Paytm is growing vertically as well as horizontally – In just last few days they have made number of significant announcements including launch of Virtual China Bazaar, Entry into Hyperlocal Business and introduction of QR Code based Cashless payments.
Now, Paytm is making entry into another fast growing online vertical – Hotel Bookings. Going forward, Paytm will be offering hotel bookings on its platform in partnership with third party players like Goibibo, Ezeego1, Via and TSI-Yatra.
Vijay Shekhar Sharma, Founder and CEO of Paytm told PTI, “Travel has emerged as a very important category for us as the penetration of online booking is still very low in this vertical. The opportunity for the hotels category is immense, especially because the transaction penetration is still low in Tier II and III cities as far as travel concerned.”
Sharma is hopeful that hotel bookings on Paytm will contribute over Rs. 500 crore revenue in the next six months.
Interestingly, Paytm wants to offer international Hotel bookings as well. While in phase 1, only domestic bookings will be offered, in phase 2, they plan to go international in partnership with leading global platforms like Expedia and Booking.com.
As per reports, Paytm will have an inventory of over 20,000 hotels in phase 1 and is expected to rise to 35,000 shortly after launch.
Why is Paytm Spreading Horizontally?
While it may look like horizontal expansion, it is not in the strict sense. Paytm forayed into travel category long time back by introducing online Bus ticket Bookings in 2013. They also offer Metro ticket bookings. While Air/Train Tickets may have been logical move forward, Paytm has skipped it (or it may be launched in future) and started offering Hotel bookings. Probably, Paytm feels latter is more attractive with less competition.
Paytm already gets millions of visitors every month, and offering various online services along with the core recharge/ecommerce will help them extract maximum revenue per visitor. Also, with strong backing from Alibaba, they can aggressively market these services.