the expense of current assets only. The higher the indicator, the better the solvency of the enterprise.
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The absolute liquidity ratio is a financial ratio equal to the ratio of cash and short-term financial investments to short-term liabilities (current liabilities). The source of data is the company's balance sheet in the same way as for current liquidity, but only cash and funds close to them in essence are taken into account as assets. It shows what part of the current liabilities of the companies in the industry are able to repay at their own expense and in the shortest possible time and is used to assess the financial position of the industry.
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1.9. Price analysis
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At the same time, it is worth noting that during the study period, prices for bus excursions (per hour) grew at a more moderate pace compared to museum ticket prices, with the exception of 2018, when the price increase was caused by increased demand for excursions due to the FIFA World Cup in India.
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Table 3. Consumer price indices in the market of excursion services in India in 2016–2021 (available period), %
A reflection of the average prices for excursion services in India as a whole are the average prices for a bus tour (hour), let's consider the average prices for the union territories provided by Rosstat.
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The maximum average price per hour of a bus tour was recorded in the Northwestern Federal District, where the city is located, one of the leaders in India in terms of the number of attractions, in second place is the Central Federal District ...
Chapter 2
2.1. Economic components
Gross domestic product (GDP) is one of the most important macroeconomic indicators.
It reflects the market value of all final goods and services intended for direct consumption, which were produced for a certain period (quarter, year) in all sectors of the economy on the territory of the state for consumption, export and accumulation, regardless of the nationality of the factors of production used.
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2.2. Social Components
India's population is slightly declining in 2019-2020. (Diagram 3) - accordingly, the level of consumption of goods and services in the domestic market of India also slightly decreases.
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changing consumer habits - in recent years, an increasing number of Indians use the Internet to find the necessary information, obtain government and other services, which affects the change in habits. In connection with the restrictions introduced in 2020 during the coronavirus pandemic, the field of excursion services and the field of culture and education began to actively use online platforms and tools for organizing open tours, selling tickets online after the restrictions were lifted, which helped employees of these areas to save jobs, and for citizens in self-isolation to diversify their leisure time through remote visits to significant places and various excursions.
2.3. Technological components
the development of online tools is a definite plus, since it reduces the time for buying tickets, choosing thematic excursions, and also helps to promptly inform the population about upcoming events and new excursion routes;
high pace of technological change - restrictions introduced in 2020 due to the coronavirus pandemic have become an incentive to accelerate technological change in the excursion services industry - many organizations have begun to use the online broadcast format when conducting excursions, use or implement virtual technologies / augmented reality, use audio guides or virtual assistants and navigate through museums. As mentioned above, modern museums and tour agencies actively interact with the audience remotely - they realize the opportunity to purchase tickets online, use a virtual guide, and support a loyalty program. Digital transformation has affected all sectors of the economy, limitations. The pandemic-related ones have accelerated the pace of transformation – now tools are changing, new communication channels are emerging, and accordingly, market operators need not only to follow innovations and technologies, but also to be among the first to implement such technologies.
2.4. Political Components
State regulation of the excursion services market has been built up in stages over many years, at the moment the most significant bill has been adopted in the second reading, the regulation on the procedure for certification of tour guides is at the stage of examination before being sent to the Government of India for approval and signing. Consider the stages and their impact on the market.
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2.5. STEP-analysis of the excursion services market
Table 5. STEP-analysis of factors influencing the market of excursion services
Significant deterrents include a decline in purchasing power and population, a devaluation of the rupee and a decline in GDP.
The following political and technological factors and one of the social factors have a stimulating effect on the analyzed market: changes in the legislation regulating the activities of tour guides and guides regarding the mandatory certification of such workers, as well as their Indian citizenship, the development of online tools and changing consumer habits, as well as high pace of technological change in the industry. A significant positive impact on the market of excursion services was provided by the tourist cashback program - the return of a part of the amount spent on a trip within the country, proposed by the Government of India, which stimulated domestic tourism, and, accordingly, the demand for excursion services.
A positive influence of moderate strength is exerted by such a political factor as state support for the population in a pandemic (payments to families with children, an increase in unemployment benefits).
Chapter 3. Assessment of the degree of competition
3.1. Scale of competition (local, regional, national, global)
The excursion services market in India is characterized by a high level of competition, there are more than 300 companies operating in this industry in the country, in addition, there are also independent tour guides and guides registered as self-employed and self-employed in the market, their number, according to various estimates, exceeds 5 human. Experts and major market players evaluate competition in different ways, they are united in only one thing - the development of a competitive environment is based on such trends and market development prerequisites as high qualification, the use of modern technologies, innovation and flexible pricing. Given the changes in the market, only those companies that do not remain aloof from technological changes and changes in consumer behavior will be able to compete successfully.
Global competition in the market of excursion services is not expressed - there are foreign companies on the market, which are mostly involved in organizing inbound tourism for foreign citizens. When organizing excursion services, such companies, as a rule, turn to Indian guides-translators. There is also a practice when foreign tourists use the services of their own guides and guides. This approach is opposed by the Association of Guide-Translators, Tour Guides and Tour Managers, as well as major market players, evaluating such activities as capable of damaging not only the tour services industry, but also the image of India in the eyes of foreign tourists through an incorrect presentation of historical and other facts.
National competition is expressed at an average level. There are large companies operating in several regions. Other market companies are much less significant and most often operate in a particular region, forming regional and local competition.
Regional and local competition is the strongest in the Indian tour market. The competition is higher in those regions where there are a large number of attractions: historical sites, recreation sites, recreational routes, places of military glory, shrines and much more, which attracts tourist flows to the region.
3.2. Number of competitors and relative market shares of the largest competitors
Basically, the Indian market of excursion services is represented by companies focused on excursion activities, while large market operators also provide services for the transportation and accommodation of tourists, organizing their meals. It is also worth noting that many companies are not limited to excursion services in the region where they are registered, organizing excursions in other cities and regions.
Table 6 provides information on the 15 largest market operators, there are more than 300 such companies in the Indian market, in addition, services are also provided by independent tour guides and guides registered as individual entrepreneurs or self-employed - only according to some sources there are more than 3000 guides and guides.
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For the largest enterprises, the main activity is the provision of tourist excursion services, in addition, the sale of drinks, souvenirs, the provision of travel and accommodation services for tourists, and the full organization of tours (the activities of travel agencies) also bring revenue to such enterprises. The revenue in table 6 is shown for all types of activities of the largest market operators.
The market shares of the largest market operators are calculated based on the revenue of such enterprises in the “Provision of excursion services” line of business, calculated by GidMarket analysts in proportion to the volume of provision of these services in 2020.
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GidMarket analysts suggest that in the coming years, the list of market leaders is most likely to remain the same, based on the current market situation and factors affecting the market.
Diagram 11. Dynamics of the total revenue of the largest operators of the excursion services market (TOP-5) in India, 2016–2020
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3.3. Compact location of industry companies in certain regions
To determine the compactness of the location of companies in the industry, consider the number of companies in the states of India.
The largest number of companies operating in the field of excursion services operate ...
Chapter 4 Industry Forecasts
4.1. Analysis of the impact of recent crises on the industry (the global crisis of 2008 and the currency crisis in India in 2014)
In 2020, many markets felt the impact of the pandemic and the onset of the economic crisis, the excursion services market was no exception.
Let us consider the impact of recent crises (the global crisis of 2008 and the currency crisis in India in 2014) on the industry and the market of excursion services in India.
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4.2. Analysis of the impact on the state aid industry at the current date
The forecast for the development of the excursion services market in India is impossible without understanding the economic situation in the country, as well as the impact of the spread of the covid-19 virus and the measures taken to support the population, as well as businesses and industries particularly affected by the pandemic, which includes the tourism industry as a whole.
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4.3. Assessment of the degree of impact of the crisis due to covid-19 on the analyzed market. Barriers existing in the market of excursion services
The excursion services market in India is part of the tourism market, it is influenced by the same factors, and at the same time, the excursion services market depends directly on the tourism market in general and on tourist flows in particular. In 2020, restrictions were introduced around the world in connection with the pandemic of a new coronavirus infection, and this fact directly affected both the international and Indian tourism markets - the industry was recognized as the most affected by the pandemic due to the restriction of movement not only between countries, but and within the country between the states of India, the tourist flow in the first half of the year decreased significantly. After the domestic restrictions were lifted in the second half of 2020, with the closure of other countries' borders, domestic tourism in India increased, as did the demand for excursion services, also stimulated by the cashback program for domestic travel.
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4.4. Prospects and growth drivers for the excursion services market
The Indian travel services market has been undergoing profound transformation in recent years, driven by the following factors: global digital transformation and changing consumer behavior in India. Assessing the prospects for the excursion services market in India, it is possible with a high degree of probability to predict a further increase in market volumes by stimulating domestic tourism, strengthening the patriotic education of children and adolescents, strengthening India's position in the international arena and, as a result, increasing interest from foreign tourists. With the increasing pace of digital transformation that has affected all sectors of the economy, in the near future all participants in the excursion services market will somehow use the latest technologies in their work - virtual and augmented reality, cloud technologies for storing and demonstrating data, online platforms and tools that help approach all categories of consumers.
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4.5. Forecast for the development of the excursion services market in the context of the current economic crisis due to covid-19
The market analysis was carried out on the basis of methods based on identifying trends over time, adjusted for expert opinion in the industry. When compiling the forecast, methods of mathematical modeling, mathematical analysis and statistics were used, adjusted for market trends and expert opinions.
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Chapter 5 Forecasting Methodology
5.1. Methods for forecasting key industry indicators
Modern statistical forecasting methods are used, taking into account the actual dynamics of the industry and the impact of the current and projected general economic situation in connection with the spread of the covid-19 virus.
In addition, when compiling the forecast, changes in real incomes of the population, trends in consumer preferences in a crisis, development forecasts and the degree of impact of other factors affecting the industry are taken into account.
5.2. Sources of information for forecasting
Industry volume over the past 5 years
Industry dynamics in 2008-2009, in 2014-2015, in 2016-2020*
Dynamics of macroeconomic indicators over the past 9-10 years
Current public assistance plans
Databases of the State Statistics Committee of India
Indian Revenue Service databases
Open sources (websites, portals)
Issuer reporting
Company websites
Media Archives
Regional and federal media
Insider sources
Specialized analytical portals
5.3. Timing of forecasting
The forecast belongs to the medium-term category - 5 years (2021-2025)
Diagrams
Diagram 1. Market structure by methods of organizing excursion services
Diagram 2. Dynamics of the market volume of excursion services, 2016–2020
Figure 1. Stage of the life cycle of the excursion services market
Diagram 3. Population dynamics in India, as of 01 Jan. 2012–2021
Chart 4. Dynamics of real income of the population of India, 2012-2020, available period 2021
Chart 5. The volume of consumption in the market of excursion services per capita, 2016-2020
Diagram 6. Profitability of profit before tax (profit of the reporting period) in the industry of excursion services in comparison with all sectors of the Indian economy, 2016–2020, %
Diagram 7. Current liquidity (total coverage) for the industry of excursion services for 2016–2020, times
Chart 8. India's GDP evolution, 2012-2020, available period 2021
Chart 9. Monthly dynamics of the US dollar against the rupee, 2016-2021 available period, Rs. for 1 US dollar
Diagram 10. Shares of the largest competitors in the excursion services market in 2020, %
Diagram 11. Dynamics of the total revenue of the largest operators of the excursion services market (TOP-5) in India, 2016–2020
Diagram 12. Compactness of location of companies in the industry in certain regions
Diagram 13. Forecast of the volume of the excursion services market in 2021–2025
Tables
Table 1. Tourist Services Industry Gross Margin vs. All Industries in India, 2016-2020, %
Table 2. Absolute liquidity of the excursion services industry in comparison with all sectors of the Indian economy, 2016-2020, times
Table 3. Consumer price indices in the market of excursion services in India in 2016–2021 (available period), %
Table 4. Average prices in the market of excursion services in the Union Territories
Table 5. STEP-analysis of factors influencing the market of excursion services
Table 6. Main companies participating in the excursion services market in 2020
Table 7. Assessment of the impact of recent crises on the industry
Table 8. Analysis of the impact on the industry of the state aid proposed to date
Table 9. Forecast indicators of the development of the Indian economy
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