Your browser is currently blocking notification.
Please follow this instruction to subscribe:
X
Notifications are already enabled.
X

Decoding Indonesia’s Travel Sector: Startups That Are Paving The Way

Decoding Indonesia’s Travel Sector: Startups That Are Paving The Way

Decoding the travel startups of Indonesia

With a population of more than 250 Mn and consistent annual gross domestic product (GDP) growth, Indonesia has emerged as Southeast Asia’s trojan horse, as the next big land of opportunity. Akin to other developing nations in Asia, Indonesia has all the right ingredients to be a fast-growing travel market.

With exotic destinations such as the beach town Bali, the country is already a famous travel destination, and its domestic market for travel startups is increasingly fuelled by a flourishing digital economy, improving infrastructure, and rising disposable income and increased capacity to shop among its urban and working-class population.

Factors Promoting The Growth Of Travel Startups In Indonesia

Travel startups act on an attractive market for disruptive entrepreneurs to tap into. Here’s why Indonesia is an exciting market for travel startups: (Source: UN’s World Tourism Organisation)

  1. Inbound tourism in Indonesia is on the rise as per the statistics. From Jan-Oct 2015, it received more than 8 Mn visitors, up 3.38% over the same period in 2014. The Ministry of Tourism projected to cross the 10 Mn visitor mark in 2015, with foreign exchange earnings of $ 11.9 Bn or Rp 163 Tn.
  2. Tourism, which now has its own Ministry, is receiving high-level attention from the government. In 2016, it projected 12 Mn visitors and Rp 172 Tn in earnings.
  3. It is the fifth largest domestic travel market globally. In 2015, an estimated 255.05 Mn trips were made (Rp 224.68 Tn in tourism spending) and this year, 260 Mn trips are projected (223.6 Tn).
  4. Bali alone was visited by 4 Mn tourists in 2015.
  5. The future is bright as per IATA’s latest passenger forecast, released in October 2014, points to Indonesia as among the top five fastest increasing markets in terms of additional passengers. By 2034, the number of new passengers in Indonesia will reach 183 Mn, fourth after China (856 Mn), US (559 Mn) and India (266 Mn).

With more than 1.1 Bn people travelling out of their home country in 2014 alone, there is huge market potential for travel startups. And with the rise of new technological trends, such as smartphones and social media networks, travel startups have proved themselves quickly to satisfy the new age travellers’ needs.

Asia is one of the hottest markets on this trail, with tech hubs like Singapore and Indonesia delivering top travel apps. Recognising Indonesia as a startup epicentre, many new companies have emerged in the travel sector as well. They provide a wide range of online services to both international and domestic travellers. The tourism hub currently has more than 50 travel startups operating in the travel and tourism segment that have collectively raised more than $70 Mn in funding.

Innovative entrepreneurial models and startups like Go-Jek, Orami substantiate the fact that entrepreneurs in Indonesia don’t just copy the model from the startups around the world. They know what their customers need and are quite flexible in creating nuanced models or changing business models to meet local demands.

For eg., Tiket.com, one of the leading OTAs (Online Travel Agency) in Indonesia, was initially an online train ticket booking platform – similar to what RedBus is to buses in India and ThaiTicketMajor is to movie/event ticket in Thailand. Now, it has already expanded its service to offer hotels, flights, and events online.

screen-shot-2016-12-15-at-7-08-06-pm

We, at Inc42, explore the various facets in which travel startups have revolutionised the travel industry of the archipelago and aim to give a holistic idea of what can be expected in future when this booming industry is juxtaposed with innovation and digitisation.

Beginning Of The Journey: Flight Booking/Hotel Booking Startups

Gone are the days when international travel arrangements were a Sudoku puzzle that needed painstaking efforts and uncertain monetary transactions. With the advent of the Internet and consequent digitisation, the first step of the journey are now sorted with a single click. Startups operating in the space have gone the innovative way to ease the process of ticket and hotel reservations, at the same time attempting to provide potential customers with deals and services that entice them.

Traveloka: Founded in 2012, Traveloka is one of the popular travel startups that deals in flight search and booking services. It has become one of the leading flight and hotel booking platforms in Southeast Asia, serving more than 18,000 routes and thousands of hotels in Asia Pacific, as per its official website. Traveloka provides the customers with the cheapest hotel and flight rates every day, without charging any booking fee for all payment methods.

screen-shot-2016-12-15-at-7-15-02-pm

GoIndonesia: In a similar space, operates GoIndonesia. It is an online hotel reservation website with instant booking confirmations. GoIndonesia guarantees that the room a user has selected will be available even when you book it during high season because of its real-time booking management, which connects with the systems at each of its partnering hotels. In addition, when individuals, travel agents, companies, or government departments are registering as GoIndonesia members, they can access the hotel’s special promotional offers online, including Hot Deal, Last Minute, Early Bird, Minimum Stay and Bonus Nights specials.

Tiket.com: As an award winning startup, Tiket has proven its position in Indonesia as a trusted online booking website for hotels, flights, and trains. It collaborates with almost 1,000 hotels across Indonesia and also nine of Indonesia’s flight companies, which serve both domestic and international flights. Tiket is also the only other web portal where users can buy train tickets besides the official website issued by the Government.

PegiPegi: PegiPegi, an online hotel and flight booking service also works in this space. To attract customers, PegiPegi has Promo of the Week and Early Bird Promo specials with discounts at some hotels in Bali, Jakarta, Surabaya, and Bandung. Additionally, BCA credit card users can pay the hotel bill with a zero-percent-interest instalment plan (three months or six months), and CIMB Niaga users can get a discount up to 60% by paying using CIMB click.

What To Do Once You Arrive: Ease-Of-Travel Startups in Indonesia

Just like no two individuals have similar tastes, people visit a country with varying expectations and agendas. Being an ill-informed tourist does not allow the opportunity to discover everything the country has to offer. It is this pain point that these innovative startups are problem-solving Providing travellers with the right information, choice, and assistance while travelling in the country, cements their demand and ultimately ensures good revenues for them.

NIDA Rooms: NIDA Rooms is a startup that is focussed on transforming inconsistent budget hotels into a consistent customer experience. It provides budget hotels across many Southeast Asian countries. It partners with hotels and issues a standardised branding and service guidelines for the rooms sold via its platform through mobile/web.

Bobobobo: Bobobobo is a luxury ecommerce service that offers choices of trip packages such as Indonesian Underwater Utopia to Gili Island or South Lombok, and Up in the Air packages, where users can head to Bhutan, Nepal, or India.

screen-shot-2016-12-15-at-7-19-26-pm

Gonla: Gonla is an online hotel booking service that covers only hotels in Indonesia, especially in the Jakarta and Bali areas. Gonlahas “Go Experience” features to read from travel guides, and travel stories written by travellers and travel journalists. Another unique feature that Gonla offers is its Best Price Guarantee service. The company guarantees that you will get the lowest price for hotel booking compared to the competitors’ websites; if you find a cheaper price on another website after you make a booking on Gonla, it will meet or beat that price.

Valadoo: Valadoo is another startup that is famous for its tour package offerings, which cover 27 provinces in Indonesia and eight other countries: US, Malaysia, Singapore, South Korea, Thailand, Vietnam, Hong Kong, and Taiwan. Travellers can choose any kind of travel package they want, including beach and island, art and culture, sport and adventure, and photography.

Valadoo has been working with MalesBanget.com to make journey episodes in order to introduce people to unique travelling destinations (caves, mountains, villages, etc) in Bandung, Yogyakarta, and Sumatra. It also has a travel blog on its website, called Jelajah. Valadoo is also collaborating with CIMB Niaga, an Indonesian local bank so that every payment transaction on the site using CIMB clicks will get users a price cut of IDR 500,000 ($48).

Burufly: Another startup, Burufly focusses on domestic tour packages and online hotel booking service. The tour package descriptions give users insights about why you are going to love it and what you are going to do on the trip.

Exploring The Unexplored: The Niche Startups

Sometimes entrepreneurship is all about innovation. Understanding a need and then creating a product/service that solves the lack of it. There are startups in Indonesia that are exploring this segment and addressing special needs with their platforms.

screen-shot-2016-12-15-at-7-23-51-pm

Tripves: Launched by Jati Adrianto and Tamir Tsogbayar in 2015, Tripves is a peer-to-peer car-sharing marketplace. Travellers can rent cars through it. The users have the option to select cars and drivers based on real photos and detailed information. Being a multi-purpose website, it allows people to list their cars for renting purpose and obtain monetary benefits. Furthermore, users of Tripves can list themselves as drivers on the website to earn a substantial amount of money later.

Travelcar: Founded by Amar Alpabet, Agung Firdaus and Nur Hidayat in 2013, Travelcar is an online platform to help air travellers find the best-rated shuttle service to/from airports as well as city-to-city travelling in Indonesia. The website lists innumerable vendors to assist travellers to find the best deals. The users can compare the different offers available on the platform with absolute ease.

screen-shot-2016-12-15-at-7-26-01-pm

Sevva: Sevva is a startup that functions as an online marketplace that allows its registered users to facilitate transactions on a rental basis with other users. It acts as a mediator/connector between people who need to rent and people who want to use items on a rental basis.

screen-shot-2016-12-15-at-7-28-51-pm

LadyJek: Launched by Brian Mulyadi last year, LadyJek is a motorcycle ride-hailing service exclusively for women and by women. Female travellers can easily order a bike ride through its Android mobile application. Focussing on the safety of women, LadyJek was deemed necessary and launched in the Indonesian market. The service offers ETA information, distance and price, for user convenience. The tariff set is Rp 25,000 (US$1.86) for the first six kilometres and IDR 4,000 ($0.30) for each kilometre thereafter.

Pikavia: Founded by Andika Prasetya and Hanifaz Azhar last year, Pikavia can be used to find tours easily, connect with trippers and share their travel experiences.  Often called as the ‘Airbnb for tours’, currently, it has 385+ tour packages listed on the website. It has an interesting ‘Custom Trip’ feature through which travellers can share details of their dream trip. The mentioned details will be communicated to 50 tour agents for free. Consequently, interested tour agents can contact the users to help them realise their dreams.

screen-shot-2016-12-15-at-7-27-19-pm

Logbook: Launched by Muhammad Syirazi and Dhana Bisma in 2013, Logbook is a social platform for discovering and sharing personalised travel recommendations. Users can find out about new and hottest destinations and share stories of the journeys. They can even exchange information and tips for the best experiences. Presently, it is known as the biggest mobile travel community in Indonesia.

YesBoss: Founded by Irzan Raditya, Muhammad Reynir Fauzan, Christian Franke, and Wahyu Wrehasnaya last year, YesBoss is an SMS-based personal virtual assistant that can be used by travellers visiting Indonesia. Trippers can use this service to deliver a bouquet of flowers, order food, make hotel reservations and book flights without the use of the internet. YesBoss is absolutely free of cost which makes it a useful tool for travellers.

Entrepreneurship And Administration: Government’s Support

With an aim to boost the travel industry of the country and to give a push to the startup ecosystem, Indonesia’s Ministry of Tourism launched an online marketplace for travel and tourism services in October this year.

According to a report by Bisnis Indonesia, the platform — called Travel Exchange Indonesia (TXI) — will connect potential customers with online travel agencies (OTAs) and conventional travel agencies to purchase services and products such as airline tickets, hotel bookings, car rentals, and tour packages, among others.

With this move, the government aims to digitalise conventional travel agencies, most of which are run by small and medium enterprises (SMEs), in order to empower them to compete in the digital era. To further facilitate this goal, the ministry has secured partnerships with travel tech startups such as Traveloka, Alitrip, and C-Trip; search engine companies such as Google and Baidu; and travel review platform Tripadvisor.

The initiative is aimed at promoting Indonesia’s travel and tourism industry to its core target markets, consisting of Singapore, China, Malaysia, Australia, Japan, and Korea.

Editor’s Note

Indonesia’s travel market has plenty of upsides, but it faces macroeconomic challenges that threaten to drag down growth. It emerged out as the second fastest-growing Asian economy after China in 2013. But the effects of a rising current account deficit, devaluation of the rupiah and inflation have reined in the once enthusiastic outlook for the market.

Travel in Indonesia is headed for a reboot. Consolidation is taking place on the world stage and as the giants scale further, can local online players hold their ground? Traditional travel companies, which have held sway in Indonesia, are embracing digital in a big way and investing heavily. How quickly will they fend off the existing online players? And, a key question, can Indonesian online travel brands expand beyond its shores?

Indonesia’s hotel market is fragmented and diverse, fertile pickings for intermediaries and major technology providers all looking to crack this independent market. Distribution and marketing is being upended by technology and hoteliers have to reboot their thinking and strategies to drive revenues, enhance profits and win loyalty.

Startups are also changing the game and as Indonesia’s travel startup ecosystem matures, the industry needs to embrace these new players for the opportunities they could open up to new consumers.

Author

Ambika Chopra

Inc42 Staff

An ace feminist and humanitarian, Ambika identifies herself as a reader, writer and a dreamer. Also a literature buff and development enthusiast. At Inc42 she aims to explore the startup ecosystem with ideas that juxtapose digital culture with social responsibility.

Responses
https://inc42.com/entrepreneurship/funding-101-woo-investor/
Loading Next…

Upcoming Events