Deep Kalra, Founder And Group Executive Chairman, Make My Trip, In Conversation With Rtn. Farhat Jamal
What are some of the broad travel trends you predict in the coming months?
Domestic tourism is definitely not only looking up, but it is at a place that there is no turning back. There are the expected concerns, though, after the Mumbai local trains have opened up. We have seen the story play out everywhere in the world when you get lax and that is when this disease comes and bites you in the back.
I saw that happen first in Europe. I was in Zurich in August and September, it was summer-time, and we were sun- bathing by the lake. When I reached there, no mask was required anywhere but on trams. There were 200 infections in the country. By the time I left the country, it had gone upto 500 and a month later to two-three thousand a day and the whole country shut down.
So, I am worried that if we open up the way we are, in a country like ours where Covid existed only in the cities and no one believes it is there in the small places. I get good insight through Aarogya Setu which, by the way, my company very proudly built for the country. We are very connected on it and I can tell you the only explanation why the numbers have come down today is herd immunity. There is no other explanation, everything else is ceteris paribus – nothing has changed.
Coming to travel, closing January we were at 62 per cent of pre- Covid levels. This included the long weekend of January 26th, domestic aviation, domestic hotels, we were in the 50s led by premium hotels, and homestays which have been the big silver lining for this pandemic. They have become mainstream because they are safer than going to a large hotel.
We also have a brand called Redbus, the leading brand for intercity bus travel, which also is back at about 60 per cent. So, domestic travel is back at 50 to 60 per cent.
International travels are a totally different story, there are very few places that an Indian passport with a tourist visa can take you and one of them which we over-invested in was Dubai and we saw what happened in Dubai over the New Years. But Maldives and Dubai were the two touristy places. You could go to US and UK, obviously no one wants to go there, so it is only business and student travel happening there.
So, international travel is still in single digits, it will stay.
Interestingly, you can expect the opening up of two things – inbound travel with protocols but not with quarantine, that was our request, that if you are opening with quarantine it kills it. Thailand has opened with quarantine for two weeks which doesn’t make sense, by and large. So, inbound is opening in the Far East, you can see the Buddhist circle open for Japanese. I think we are going to be selective but clearly the government is keen to open up.
Outbound will depend on the partner countries and if they want to receive us, if our numbers stay at these levels, for another month, half of the world would want Indians to come with a test because if we keep 10,000 a day for a country our size and they start insisting on an RTCPR test on arrival, countries that are hurting now on tourism are looking at opening up. With vaccination on other hand, playing catch up, we can only hope that worst is behind us and this summer onwards we are at normalcy at least in domestic and by the winter we are normalcy in most of the world except countries who mismanage.
How do you expect the travel and hospitality to change once people start travelling again?
Firstly, people have already made the changes, will these last or not? So, the big changes – I have to give them credit, including the Taj, Taj was leading in this, saying they were going to open up, people were ready to travel. And it is a chicken and egg situation, if we wait for them to come and we don’t open up, then they will go somewhere else. As the largest chain, I compliment them for opening up wherever they could and for very good Covid health protocols. I have done six trips in Covid: two international and four domestic, driving and flying because if we can’t travel, I can’t expect my customers to travel, it is bizarre. We did a leadership meet, the first one in Covid, last week. It was a one-night two-day affair in an open-air resort in Delhi. I told everyone to do a test before coming. All 41 of us were tested and now it has been two weeks and I think we are out of the woods. But that is the kind of norm. Hotels are doing very good protocols by and large. But I saw an independent hotel with a buffet service where it was self-serve, in Kashmir and in Delhi, and I told them that is a recipe for disaster. Instead, why not have an employee stand behind the counter with a mask and gloves and he is the only one who is serving. Why do you want everyone to touch the same spoons? So, small things, but big changes, some have been spectacular, you do not feel uneasy at all. I have not seen a single staff member remove the mask at all, they will have surgical masks on all the time, they remove their gloves, change the gloves. Are you taking a risk going to the hotel? Of course! Are your safer at your house? No question. But I think today you have reached a point where if you stay in your house without going out, you will go bonkers. I think people need to get out, for work. My brother stays in Bombay, his family came over, we were meeting after 11 months, they came here and were staying with us. They said they had never seen Vistara at Bombay airport on a Saturday morning busier. There were serpentine queues going outside spilling over into the taxi lane. Everyone is back to travelling so we have to be even more careful. Hotels and airlines have been spectacular. I was very impressed by Go Air, they didn’t let me remove even my face shield during my four-hour journey, forget the mask. It was very uncomfortable but what the hell, you were safe and enjoyed your holiday.
We will have to get used to the fact that we will wear masks whenever we are in crowded areas. We used to smile a little bit when we saw our friends from Japan and Korea wear masks after SARS-2001. We said these guys were crazy, hyper, but these nations have been phenomenal in controlling the virus. Even in Thailand and Vietnam, it’s been spectacular. So, it’s about discipline. If we don’t do that, we keep jostling with this thing for a couple of years it won’t go away. But if we do the basic things, like wear a mask in crowded areas like malls, I think we will win.
What are the short-term and long-term impacts of Covid 19 on tourism and travel business?
In the short term, it is very clear, that if there is one industry that is going to be hit hard, it is going to be travel or anything experiential. Look at movies, my friend Ajay Bijli runs PVR, we keep talking whose business is hurt more, his or mine? We can keep arguing but both are badly hurt. Ironically, I must say we have no mention of Travel and Tourism in the Budget, so it is painful, we are trying to talk about it. But long-term is interesting. As I said, one of the silver linings in Covid is mainstreaming of the alternate accommodation or the homestay, the villas and apartments. It was never a thing in India. Some places like Goa, Coorg, Ooty and other hill stations had villa culture, but now it has become mainstream. Obviously, Indians don’t have many secondary homes, but they are going to do it because of the servicing infrastructure which didn’t exist. But today, if you go to Goa, there are 80-100 companies which can service your apartments, and they say basically as we know in India, we need to clean your home once a day if not twice because of our dust. Secondly, during Indian holidays, they don’t want to cook themselves, they would want to carry their Maharaj also, so, that service is available. You don’t have to worry.
Another thing is hygiene awareness and protocols are all going to help us. The mask is going to become a norm, we have to lead in that, we should never lower our guard. We have to set the example. Tourism will get impacted, business travel is hurt really bad, it will take longer time to recover. We have seen, who is travelling today? Leisure one and visiting friends and relatives and thirdly the SMEs, Small, Medium Entrepreneurs, fourthly are the feet on street otherwise large companies are not travelling, MNCs are not travelling at all. Honestly, people are going to question the need to do certain kinds of travel, 10 days ago we closed a fund raiser at the back of a good result, we raised 230 billion, and it started with a zoom call with Hongkong at 8.00 in the morning and ended at 2.00-3.00 in the morning because we were just doing the allocation. All of us, some in jest wearing track pants below and a shirt on top, that is the reality in your home, in your couch, it is not like you are forging it up, everyone was comfortable. Lot of my investors were in casuals, and everyone was relaxed. Imagine how much money we saved by four of us investors and bankers not travelling.
People have become very efficient now. Honestly, I am not looking forward to getting on the road for something I do not enjoy. So, I think all of these will take a long time to recover. Corporate travel will take two years to come back, while leisure travel will take a year.
What about the destination weddings? Apparently, it is been shooting up.
Absolutely, that has just started, how long will you hold off a wedding? So many people have had weddings. Which is fair, but the destination wedding has always grown, now it has got a filler because with destination wedding you achieve two things, especially if you are in Bombay, you get space and second you limit numbers. So, it is becoming a norm, it is a thing to do, people enjoy much more because they mentally check out and don’t have to manage and balance the work life.
But with the pandemic, what do you suggest are the safest trips that people can take according to you?
Clearly, driving and staying in strict protocol hotels or homestays is safest. Drive close. And when you reach the holiday destination, be careful, we tend to let our guard down there. So, you reach Goa and you think of it is cool, that is exactly how it spreads. That is what happened in Dubai. Both of my kids went to Goa, thankfully they didn’t go to Dubai, I was actually telling them to go to Dubai. When they came back from Goa, they were pretty paranoid, they were wearing masks at home, they didn’t talk to us, they said they were sure that they had been exposed. Luckily it was touch and go.
How hard will it be for the cruise line industry to beam up their image?
We do serve cruises as well. This coin has got two sides, in some way the cruise liner is a complete disaster if there is the virus. But if you flip it and you isolate everyone, test them and immediately they are boarded, then it is best. But you cannot get on the cruises that get off at cities, then you go to Alaska, high seas and remote places. I have never been a lover of cruises so, I can wait, but cruises should have a strict testing regimen. That is the only way they can go ahead.
With the increased focus on digital, do you see the traditional travel agents making a comeback?
Definitely, there are two most resilient species in the world, one is Indian and even more resilient is the Indian travel agent. There are certain services in which Indians lead and we are spoilt as a country, the moment we make a little bit of money or we reach a certain stage, we have a secretary to do our work, which doesn’t happen in the west. In the west many CEOs do their own bookings and their dishes, they don’t think it is a big deal. There are many people who also send someone for the Visa, so, Indian travel agents will have to do other services that are value-added and cannot be done online. Today 70 per cent have engaged in online transactions, people are convinced it is safe.
I would say, we spoke holiday online, it is still hard to do it online, for instance you plan to go to Ladakh, obviously you can do it online but there are mnay things you are comfortable talking to someone rather than doing it online, so, the travel agent who is ready to reinvent is here to stay. Those who don’t and who stick to do doing tickets and all that, I think they will face challenges.
What is the government thinking when it skipped travels and tourism from the Budget?
I was going to say that you or someone who knows government better tell me, we did do a session with the Finance Minister and the Secretary of Revenue and Economic affairs and when we brought up the point, Puneet brought this point actually and the secretary said I’d like to talk offline about it, why can’t tourism become a subject in concurrent list or can it be included in infrastructure status? Many states are doing it, it was a fair ask and there was no money from the government. One thing has become clear, wherever you are asking money from the government, we are not getting. Sadly, the perception of tourism in the country when it comes to government level is that it is a 5-star industry. So, a luxury industry made for the rich. Puneet also mentioned to the Secretary that it is a ‘sair sapata’ industry and that is what people think, that has to be changed. I found it ironical because our PM in one of his first speeches spoke about 5 Ts and one of them was Tourism. So, there is some disconnect. The travel tourism budget was actually cut down, we are struggling, we are in desperate need of help, one of my suggestion was don’t give money today, you want domestic tourism to come back, why don’t you go like ATG benefits. If you do a domestic trip for the next two years, you get a tax benefit. Small things make a big difference many a times these incentives help.
RAPID FIRE
Which management book has influenced you the most?
Good to Great by Collins and Nuts! Southwest Airlines’ Crazy Recipe for Business and Personal Success
Outside the travel sector which business leader have you drawn inspiration from?
Jeff Bezos – Amazon
Favourite or recommended holiday destination?
For me Maldives is paradise on earth, I have gone 7 times and I am ready to go back again. Also Ladakh and Andaman. And Gulmarg this winter was as beautiful as Alps.
Favourite adventure sport?
Scuba diving
Short Management advice?
To young entrepreneurs, the most under rated quality is perseverance and resilience, if you take up something, at the first sight of winter don’t call it winds. Just keep at it! Youngsters are very restless, enjoy the journey, stay focussed and keep enjoy and keep learning.
Favourite food?
Comfort food is home food – daal chawal, Mutter road, I am pretty much in the group of Eat to live! But I enjoy my food for sure, thai food is my favourite out of Indian.
Did you lay off staff in this period and how did they manage? Any follow up on the staff who were hard-pressed?
Yes, we had to take hard decisions during the pandemic. We tried not to lay off anyone for two months but our revenues came down to 95.5 per cent in the first quarter. I started asking senior members to take cuts, my co-founder as well as me, we took a 100 per cent cut for six months, leadership team took 50 per cent cut and then down to management team which took 10 per cent cut.Everyone was together but eventually we had to lay off 10.5 per cent of our staff which was, in my 20 years of at MMT, the toughest and the most horrible decision ever made. It was also horrible for the person on the other side because we knew they might not get jobs as they are in travel. So, we tried to make it easy, we continued their medical benefits for the whole year, we let them keep their laptops and mobile phones. It was very hard, what I learnt was it is easy to hire in good times, but it is really hard to let go. But there was no way! We restored salaries three months back, and we are looking at some of the folks but we are not able to take all of them back.
