Group 4

Ita Theresa
Rocky Diego Mapandy
Indrawan Widjaja

Title of the Case

Make My Trip.com

Background of the Case

MMT is the largest India’s e-commerce company, an online travel services portal,
and has demonstrated spectacular results in the first few years of operation. It was
founded in the year 2000 by Deep Kalra. Created to empower the Indian traveler
with instant booking and comprehensive choices, the company began its journey in
the US-India travel market. It aimed to offer a range of best-value products and
services along with cutting-edge technology and dedicated round-the-clock
customer support. After consolidating its position in the market as a brand
recognized for its reliability and transparency, MakeMyTrip followed its success in
the US by launching its India operations in 2005. MakeMyTrip’s Products:
• International and Domestic Air Tickets, Holiday Packages and Hotels
• Domestic Bus and Rail Tickets
• Private Car and Taxi Rentals
• MICE (Meetings, Incentives, Conferences & Exhibitions)
• B2B and Affiliate Services

Identification of the Problem/s (and/or Sub-Problems)

Should MMT continue to target NRIs (Non-Resident Indian)? Or, should they expand
horizons and serve the foreign tourist market from the United States, the United
Kingdom, and Australia? Should the company continue to be an India-focused
company, or was it time to start thinking about competing with global giants like
Expedia and Travelocity?

Formulation of Case Objectives

The objective is to identify the best way for MMT in growing their business in the
relationship marketing context.

Presentation of Alternative Courses of Action

There are two choices which can implement by MMT,
1. MMT continue to target NRIs/India-focused company.
2. MMT try to serve the foreign tourist market and competing with global giants
like Expedia and Travelocity.

Analysis of all the Alternatives Presented

1. MMT continue to target NRIs/India-focused company.
It’s the core services of MMT which make them growing well. They have a
competitive advantage in the form of low cost and cultural conceive. The
challenge in this alternative is to keep the strong customer relationship as
long as possible. But for the long term, MMT cannot just rely on this strategy,
because there is a time where the profitable customers become non-
profitable customers and the management should know when and how to end
 their relationships. Also it’s important for MMT to improve their resources so
they can expand their market and try to serve the other tourist market and
other area.
2. MMT try to serve the foreign tourist market and competing with global giants
like Expedia and Travelocity.
The global giants have a larger bargain power for the other travel related
service companies than MMT because of their larger customer base. It mean,
MMT still cannot compete with them in term of the price for the services. But,
for the long term it’s good for MMT to expand their market as the company
grow and get more resources so that they can compete with the other
company.

Identification of the Best Alternative Course of Action

Since MMT cannot compete in term of the price for non Indian market, it’s better for
MMT to keep targeted the NRI for a moment while at the same time they can
improve their resources to prepare for expand their market.

Implementation Plan for the Recommended Course of Action

For short term strategy, better for MMT to keep targeted the NRI and improving
their services such as build a stronger relationship with the customers, improving
their service quality or improve their service products. For long term strategy, MMT
must prepare them self well and get more resources so they can compete with
other global giants likes Expedia and Travelocity.

Answers to the Guide Questions

1. Can MMT sustain its business model by targeting just inbound travelers, or does
it needs to look at other markets and segments? If yes, which segments would you
recommend? If no, how can they grow within the inbound segment?

Yes they can. MMT can sustain this business model for medium term, currently they
have 2,55% market share and the scope to expand within this particular segment
also exists. Further, currently only 35% of people buy travel services on internet
and this projected to grow to 55% in next two years which means that the pool of
customers they can target will practically increase in two years.

However, for long term success it will have to adapt its strategy because of the
following reasons:
• Consumer behavior – The studied by PhoCusWright in November 2003 found that
flight and rental cars are the travel services most likely to be purchased online,
while offline channels still dominate the travel activities category .

• Competition – The aggressive advertising campaigns from the competitor like

Expedia can take the MMT market share.

• Changes in Industry - The airlines might provide substantial discounts on their

web
sites and take MMT out of business if they don’t diversify.
• Emerging Markets - The high growth in India outbound travel might make this as
big if not the biggest segment in next few years. MMT cannot afford to leave this
segment untargeted.

Our recommendations are as follows:-

• First target the inbound corporate clients. You will spend less advertising cost to
capture this segment and the competition is not so intense.
• Develop customer loyalty within the inbound segment by
o Launch Loyalty Programs
* Give points for every travel in addition to air miles.
* Give large no of points for referrals.
* Give double points for value add services.
o Develop a CRM solution
* Analyze the profit derived from purchases.
* Profits from other customers that they referred to us.
* Change in the willingness to pay.
* Use of the extra services provided by us. And how much they value
those services.
o Give special trips and rewards to profitable loyal customers.
o Try to take the loyal customers from low price and low service segment to
higher service and premium price segment.

• Now move to outbound corporate segment.

o This will involve less advertising dollars as compared to the retail segment.
o Once they get used to the service they are less likely to switch.
o They have much higher Temporal Costs as compared to Retail travelers.
o Much higher chances of repeat business.
o Corporate clients will help us achieve volumes more quickly.

2. Ad revenues have never been core to MMT’s business plan. However, MMT’s role
in promoting some leading NRI focused brands suggests that this might be another
avenue that Kalra could investigate. Does MMT need to look at advertising as a
revenue generator?

We think it is a good idea, with a few additions. In particular, MMT needs to be

cautious about the following when doing it:

• It should not eclipse the MMT brand name. If we promote some product or
service
and the quality or experience that the user gets from that service is not right it
might
hurt MMT’s image.

• MMT should not overdo it. It should not do to a limit where it hurt customers
experience with us.

• If MMT wants to aggressively promote NRI focused brands it should open a new
company for this purpose, it can share the resources of MMT but it should be a
separate Brand Entity.
Also MMT’s core strength is in its low operational cost and lean structure. Currently
there is immense scope to expand business in existing segment (NRI’s to India and
NRI’s to destinations other then India) and new segments (India outbound). So if
MMT finds that it does not have enough resources i.e. manpower to handle
advertisement business then it needs to stick to its core business.

3. Can MMT’s business model work in other countries, in particular China,

Singapore and Philippines? Are there any differences in consumers and segments in
these countries that would render the model inadequate? What might need to be
changed in other countries? Could MMT expand in a modular manner by replicating
their business with overseas residents of other countries?

MMT’s key success factor is that it has low cost as the back office/call centre etc is
in
India. The low cost model can be adapted to China, Singapore and Philippines
because there are many citizens in both countries that are from Chinese ethnic.

Before expanding in a modular manner to any other country, MMT will have to
evaluate some parameters:
• The penetration of internet or the number of internet users in those countries.
(Infrastructure)
• The availability of payment gateways and government regulations on e-
commerce in those countries. (Infrastructure)
• The extent to which customers go on-line to buy tickets. (Psychological –
Consumer Behavior)
• Cost of creating a Brand Positioning in these countries. The cost of media and
advertising in these countries required to create a decent brand.
• The number of available competitors in those countries. The loyalty of customers
to the existing competitors.
• The economical and political condition of the country. The government rules in
the country.
• Understand the user concerns