How Hyperlocal Travel Start-ups are Disrupting the Indian Tourism Space?
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When Sharib Khan, a tech blogger based in Hyderabad, visited Delhi to attend a technology conference, he wanted to visit Old Delhi where he was born and spent his early childhood days. But he had no one to take him through the Old Delhi’s madness. Searching on Google, Khan came across a platform called SeekSherpa that would connect him to a local expert for a micro tour of Old Delhi.
“This online platform arranged a local guide who knew a lot about Old Delhi. He took me through the lively chaos of the city. He even took me to the locally famous ‘Paranthe wali gali’ which otherwise I wouldn’t have located by myself,” says Khan.
There is a staggering number of travellers who are preferring offbeat locations to get the local, unique real-life experience. Although there is no aggregate figure for the industry size, as per start-ups, the market is about 10 million tourists strong. According to the Ministry of Tourism report, the market is worth $3 billion in India while it is around $140 billion globally. Catering to this huge hidden demand are start-ups like SeekSherpa, Padhaaro, GuideTrip, Tushky and Be The Local that have cropped up offering hyperlocal or micro tours of a place, local cuisines and local markets and arranging haunted tours, photography tours and local industries’ tours.
While SeekShepa and Padhaaro mainly focus on the domestic market, GuideTrip gets maximum business from around 45 countries. On the other hand, Be The Local offers guided tours to Dharavi slums in Mumbai. “We reintroduce the city to travellers. There is a shift in the way they spend their time by going for movies and dinners, watching plays, etc. to understand the city like a local does,” says 23-year old Dhruv Raj Gupta who co-founded SeekSherpa along with his college friend Sukhhmani Singh in February 2014. The start-up was among the first batch of the Nasscom’s 10,000 Startups programme and was accelerated at angle-backed start-up accelerator VentureNursery. The company raised around Rs 40 lakh from the accelerator.
“Tourists have evolved themselves. They are now becoming social travellers and want to do something offbeat and connect with local people, their culture and history to get a real sense of the place. That is why, there is more demand for local experiences and hyperlocal activities,” says Ish Jindal, Co-founder, Padhaaro. Jindal realised this opportunity while on a trip to Moscow where he couldn’t find anyone to guide him about the city. This came to him as a big area to work for tourists who are coming to India given the diversity of culture, languages, etc. India has. Started in October last year, Padhaaro was a part of the Morpheus accelerator batch that invested Rs 5 lakh in it.
Sameer Guglani, Co-founder, The Morpheus, says, “If you have a person who has lived in the city or place you want to visit, you would connect with him instantly instead of hiring a traditional guide. The demand for such services is huge, and it will explode in the next few years. We liked the intention of Padhaaro’s founders to improve the quality of experience of tourists by acting as a platform for people to discover such things and connect with local experts.”
New Avenue for Guides
Acting as a bridge between local guides and travellers, these start-ups invite people, who know about a particular place or activity, to share their expertise on their websites. Start-ups also ask them to sign up along with the details of the tour including charges based on the tour and number of travellers. This can range from single-traveller to group tours. For example, a three-hour tour to South Delhi-based residential area of Mehrauli (Qutab Minar, Jamali Kamali Mosque and Tomb) will be for 1-10 people at Rs 800 per person cost that includes local guide’s fee, transport fee, water bottle and maps of the area with one-two day advance booking. The traveller can browse through the website and choose from different experiences and tours or can even request for a personal tour. This is much cheaper than local tourist agents who also don’t entertain single travellers.
The start-ups look for those who are passionate about their place or city and love sharing their personal experiences with others and making money in return. Once the tour is completed, start-ups earn through the commission they charge from these guides which is usually 10-30 per cent of the tour cost.
Arjun Sachdeva, a travel enthusiast, founded the theme-based travel start-up Let’s Get Packing in 2012. He came up with his start-ups’s online avatar as GuideTrip last year in October. Since then, it has scaled rapidly to 45 countries with primary focus on South Asia and South East Asia and North Africa, offering unique tours and activities through locals. However unlike other start-ups, the company has full-time local guides working as professionals offering photography tours, ocean side excursions, cycling and bike tours, haunted tours, etc. “This is beneficial for guides as well, as they usually have to give away 50-60 per cent of their commission on every tour to their travel agent; whereas we take only around 10-20 per cent from them,” says Sachdeva.
Particular to this market, getting visibility among travellers and curating the sign-up process for guides and maintaining consistent quality are bottlenecks for start-ups. While local experts of the city and places where start-ups operate can be easily acquired, the real challenge is about travellers discovering the availability of such services. Social media, digital marketing and word of mouth are some of the obvious ways for these start-ups. Moreover, tying-up with offline travel agents and hotels are also helping them grab the attention of their target customers.
“We partner with offline travel agents and hotels, and in the online space, we partner with travel mobile apps, online travel agents or use metasearch engine for travel,” says Jindal. The value addition for offline agents and hotels offered by these start-ups is the guided tour that otherwise only provided with ticket booking and commuting services to travellers.
Other way to ensure getting consistent bookings for micro tours is by being visible on third-party websites like influential bloggers who are the first source of contact for target market. New Delhi’s leading four hotels work exclusively with GuideTrip’s experts. “It will take around 12-18 months before you can see huge demand for guided tours,” says Gupta.
In order to stand for quality experience offered by experts, these start-ups have put in a sign-up process before getting experts on their portals that includes identity and contact verification, social media verification, understanding their area of expertise, face-to-face/video interaction, etc.
“Verification of experts makes sure that they can conduct tours in a unique and hospitable way. We do identity and contact verification of all experts,” says Gupta. “Our guides upload their licenses and share their personal information and then we verify the information. We also conduct an internal review on the basis of their responsiveness, languages they can speak, etc. We also ask travellers to rate our guides on our platform,” states Sachdeva. On the same note, Guglani says, “Maintaining consistency to deliver quality experience will be the key to become the winner in the segment.”
Next Big Thing
With mobile being the growth driver for most of the e-commerce ventures, the hyperlocal market will be no different as the real growth will come out of mobile in next two-three years.
While SeekSherpa will be looking to expand to every major tourist destination in India like Nagpur and Pune, GuideTrip claims of being available in all 193 countries, becoming the largest provider of tours and activities in the world in the next three years. The company will also be raising its seed round of around $150-200k by next year January and is already in touch with multiple investors.
Padhaaro, moreover, wants to remain focused on 20 cities (which get maximum tourists) it is currently present in, while expanding its network of experts to 1,000-1,500.
The market’s potential is vast. However the growth will be gradual with the increase in awareness among travellers to book tours for local experiences and spread the word of mouth. Hard to say about the CAGR of the sector, but India will see a steep rise courtesy to mobile penetration.