I
have often wondered “What is it that makes some online businesses click while
others not so much as create any ripple at all?” and more often than not the
answer that I came up with was “The Business Model”. Well, that is very obvious
and anyone with some understanding of the internet and business in general
would be able to tell you exactly the same thing – If you put together a true pain point of the consumers with
an online service delivery platform that should automatically create a
successful online business. In principle it is that simple, but in essence it
is much more complex, otherwise you would have a lot more of Flipkarts,
Cleartrips, and Naurkris, etc. Apart from the online platform itself (which can
be very complex system in most cases) there are a lot of other systems like the
order fulfillment, logistics, and supply chain management (to name a few) that
make setting up the business ecosystem a very difficult proposition. Discussing
the various sub-systems involved in an online business can be the subject of an
entire book, so I am not going to venture into that. However, what I am going
to discuss during the course of this article is a very important part of the
consumer experience in the online business model – The USER EXPERIENCE. The
discussion would be based on my personal experience as a consumer on various
e-commerce platforms, my understanding of the online business from my
experience as a web analyst in the past and from the many articles and books by
experts on the same subject. Hope you enjoy reading it!
What is wrong with this picture?
There is a specific reason online companies sometimes clutter their
homepage with advertisements – Ad Revenue. But is it worth risking a good
consumer experience? Maybe it is and as a result some of the best
companies in the business have such a messy homepage. Maybe in some cases
consumers have become accustomed to these kinds of homepages that provide an
information overload. I am not going to get into guess estimates to calculate
the cost profit analysis of putting up with bad home page experience at the
expense of losing new customers who might otherwise have shopped with you. But
what I am going to do is share my own experience.
I had heard my friends talking good things about cleartrip.com and
decided to visit the site. It was almost like love at first sight.
No clutter. You go to the homepage
put in the details and do a simple SEARCH to get the results. As simple as
Google search – no ne
ed to look for the search section like in makemytrip.com.
There
are a lot of features where cleartrip outclasses makemytrip. I will just tell
you one and the most evident (apart from the simple UI, which I just love).
Once
you have started the search process and based on the price you think you want
to change the travel date (to get a cheaper ticket), cleartrip provides a
feature that is simply AWESOME. Look at the picture to judge for yourself:
BEST FARES IN Month – This feature makes it easy for me to view the cheapest flight fares during the particular month, no need to do repeated searches. Repeated searches are exactly what you need to do in makemytrip.com
But
I couldn’t break off the long term relationship (not exciting though) with
makemytrip based on just this feature, now could I? Then
the miracle happened – I was booking my ticket for the summer vacations and had
just got a great round trip ticket fare. But as I was going to book it, the unthinkable
happened – Makemytrip informed me that the tickets for that flight were no
longer available – that was it, I had a reason to finally get out of this
relationship. Without a moment’s hesitation I packed my bags, logged out and
have never logged back into Makemytrip since then. I now book tickets on
CLEARTRIP.com
I
like their e-tickets better too. Judge for yourself:
And
this was Makemytrip’s:
You
can clearly see that the timing of the flight is very obvious in the cleartrip
tickets whereas it is not so in case of makemytrip.com. And for the love of GOD
please don’t show me ads on the ticket. Do you really think anyone reads those?
(Okay maybe some customers do)
Well,
now all of you might be thinking – Enough of this UI (user interface) and
consumer experience “gyan” – how has it affected the business of the two companies?
That
is exactly what we are going to look next. Oh, by the way, my dad who is an
internet novice thought that it was easier to search for tickets on
CLEARTRIP.com than on makemytrip.com – when I asked why? – He simply said - “It
looks simpler”
Show me the MONEY! – How UI affects business
Now
I haven’t looked at the financial statements of both the companies (we will
have a brief look in a while), but I am sure we can definitely pick up some
interesting insights from the search data available from Google.
Google
Insights for Search is an interesting tool that Google provides which can
provide some indicative data related to search. For example when I tried
comparing the search terms “makemytrip” and “cleartrip” for the time period
from Jan’06 to Jan’12 in the “Air Travel” category (this was intended to find
the interest level in the two rival companies), Google threw up the following
graph:
To
start with if we look at the 2006 data, we find the Cleartrip pretty much
started getting its first visits during that time whereas Makemytrip.com was
already up and running and hence the big difference in the interest level in
the 2 search terms (blue line - makemytrip, red line – cleartrip). Makemytrip was obviously
the goliath and had an unassailable lead at this point. However, thanks to some
of the features just mentioned and a host of others that were not discussed,
interest level in cleartrip started to rise slowly but steadily until after
2009, the blue and red
lines intersected and for some time cleartrip even trumped Makemytrip. Given
the constant innovations like the personalized dashboard, cleartrip will
certainly become more and more popular at least in the AIR TRAVEL category and
this would mean more revenue.
Cleartrip.com dashboard – Another feature I just love – it
has seamless integration with Google calendar as well
Makemytrip.com dashboard – That’s it?
|
Let’s
now take a quick look at how the search term “cleartrip”
has grown relative to the Air travel (Industry/category context). Clearly cleartrip has outperformed both makemytrip and air
travel when compared to Jan’06 numbers.
These
numbers also have another interesting story to tell apart from the obvious fact
that cleartrip has been performing really well. Cleartrip in spite of having a
very little offline marketing has been able to generate tremendous brand recall
which would ultimately translate into higher ROI.
Financials
At
the end of the day it is always the bottom line that matters the most and no
matter how great the User Interface or functionality of a site is, if it is not
bringing in a profit it is no good. So how did these two companies perform
w.r.t this all important metric. Let’s take a look. For lack of data (Cleartrip
financial data not available for financial year 2011, 2012), I will compare
just the revenue and Income after Tax of the 2 companies for the financial year
2010.
Company
|
Revenue (USD Million)
|
Income after Tax (USD Million
|
Makemytrip.com*
|
82.41
|
(6.21)
|
Cleartrip.com**
|
12.39
|
1.37
|
A
quick look reveals that Makemytrip ran a loss of $6.21 Million during FY10
whereas Cleartrip earned $1.37 Million in profits after tax. This was also the
time when interest in the Cleartrip search term reached its peak. Surely some
of the UI effect must have spilled into the company financials as well.
However,
Makemytrip remains the biggest player in this space in India and have continued
to make handsome profits after 2010. In addition the revenue base of makemytrip
is much bigger than cleartrip. From the business perspective Cleartrip can
think about venturing into new travel categories like packaged deals for
international travel. At the moment cleartrip has launched a feature called
“SMALL WORLD” (in the beta phase), which provides travel related information
like destinations, sights, restaurants, entertainment, shopping, hotels, etc.
Social Media Strategy
In a
world where Facebook has become a second life for people, no discussion is
complete without the social media strategy. In this respect, both Makemytrip
and Cleartrip started off on the same note (Facebook was being used in India
only post 2006 – so none of the 2 companies had any advantage over the other).
However, Makemytrip clearly enjoys a larger fan base (because of the wider
product offerings) compared to Cleartrip. However, from a personal experience
Cleartrip has a better social media engagement strategy than Makemytrip. I had
left a thank you message on the Cleartrip Facebook page and had received an
almost immediate reply, which would be really pleasing to any enthusiastic
consumer. I did get a reply from the Makemytrip social team as well – 3 DAYS LATER!!
Region wise interest
On a closing note I have compiled the region wise interest
in cleartrip and makemytrip from Google Insights for Search.
The data seems to suggest that Cleartrip is more popular in
Maharashtra as compared to Makemytrip which is more popular in Karnataka.
Final Words…
I have fashioned most
of this article from “My Point of View”, so a friend of mine asked me what is
the general opinion about user friendliness of a website among people in
general. From what I understand, user
friendliness is a feature that Indian consumers are still willing to compromise
on as long as they are already familiar with a site (similar to my story of
transition from Makemytrip to Cleartrip). In addition given the fact that
Cleartrip started during 2005-06 almost
half a decade after Makemytrip, I was sure that Makemytrip was going to
beat Cleartrip usage in any consumer survey. Nonetheless, I decided to collect
data from Facebook friends through a survey to find out which among Makemytrip
and Cleartrip is their online travel agency of choice.
Here
are the results:
Clearly Makemytrip is the choice of the majority (46%), with Cleartrip
managing around 19% votes. While this might be discouraging to look at, but
given the context, we can surely see a silver lining to the cloud.
The
image below shows the Alexa rankings of both the websites. Clearly Makemytrip.com is
way ahead of Cleartrip.com in terms of usage, and hence can be expected to have
more customers following.
Compete.com paints a similar picture (data
pertaining to US only)
What all this data means is that Makemytrip got a head start of 6 years
and has built up a considerable lead. However, Cleartrip has managed to get 19%
of the market (from the Facebook Survey) within the last 4-5 years- which is
encouraging and also bears testimony to the better design of the site.
I am sure 6 years down the line; we will have a major shift in all
these data points.
