Diversification of travel platforms into other businesses

Abstract

We have observed that in recent years, many industries have become platform battlegrounds. By platform we mean that the companies have product/service provided by one entity along with complements provided by a variety of other companies. Here a platform leader is the one which emerges and works with the companies that supply complementary products and services. These are the two-sided markets. Popular examples are Google (which links advertisers and Web searchers and serve both), Flipkart (which brings together buyers and sellers) and others. Now there are popular travel platforms like MakeMyTrip, ClearTrip, GoIbibo and even single party platforms like IRCTC which are indulging in adding products and services to their core businesses which they deem as complementary. There are two broad categories of strategies that companies adopt while doing this: (a) Coring: Creating an all new platform where one has not existed before using their already existing customer base (b) Tipping: Entering into already existing businesses using their existing customer base What the companies like MakeMyTrip, ClearTrip, GoIbibo and IRCTC are doing is entering into businesses that are already established and are successful. For example, they are indulging into hotel business, local travel assistance, activities among others. Through this project we wish to analyze why these travel platforms are diversifying into these businesses which already are dominated by other market players. We first try to understand few necessary concepts and in parallel quote few examples that helped us understand the application of concept in real time.