Cleartrip checks in for a holiday-powered growth trip

Cleartrip, a Flipkart-owned company, is betting on its newly launched holiday packages business to improve the economics of its travel platform. The company is positioning holidays as a higher-margin category that can significantly increase the value generated from each existing customer.

Speaking during an interaction, Gaurav Patwari, Chief Business Officer at Cleartrip, said the company sees holidays as a “very high-margin business” and expects the category to become self-sustaining once it reaches a certain scale.

Read More: Cleartrip to challenge Ixigo, MakeMyTrip, to foray into train bookings

The move comes as Cleartrip expands beyond its traditional strength in air travel to offer a broader travel proposition spanning flights, hotels, trains, buses and now holidays. Recently, ixigo also launched ixigo Bharat Darshan, allowing users to book curated spiritual and family holiday packages.

According to Patwari, the objective is to increase the productivity and lifetime value of customers already acquired on the platform.

“The best thing is in this business, once you acquire a customer, how do you increase the productivity of the customer on your platform? That can happen only when you have products like holiday,” Patwari said.

The economics, he said, are driven partly by the significantly higher ticket value of holiday packages compared with standalone travel bookings. “So, the whole equation between the CAC (customer acquisition cost) and the margins from the customer, that changes dramatically once you've scaled up holiday,” he said.

In Case You Missed It: Sri Lanka, Bali, Dubai Top Destinations For Indians This Year Says Cleartrip

Cleartrip also sees a structural advantage in holidays because of its existing relationships with airlines and hotels. Patwari said the company's scale, direct contracts and relationships across the travel ecosystem allow it to negotiate what he described as “very deep value deals”, which can then be used to build holiday itineraries.

Unlike air travel, which Patwari described as a commodity business with limited pricing power, holidays offer greater pricing power because of the complexity and customisation involved in building itineraries, he said.

Cleartrip is entering a market that it estimates is 90% fragmented and dominated by regional players, local tour operators and travel agents. The company is seeking to differentiate its offering through expert-curated, traveller-controlled itineraries that allow customers to modify hotels and activities.

For Cleartrip, the immediate opportunity lies in converting its existing travel traffic into higher-value holiday transactions. Over the longer term, the company aims to make holidays a meaningful contributor to the platform's overall customer economics as the business scales.

With a roughly $20 billion addressable market for holidays and packages, and online travel platforms expanding beyond individual bookings, the category is emerging as another battleground for India's online travel agencies (OTAs). Margins and customer lifetime value are becoming increasingly central to their strategies.