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Hybrid Retail Ecommerce going offline- Converging of the two mediums

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Ezeego1.com is a comprehensive online portal that provides end-to-end travel related services. Conceived with an intention to provide the Indian traveller a ‘one stop platform’ to service all their travel needs, Ezeego1.com was founded in 2006 with a market place concept, offering one of the widest range of travel products in the Indian market. Ezeego1.com is designed on a three-pronged model to cater effectively to the B2C segment with its end consumers, the B2B segment that includes travel agents, followed by the franchises. Neelu Singh, COO of Ezeego1 talks about the future plans and offline model of the company.

Treading on the Hybrid Retail Model

Ezeego1.com after registering a strong presence in the e-commerce sector has also marked it’s offline presence all over India with 20 stores. Ezeego1.com franchise stores are present in Surat, Munnar, Chennai, Srinagar, Hyderabad, Bhubaneswar, Ahmedabad, Delhi, Meerut, Noida, Ludhiana, Nagpur and Gurgaon amongst other locations. The company is clocking a growth of 30-40 per cent y-o-y.

“We currently have a strong presence in 11 cities through our 20 franchise stores. Franchising is one of the key growth strategies. We plan to open 30 offline stores by the end of the year, all of which will be franchisee owned and operated. While we are open to considering applications from all over the country, we are primarily targeting tier II & III cities to facilitate deeper market penetration.” says, Neelu Singh.

Market Dynamics

The travel industry in India is fragmented and there is no reliable data on market share. Additionally, every organization’s business model is diverse with different focuses, which makes it almost impossible to track the overall market share. The online travel space goes beyond just ticketing. Different companies can be leaders in different product segments. Some might be leaders in ticketing, some in holiday packages and so on.

Ezeego1.com caters to B2B as well as B2C markets, which makes our product offering diverse. There are different products, and each product contributes significantly to the overall revenue pie.

” We are leading in several products in the B2B as well as B2C space. It is predominantly product specific and does not define the ultimate leader. We are growing at double digits and we will continue to strengthen our online and offline presence to more tier II and tier III cities to achieve our objectives.” adds, Singh.

Evolving Trends

Travel as a concept has evolved significantly over the years. Fleet expansion by airlines, new supply of hotel rooms and easier booking methods have all been instrumental in planning a trip a lot more convenient. The long-term growth outlook for India’s travel market remains robust. According to a recent industry report, gross travel bookings are estimated to reach $28.8 billion in 2015 as compared to the $19.6 billion last year, and online gross bookings are estimated to touch $12.5 billion, up 80 per cent over 2012.

As far as leisure travel is concerned, people have been taking holidays more frequently over the past couple of years. These are shorter breaks aimed primarily at rejuvenation and seeking new experiences.  We see the younger generation planning a quick getaway at least twice a year. Travellers are showing keenness to go beyond the usual tourist attractions. Customers are planning early and booking well in advance, a trend that is shaping up strongly. Cruise holidaying is a new trend that is rapidly evolving and is surely going to catch on in the coming years.

Market positioning and customer profile

According to Singh, “Today, we see that customers are getting aware and like to make informed decisions. The disposable income of the middle-class has also increased and people do not mind spending a little more for a memorable holiday experience. This year we introduced a unique package called ‘Your Europe Your Way’ wherein customers can choose three cities of their choice, from a wide array of options, and get the fourth city absolutely free. They can even select the sightseeing options that they wish to see, without having to adhere to a standard group format. The positive response that this package has been receiving makes us believe that the current trend is for travellers wanting to move beyond a standardized itinerary and explore unexplored aspects of a destination, rather than popular sightseeing options.”

Initiatives

“Since inception, Ezeego1.com follows a ‘Customer first’ philosophy, which has helped the company stay ahead of the curve, continually meeting our growth parameters and customer expectations. We believe that growth cannot compromise customer experience. This, in fact, is our driving philosophy. With customer centricity as its core DNA, we have a zero tolerance policy towards any processes or actions that in any way hinder an ideal customer experience. Every decision and action is derived to empower our esteemed customers with the right tools and choices to make their holiday hassle free and truly memorable. We have a dedicated team who meticulously designs holiday packages to effectively cater to your requirement, be it food, shopping, adventure, romance or anything else.” says, Singh.

Services:

Each of the franchise stores is an extension of Ezeego1.com website. The store  provides the following travel services which are offered on the website.

  • Airlines: Flight tickets for full service and low cost airlines across the globe
  • Hotels: Real time access to around 5,00,000 hotels around the world
  • Holidays: Over 1000 holiday packages covering 64 countries across the world
  • Sightseeing: With the right amount of extensive research, from culture & heritage to adventure activities, we provide spectacular sightseeing options that make for a perfect holiday
  • Cruise booking engine for a holiday of luxury and opulence
  • Direct interface with Rail Europe
  • Complementary travel services such as Visa, Forex, Insurance and a lot more

“We strive to provide value for money vacations and we tailor make our packages accordingly. The price of each product varies as per the customer requirement and preference. Fluctuations in airfares also have an impact on holiday package prices. ” adds, Singh.

Location:

“We prefer high street locations with proper visibility. Also, high street works better, as they attract more serious buyers. We are currently targeting tier 2 & 3 cities. We are not looking at shop-in-shops, for now.” reveals, Singh.

About the stores:

Each store is about 200-400 sq. Ft. in size. There is an average investment of around six-eight lakhs in setting up a store. The return on investment is around 12-18 months, subject to franchisee achieving its target based on the location. Each of the franchise is identical in the product offering. Ezeego1.com provides all franchisees with an active marketing, technical and store development support. The marketing activities include print and radio advertising, attractive and preferential commercials. All stores are designed to reinforce the brand’s look and feel. The retail margin varies from product to product as well as destination. Average margins range from 5 to 15 per cent.  Around 40 per cent of our operating stores are profitable.

Strategy for loss-making stores

Stores that have been in operation for more than six months and have not achieved operational break-even are identified for special monitoring and course correction. Post analysis of the root-cause of their inability to break-even, a customized action plan is drawn up to nurture them back to good health. These stores are mentored by the respective Account Management Team and supported by Regional Sales teams. Breakeven is around four to six months for operational stores, subject to franchisee achieving its target based on the location.

Expansion Strategy:

“We plan to open 30 stores by the end of the year all of which will be franchisee owned and operated. While we are open to considering applications from all over the country, we are primarily targeting tier II & III cities to facilitate deeper market penetration. ” reveals, Singh.

Human Resources:

All thestores are franchisee owned and operated. Ezeego1 provide training and technical support to all franchise staff to effectively address the changing technology and enhance customer interface.

Future Plans:

Singh, reveals, “We plan to open approximately 15-20 new stores every year. We plan to open around 30 new stores in the next two years with special focus on tier 2 & 3 cities.”

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