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ISSN: 2347-2723
Impact Factor : 3.3754(UIF)
Volume - 5 | Issue - 8 | March - 2018

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ONLINE BUS BOOKING SERVICE IN INDIA: A STUDY ON REDBUS COMPANY

Dr. Ramakrishna Bandaru

Dr. S. Radhakrishnan Post Doctoral Fellow (UGC), Department of Commerce,
Osmania University, Hyderabad, Telangana.

ABSTRACT
The bus travel industry is not recognised as one of the
commercial industries in India. Past half decade, many changes have
been taking place into this field. Online bus ticketing or e-ticketing is one
of the major innovations in the bus travel industry. Many new companies
have emerged in the online bus ticketing sector. redBus is India’s largest
online bus ticketing company. redBus has revolutionized bus ticketing
industry in India. redBus sells seats directly to the customers/passengers
via its website. The company has about 75000 point of sale outlets all
over the country. The present study is aimed to identify the online bus
ticketing industry scenario in the country along with highlighting the
redBus Company. It is also aimed to study the passengers’ perception towards redBus service. The samples
are drawn from the Hyderabad city using convenience sampling technique. As per the results, ‘Availability of
seats’ is a key a motivating factor towards redBus service and there is a co-relation between income level of
the passengers and the use of online booking services.

KEYWORDS: Online Bus Ticketing, redBus Company, passenger, motivating factors.

INTRODUCTION
Booking of bus tickets in India is quite simple in these days. Just a few clicks on the internet through
mobile are enough to purchase the bus tickets. redBus is India’s largest online bus ticketing company.
redBus has revolutionized bus ticketing industry in India. redBus sells seats directly to the
customers/passengers via its website. The company has about 75000 point of sale outlets all over the
country. The company has launched in August 2006 with two bus operators and a daily inventory of 10 seats
covering two routes. It has a network more than 700 operators and a daily inventory of 500000 seats across
2500 cities in 15 states in India. redBus also offers the added convenience of home ticket delivery and even
accepts payment against delivery. redBus provides bus travellers, the most uncomplicated and hassle-free
booking experience ever. redBus is an online platform that allows users to book for bus tickets. redBus is a
private company and which is a subsidiary company ibibo web pvt. Ltd. since June 2013. redBus’s latest
funding round was a series C for $ 6.5 million on may 2011. Phanindra who is a CEO & his team scaled redBus
to a level where its revenue is above $12 million. Presently, it is considered to be one of the fastest growing
Indian web start-up

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ONLINE BUS BOOKING SERVICE IN INDIA: A STUDY ON REDBUS COMPANY Volume - 5 | Issue - 8 | March - 2018
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INDIAN BUS TRAVEL INDUSTY
The bus travel industry in India is unorganized and highly fragmented. It is a 1201 billion annual
turnover industry with a growth rate of 25% per year. This industry is growing phenomenally in India, being
one of the most preferred modes of transport for millions of Indians. There are around 2000 private bus
operators which function with almost 20000 buses on point to point routes. In the Indian bus travel industry,
most of the private players were regional players and did not have a pan India presence and therefore there
was a lack of a centralized platform for organized scale of operations. The market for online car rentals and
bus reservations business was anticipated to arrive at $150 million in the year 2011 as per Applied Travel
Intelligence. The two carriage categories when it comes to Indian bus travel industry operations are contract
carriages and stage carriages. The contract carriages are usually long distances from city to city with less
number of stop points whereas stage carriers are comparatively short distances with several stop points. The
contract carriage industry in India is fragmented, with more than 65% of the bus operators possessing over
less than 20 buses each. Despite of growth of online ticket reservations in India through renowned players
like makemytrip.com (airline) and IRCTC.com (train), there was a reasonably slow growth when it came to
online bus reservations. The role of IT in revenue management is prominently discussed by many
researchers. The reasons for this slow growth could be attributed to several reasons like the unwillingness of
the majority of the Indian population to book their bus tickets online, low internet penetration and more
than that, the unavailability of a proper online platform to book their bus tickets.

REVIEW OF LITERATURE
Dr. Chaya Bagrecha and Sadiq Alam (2015)1 the authors suggested that the online booking
companies have to provide the service should be provided as per the desire of the passengers and the
companies have to maintain the secrecy in respect of passengers personnel information. It is also suggested
that the refund must be done as per the period mentioned on the websites. Sujo Thomas, Bharthi Pathak
(2014)2 the author concluded that redbus has a volume driven business and it plans to expand further into
the Indian market by opening regional offices to serve the customers better. The current strategy followed
by redbus is to aggregate bus tickets by any means close at hand and later delivering to the consumers
through any channel that is accessible by them. redbus has to put forward a growth model in existence
which would provide a sustainable growth in the long term. redBus owners have a challenge that
maintaining strong relationship with bus operators and gaining the trust of new operators/agents was a
challenge right from the inception. R. Ramya (2015)3 undertook the project entitled “customer satisfaction
on online bus ticket booking” with an objective to analyze and evaluate the level of customer satisfaction.
The main aim of this study was to find out the level of customer satisfaction towards online reservation of
bus tickets. The sample size is of 110 respondents. The study revealed that socio-economic factors like age,
educational qualification, occupation, monthly income earnings of the family have direct impact on the level
of customer satisfaction of the customers in relation to online reservation of bus tickets. Sulaiman, A., Ng, J.,
&Mohezar, S.(2008)4 in their research paper entitled “E-ticketing as a new way of buying tickets” try to focus
on the motivational factors that influence online buying. According to I.A.M.A.I., India has a big pool of
techno savvy population that is not only browsing the internet but also purchasing products that are
available online. Using internet as a medium to attract the customers and sell products or services is the
basic concept of online marketing. This paper theoretically attempts to connect critical motivational factors
that influence online buying. It was found in the study that the motivational factors do not have significant
difference between men and women.

1
“The Growth of Online Bus Ticketing Industry: redBus Route to Success in the Indian Market”, International Journal of
Business and Management; Vol. 9, No. 11; 2014.
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ONLINE BUS BOOKING SERVICE IN INDIA: A STUDY ON REDBUS COMPANY Volume - 5 | Issue - 8 | March - 2018
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NEED FOR THE STUDY
Online bus ticketing or e-ticketing is one of the major innovations in the bus travel industry. Past two
years, many new companies have been emerging into the online bus ticketing sector. redbus is India’s
largest online bus ticketing company. redbus has revolutionized bus ticketing industry in India. redBus sells
seats directly to the customers/passengers via its website. The company has about 75000 point of sale
outlets all over the country. Therefore there is a need to identify the passenger’s perception towards online
bus ticketing service provided by redBus Company and it should be an aid to the redBus company for the
acceleration of the present service.

SCOPE OF THE STUDY

The scope of the present study is restricted to overview the Indian bus travel industry. It also
extended to identify the passengers perception towards redBus online bus booking service and the samples
are drawn from Hyderabad city only.

OBJECTIVS OF THE STUDY

 To study the bus travel industry scenario in India.
 To study the demographic profile of the redBus customers
 To identify the customers perception towards redBus online bus booking service.

HYPOTHESES
 H01: There is no significant mean difference between distance of Journey and use of online booking
through redBus.
 H02: There is no co-relation difference between income of the customers and use of online booking
through redBus.
 H03: There is no significant mean difference between male and female in respect of satisfaction on
redBus overall services.

RESEARCH METHODOLOGY
The present study is based on both primary and secondary data. The secondary data is collected
from various published journals and the official website of redBus company whereas the primary data is
collected directly from the passengers who booked the bus tickets through redBus.in. The primary data is
collected by structured closed ended questionnaire form the passengers who opted the pickup point in LB
Nagar bus stop in Hyderabad city, Telangana state. As unknown population, the study used ‘convenience
sampling’ technique to select the sample respondents and the sample size is 100 passengers. The primary
data has tested using various statistical tools like mean, standard deviation, T test, ANOVA, Garrett Ranking
method and Co-relation to get the results in a scientific way.

DATA ANALYSIS
A. Demographic Profile of the respondents
Table-1 shows the demographic results of the selects respondents who used the ‘redbus’ online
booking service from Hyderabad city to various places. It is observed that male passengers were 62% and
38% female passengers. Majority of the passengers were comes under the age group of 21-30 years (51%)
followed by 31-40 years (35%). It is observed that almost all the ‘redBus’ customers were the educated with
graduation and post graduation qualification.

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ONLINE BUS BOOKING SERVICE IN INDIA: A STUDY ON REDBUS COMPANY Volume - 5 | Issue - 8 | March - 2018
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Table 1: Demographic Results
Variable Category Frequency Percentage (%)
Male 62 62 %
Gender Female 38 38 %
Total 100 100
Up to 20 years 06 6%
21-30 years 51 51%
31-40 years 35 35%
Age
41-50 years 6 6%
51-60 years 2 2%
Total 100 100.0%
Un Educated 0 0%
th
Below 10 class 0 0%
Intermediate 4 4%
Education
Graduation 47 47%
Post Graduation 49 49%
Total 100 100.0%
Software/Private job 55 55%
Teacher/Lower 2 2%
Government job 6 6%
Occupation
Business 10 10%
Other 27 27%%
Total 100 100.0%
Up to 20000 pm 8 8%
Rs.21000-31000 42 42%
Rs.31000-40000 41 41%
Income
Rs.41000-50000 8 8%
Above Rs. 50000 1 1%
Total 100 100.0%
Married 59 59%
Marital Status Un married 41 41%
Total 100 100.0%
Family 62 62%
Friends 8 8%
Accompanying persons Individual 21 21%
Others 9 9%
Total 100 100.0%
Up to 100 km 0 0%
101-200 km 21 34%
Distance of Journey 201-300 km 38 38%
More than 300 km 41 41%
Total 100 100%
Source: Primary Data

 It is identified that majority of the redBus customers were ‘software/private’ 55% job holders employed
in Hyderabad city followed by ‘others’ (27%). The other category includes students, house wife, etc.

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ONLINE BUS BOOKING SERVICE IN INDIA: A STUDY ON REDBUS COMPANY Volume - 5 | Issue - 8 | March - 2018
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 It is observed that majority of the redBus customers were middle and upper middle class persons with
Rs. 20000-40000 per month income (83%).
 It is observed that out of 100 respondents, 59% male respondents whereas 41% female respondents.
 It is observed that the passengers who want to travel with family (62%) used the redBus online booking
service.
 It is also observed that the passengers whose journey distance is high, they preferred redBus online
booking service.
 It is identified that majority of the passengers were preferred to travel along with their family (62%).

B. Motivating factor towards redBus

The study used the Garrett Ranking method to give the ranks for the identified motivating factors.
The method is based on the following formula.

Percent position = 100 (Rij - 0.5)

Nj
Where
Rij = Rank given for the ith variable by jth respondents
Nj = Number of variable ranked by jth respondents
Table-2 narrates the customers motivating factor towards redBus online booking service. It is found
that the ‘Seats Availability’ is the major motivating factor among the customers. It is identified that the
redBus customers were preferred the online booking because of the company providing more seats
available to the customers. According to the results, ‘availability of seats’ is given 1nd rank followed by
‘availability of more operators’ 2rd rank, ‘easy process’ 3th rank, ‘comparison’ 4th rank, ‘discount’ 5th rank and
‘free booking’ is 6th rank. Therefore it is concluded that customers are making the online line bookings for
the availability of seats.

Table 2: Motivating Factor towards “redBus” Online Booking Service

Motivating Total
Factor I II III IV V VI Score N Mean Rank
Free Booking 154 256 605 966 777 943 3701 100 37.01 6th
Easy Process 2156 512 440 966 407 552 5033 100 50.33 3rd
More Operators 2079 1600 990 506 629 46 5850 100 58.5 2nd
Comparison of
Price & Ratings 847 1088 770 966 592 483 4746 100 47.46 4th
Discount by
Operators 1617 896 45 1104 29 322 4013 100 40.13 5th

Seats Availability 6006 128 605 414 0 0 7153 100 71.53 1st
Source: Primary Data

C. Distance and Use of online Booking

Table-3 depicts the significant mean difference between the distance of Journey and use of online
booking through redBus. The formulated hypothesis and the results of the ‘ANOVA’ test are given below.

H01: There is no significant mean difference between distance of the Journey and use of online booking
through redBus.
Based on the nature of the data, the study used ANOVA test. According to the results, the calculated
p value is 0.000 which is less than the standard value 0.05 at 5% level of significant. Hence, the null

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ONLINE BUS BOOKING SERVICE IN INDIA: A STUDY ON REDBUS COMPANY Volume - 5 | Issue - 8 | March - 2018
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hypothesis is rejected and it is concluded that there is a significant mean difference between distance of the
Journey and online booking through redBus.

Table 3: ANOVA
Sum of Squares Df Mean Square F Sig.
Between Groups 104.501 3 34.834 33.950 .000
Within Groups 98.499 96 1.026
Total 203.000 99
Source: Primary Data

D. Income and Use of online Booking

Table-4 shows the co-relation between the customer’s income levels and use of online booking service.
The formulated hypothesis and its results are given below.

H02: There is no co-relation difference between income of the customers and use of online booking through
redBus.
Based on the nature of the data, the study used Co-relation test. According to the results, the
calculated p value is 0.000 which is less than the standard value 0.01. Hence, the null hypothesis is rejected
and it is concluded that there is a positive co-relation between income of the customers and use of online
booking service.
Table 4: Correlations
Online booking
Income
through redBus
Pearson
1 .412**
Correlation
Income
Sig. (2-tailed) .000
N 100 100
Pearson
.412** 1
Online booking through Correlation
redBus Sig. (2-tailed) .000
N 100 100
**. Correlation is significant at the 0.01 level (2-tailed).
Source: Primary Data

E. Satisfaction on overall service of redBus services

Table 5 and 6 show the significant mean difference between male and female in respect of
satisfaction on redBus overall services. The formulated hypothesis and its results are given below.

H03: There is no significant mean difference between male and female respondents in respect of satisfaction
on redBus overall services.
Based on the nature of the data, the study used Independent Sample ‘t’ test. According to the
results, the calculated p value is 0.02 which is less than the standard value 0.05 at 5% level of significant.
Hence, the null hypothesis is rejected and it is concluded that there is a significant mean difference between
male and female customers in respect of satisfaction level on overall service of redBus.

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Table 5
Gender N Mean Std. Deviation Std. Error Mean
Mal 46 1.8261 1.28762 .18985
Overall Satisfaction
Female 54 2.5556 1.05806 .14398
Source: Primary Data

Table 6: Independent sample t-test

Sig. (2- Mean Std. Error

F Sig. T Df.
tailed) Difference Difference
Equal variances
4.797 .031 -3.110 98 .002 .72947 .23457
assumed
Equal variances not assumed -3.061 87.169 .003 .72947 .23457
Source: Primary Data

FINDINGS, CONCLUSIONS AND SUGGESTIONS

 The study found that the ‘availability of seats’ is given 1nd rank followed by ‘availability of more
operators’ 2rd rank, ‘easy process’ 3th rank, ‘comparison’ 4th rank, ‘discount’ 5th rank and ‘free booking’ is
6th rank. Therefore it is concluded that customers are making the online line bookings for the availability
of seats. Hence, it is suggested that the online booking companies have to focus on available of more
seats.
 The study identified that that there is a significant mean difference between distance of the journey and
online booking through redBus. The passengers whose journey is below 100 km were not interested to
book the online tickets. Therefore it is concluded that the more distance of journey is affecting the
online ticket booking.
 The study found that there is a significant co-relation between the passenger’s income and booking of
ticket through online. It is concluded that the passengers whose income is high, preferred the online
booking.
 The study identified that there is a significant mean difference between male and female respondents in
respect of satisfaction on redBus overall services. It is concluded that female respondents were more
satisfied than male respondents. Therefore it is suggested that the company has to move fast in respect
of refund of cancelled tickets among male respondents.

REFERENCES
 Dr. Chaya Bagrecha and Sadiq Alam, “challenges and opportunities in online reservations” International
Journal of management and engineering, online journal, 2015.
 Sujo Thomas, Bharthi Pathak, ‘The Growth of Online Bus Ticketing Industry: RedBus Route to Success in
the Indian Market’, International Journal of Business and Management; Vol. 9, No. 11; 2014, ISSN 1833-
3850.
 Dr. Chaya Bagrecha1, Sadiq Alam “Challenges and Opportunities in Online Reservation of Bus Tickets”
IOSR Journal of Business and Management (IOSR-JBM), e-ISSN: 2278-487X, p-ISSN: 2319-7668. Volume
18, Issue 6 .Ver. IV (Jun. 2016), PP 32-38.
 Sulaiman, A., Ng, J., &Mohezar, S. (2008). E-ticketing as a new way of buying tickets: Malaysian
perceptions. Journal of Social Science, 17(2), 149-157.
 Ramya, R. Customer satisfaction on online bus ticket booking.
 Vyas, P. (2014). The growth of online bus ticketing industry: redBus route to success in the Indian
market. International Journal of Business and Management, 9(11).

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 Devaraj, S., & Kohli, R. (2003). Performance impacts of information technology: is actual usage the
missing link? Management Science, 49(3), 273-289.
 Evans, P. B., & Wurster, T. S. (1997). Strategy and the new economics of information. Harvard Business
Review, 75(5), 70-82.
 Eisenhardt, K. M. (1989). Building theories from case-study research. Academy of Management Review,
14(4), 532-550.
 Cronin, J. J., & Taylor, S. A. (1992). Measuring service quality: A re-examination and extension. Journal of
Marketing, 56(3), 56-68.

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