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Stepped-up tourism development & promotion potentially opening up new growth avenues for OOH

By Neelambari Kakaraparthi - February 19, 2024

States are now incentivised to develop iconic tourist destinations and promote them globally

Following the COVID-19 pandemic, there has been a noticeable change in consumer behaviour, as people are now actively pursuing happiness and prioritising experiences that provide joy and fulfilment. This renewed interest in travel, combined with greater flexibility, offers advertisers significant opportunities to connect with their audience. Hotels, airlines, tourism boards, and transportation providers are looking to leverage OOH advertising to reach potential travellers throughout their journey.

Photo credit: Photo by Tatonomusic, Unsplassh

Whether the objective is to inspire trip bookings, promote local establishments, or enhance brand visibility, OOH advertising stands out as an effective way for advertisers to capitalise on the heightened mobility of consumers.

The travel and tourism sector has witnessed a surge in competition in recent years, driven by the resurgence of both international and domestic travel. According to the report on the Growth of Tourism and Hospitality Industry by IBEF, travel and tourism are among the largest industries in India, collectively contributing approximately US$178 billion to the nation's GDP. 

India's extensive coastline is adorned with numerous picturesque beaches, further enhancing its appeal as a travel destination. Projections indicate that the travel market in India is poised to reach US$125 billion by the financial year 2027, with international tourist arrivals expected to reach 30.5 million by 2028. Advertising at airports proves highly effective in reaching decision-makers, as it attracts the attention of 75% of business frequent fliers who actively engage with the ads. These optimistic statistics indicate that the OOH industry is poised to experience increased business opportunities.

In recent times, Prime Minister Narendra Modi has been actively championing India's potential as a premier tourism destination. The recent initiative in Ayodhya now featuring an airport, modern railway station, and improved road network, is positioned to accommodate over 50 million tourists annually. Determined efforts like these align seamlessly with the government's vision for the tourism sector, underscored by Union Finance Minister Nirmala Sitharaman's decision to increase the budget allocation for FY25 to Rs 2,449.62 crore. 

Finance Minister Sitharaman proposed to enhance infrastructure and port connectivity in India's islands like Lakshadweep to meet the increasing demand in domestic tourism. This initiative aims to generate employment opportunities by improving port connectivity, tourism infrastructure, and amenities. States will be incentivised to develop iconic tourist destinations and promote them globally. Additionally, a rating system for tourist centres based on facilities and services will be established. 

The government has allocated Rs 1,750 crore for the Integrated Development of Tourist Circuits, doubling the previous amount. 

Establishing its footing, OOH advertising is becoming increasingly popular among advertisers, particularly in high dwell time locations such as airports and metros. With a surge in consumer willingness to travel, OOH ads present an opportunity for businesses in the travel industry to engage potential travellers and enhance brand visibility. Researches indicate that more than 40% of individuals travel three or more times every six months for business reasons. Among them, 36% of respondents visited a website to learn more about the campaigns they saw in airport advertisements, while 30% downloaded an app related to airport advertising. 

ICRA forecasts record-high overall passenger traffic in India for the next fiscal year, estimating a growth of 14-16% to reach 373-380 million, indicating significant growth in travel demand. In this competitive landscape, OOH advertising emerges as an effective and measurable tool for travel brands to connect with travel-minded consumers throughout their journey. 

Initiatives such as enhanced port connectivity and the Integrated Development of Tourist Circuits demonstrate a concerted effort to capitalize on the sector's growth potential. The surge in OOH advertising further amplifies opportunities for businesses to engage with travellers and enhance brand visibility. With record-high passenger traffic projected and continued investments in infrastructure, the stage is set for India to emerge as a premier global tourism destination, offering unforgettable experiences and opportunities for economic growth.

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