RedBus CEO Prakash Sangam
Online bus ticketing platform RedBus
has set its sights on the untapped road transport corporations, which do not have the technology backbone to support online bookings from third-party channels.
Over the next four years, the Bengaluru-headquartered firm is expecting to derive 25 per cent of its revenues from government transport corporations, as compared to 9-10 per cent as of now, said Prakash Sangam, chief executive officer of RedBus.
Despite the online travel booking in the country seeing a huge surge in the past years, the corporations rely heavily on offline ticket booking that accounts for 90 per cent of their business. RedBus, which has tied up with 22 such corporations, is pushing to make further inroad into this segment by offering technology solutions for monitoring of the fleet and passenger safety in addition to the core inventory management platform.
The company plans to engage with the Karnataka
State Road Transport Corporation and the Punjab State Bus Stand Management Company to bring them on its platform. According to Aryaman Tandon, director at Praxis Global Alliance, India’s bus transport market stands at $100 billion. “Players like RedBus
have a significant opportunity at hand not only for booking but many other business opportunities within the road public transportation segment,” he said.
About three years ago, when MakeMyTrip was in talks to merge with the Ibibo Group, the idea was to consolidate operations in the online accommodation booking space.
RedBus, which was part of Ibibo, was also brought on board to be a part of this three-dimensional combined entity as Nasdaq-listed MakeMyTrip saw it as a complimentary product to the travel and hotel bookings space. RedBus, which had higher volume of transactions than the combined MakeMyTrip and Ibibo, was growing 25 per cent year on year. The company’s growth rate is now 40 per cent year on year with compound annual growth rate of 50 per cent for the past two financial years.
“When we were part of Ibibo, the real focus was on growing hotels, but after merger, the combined resource was put to drive growth opportunities in RedBus as well,” said Sangam.
RedBus is looking at providing the road transport corporations with inventory management and ticketing tool that helps them distribute the inventory to booking agents, connect with booking counters, and online platforms. Besides, the company has a GPS-based bus tracking system, YourBus, which helps bus owners and corporations in getting insights on their fleet such as over-speeding alerts, unscheduled halts, route deviation and delays improve their services.
The company, which sells 20 million tickets every quarter and claims to hold 75 per cent of the online bus ticketing market, is rapidly expanding into international markets, especially in South East Asia and Latin America. It is present in five countries — Malaysia, Singapore, Indonesia, Peru, and Columbia. In the near future, it has plans to enter four new markets in these regions. Global markets account for 7 per cent of the company’s overall revenues.
Beyond bus ticketing, RedBus has entered the peer-to-peer carpool service segment through a new product called rPool, which connects car drivers and ride-seekers travelling on the same route.