"It provides airlines with a value-added product which guarantees increase in revenues especially in the holiday season. Not just the carriers but the hotels and other partners in the package benefit from the package," Amber Dubey, director, aerospace, for global consultancy firm KPMG told IANS.
Dubey's views are corroborated by Air India, whose senior official with the operations arm said around 20 percent of bookings in the holiday season come through the package services.
"Summer season is one of the busiest travel seasons; so there are assured footfalls. Package services do add 20 percent or more bookings for the entire season," the official said.
According to the official, apart from ordinary vacationers, business travellers globally look forward to the 'one-stop' shop concept like 'dial a holiday' and 'web-based' travel and stay plans.
"Air India had identified the potential in these package services long time back. We were in fact the first airline in India to start it. Internationally this is a well- known and successful revenue model for airlines," said the official, adding that Air India started holiday packages in early 2000s.
Vijay Mallya-promoted Kingfisher Airlines was among the first to offer holiday packages this summer season through a membership programme. The packages were launched in collaboration with the airline's alliance partner Royal Caribbean International which is a global cruise lines operator.
"The alliance with Royal Caribbean International is yet another initiative that will expand the range of exciting and exclusive benefits we offer," said Anshu Sarin, vice president, guest loyalty and Kingfisher holidays.
Budget carrier IndiGo Airlines followed up with an exclusive packaged holiday service- 'Get Packing' which allows travellers to book - flights, hotel accommodation, airport transfers in various price ranges.
"It is a simple idea which is perfect for people who want high-quality travel experience at low prices, with minimal wastage of time for booking flights, hotel accommodation among other things," Aditya Ghosh, president of IndiGo, told IANS.
IndiGo said that travellers can now avail themselves of nearly 150 packages in 30 destinations which include a variety of tours like religious, business and leisure.
Hotel chains have also shown interest in joining the package services provided by airlines. Hotel chains like Accor Group, Fortune, Sarovar, The Pride and Lemontree have joined the IndiGo service.
"Hotels and other service providers such as transportation, food and beverages joints benefit by joining a package. This assures them of good business and revenues in the season," KPMG's Dubey said.
International air carriers like Air Arabia have also jumped into the holiday package segment, by offering customised tours for Indian travellers to Kenya.
The Saudi Arabia-based low cost carrier's summer package to Kenya starts at Rs.49,500 and can be availed of from six Indian cities.
According to aviation analysts, over 13 million Indians travelled abroad for business and leisure last year.