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Transcript of CASE STUDY
OYO Rooms is a branded network of hotels in India. Oyo Rooms is the ‘oldest startup’ in the space which was started as Oravel in 2011 by the then 18-year-old Ritesh Agarwal. OYO Rooms currently operates in more than 120 Indian cities including Delhi, Gurgaon, Jaipur, Mumbai and others. OYO is present in major metros, regional hubs, leisure destinations and pilgrimage towns. The company is backed by investors like the Softbank Group, Greenoaks Capital, Sequoia Capital and Lightspeed India.
WHERE OYO IS HEADING :
OYO Rooms provides standardized hotel rooms with features such as an air-conditioned room, complimentary breakfast and Wi-Fi with 24x7 customer service support. Guests can use the OYO Rooms App for booking rooms on the go. They can also order beverages and request room service through the app. Hotel owners who partner with OYO Rooms are connected via world’s first tablet based property management App and become part of the OYO brand.
The Growth Story
From a single hotel in May 2013 to over 3000+ hotels at present,
has been an inspiring journey from a smart idea to India's largest branded network of hotels with the dream of becoming the world's largest branded network of hotels.
Using Social Media as a medium
Traditionally, Oyo has been spending its advertising dollars on the digital domain and has been yielding good results from it. It has a Facebook presence of over 2.7 lakh fans and a Twitter following of over 8,000 followers. The brand claims to have over 1.5 million app downloads with a good number of active users.
Using short films as a medium
Prior to this campaign, Oyo Rooms devised a strategy of reaching out to people via short videos and films. It created several campaigns such as Jai Hind, Father's Day Celebration, and IPL Final Verbal Combat. Of these, Jai Hind was the most successful one that featured Bollywood actor Manoj Bajpai and Raveena Tandon. The video fetched over 1 million views to the brand. Some of their recent endeavors are A Salute to the heroes of 1965 war and Oyo Explorer - Pune.
Why mass media ?
The reason for taking the mass media route, states the company, is that Oyo Rooms is a mass brand that has born out of digital domain. Sushil points that even though Oyo is a digital brand, it needs to go to masses. "A large part of our audience resides in small towns and is stillnot tech savvy. So mass media is the only route to connect with them," adds Sushil.
Secondly, the brand also wants to establish a relation or at least register in the minds of all age groups (especially elders whose hotel bookings are mostly done by their children) before it becomes a mass brand.
Sushil says, "OYO is in a phase where we are making people more interested in to the category. We devised emotional videos for the online audience but when we decided to go for the mass media we chose humor above everything as it cuts across every age-group. Also, we are a mass brand like Flipkart. And just like Flipkart's, our communication is also for everyone."
As a category creator and leader, the brand has also been facing challenges. Sushil says, "When Oyo began, the biggest challenge was to provide traffic to the associate hotels, because if they did not get the traffic, they would have pulled out and the entire model would have flopped."
With the increasing traction, a bigger challenge of small hotels using Oyo Rooms branding without the brand's permission has surfaced. Oyo Rooms claims to be working in this space.
What Oyo Rooms saw was that there existed the problem of trust deficiency among corporates, single women travellers or women who were traveling to other cities for office work. In most of the cases there was no sense of contentment and OYO wanted to change how this worked. Oyo WE was launched to cater to our female guests who were looking for relaxed and pleasing stays," explains Sinha.
The brand claims that women travelers comprise nearly 40%of OYO Rooms' frequent independent travelers (FIT). Oyo also offers luxury space as it has a service called Oyo Premium where it provides luxury rooms to its customers.
Customers & Consumers
Oyo Rooms claims that its target audience is divided between customers and consumers. Its customer ages between 21 year to 35 year while its consumer is between the age of 16 year and 65 year.
However, Oyo Rooms' consumers are parents, younger brothers/sisters and young professionals. "We have seen that the hotel bookings for parents are mostly done by their children between the age of 21 and 35. So, our campaign is attempting to strike a chord with both parents and children such that when elders also hear about their rooms booked at Oyo, they have a trust attached to them in the mind."
Right Up Front
Speaking on how Oyo Rooms is attempting to tackle such massive competetion, Oyo Rooms did something that was never done before. They entered the Indian hospitality industry and disrupted it with our highly innovative working model. By standardizing the fragmented hotel segment for people we have solved the problem of trust deficiency that existed before us. The entire process of booking hotels and staying out of home was cumbersome. For the first time the consumers had the option of booking a room in just five seconds and ordering rooms service by the touch of their phones through our Oyo app. Other players in the industry create a healthy competitive environment and they are proud that even with such competition they have emerged as market leaders.
Oyo Rooms considers any and every place where a person stays, when not at home, be it a hotel, guesthouse or even a relative's house, as competition. However, they have introduced the concept of standardization and are the pioneers in this market. Oyo work very hard as the market leader and believe in the quality of innovation and focus on customer experience. For them, they themselves are their biggest competitors.
As per several published researches, Indian Hotel industry is expected to estimate around Rs 230 billion by the end of 2015. This is certainly a huge number and an inspiring one. In the aggregation space, Oyo has also inspired several other players to come forward such as Zo Rooms, Treebo, Fab Hotels, Zen Rooms, Go Stays, and many others. It is also competing with the might of MakeMyTrip and Cleartrip who are pioneers in the hotel aggregation space.
The brand is now keen on foraying into an all women space with its new property called 'Oyo We'. It is a first of its kind category that Oyo is trying to create. Why? "Most of the women travellers want their hotel experiences to be comfortable and pleasant.