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OYO Rooms

“On your Own” and a young 17 year old. Make the connection? Ah, yes a yet-not-an-adult on his own, making it big all on his own!

The story of Bed & Breakfast has been raging the popularity charts for a decade now at least. India was well adjusting to its many benefits, albeit a few hurdles. The availabilities were limited, not every place of your choice would have one to your taste and budgets often were quite over the roof.

When Ritesh Agarwal, all of 17, with an experience of travelling through India, decided that every traveller deserves a great stay, he first began Oravel stays in 2011, a combo of technology with hospitality, bringing together guest houses and vacation rentals across India. Soon he realised that India could well do without yet another such platform and thus OYO Rooms was born in 2013.

So what was Oyo Hotels & Homes? “A virtual hospitality brand with aggregated economy hotels and guesthouses across India that could be found and booked online.”

To Marketing geeks, we look at defining words and try and assess the success behind the thought, the ideas.

Awareness – AirBNB had already done the work of spreading awareness of a “home away from home”. Don’t miss the home comfort while you enjoy your vacation or work-stay.
Inquisitiveness – How does one pull Indians to a concept as this, with a varied population of travellers across all SEC’s? Simple. You serve as an aggregator, bringing together on one platform rooms across all rates. Catering to all through one unified platform.
Desire – The means were there. More than tens of thousands to choose from. Comfort of online bookings. Hence desire could not have been far behind.

A look at young Ritesh’s journey teaches one a lot. He got a seat at Thiel Fellowship, a two-year program from PayPal co-founder Peter Thiel, which grants 20 teenage entrepreneurs $100,000 and the mentorship of trailblazers like Facebook’s Mark Zuckerberg and SpaceX’s Elon Musk. And what were his key learnings at the end of this fellowship?
Lesson#1: “Think big and don’t be afraid to innovate”.

The rest was a lesson in intelligent thinking, strong partnerships and robust expansions. Early on in 2013, Ritesh hit the success button and how! He managed a hotel with rather low occupancy in Gurgaon and rebranded it as OYO. Changes followed, the key being maximising its appeal for budget travellers. In its very first month, occupancy climbed from 19% to 90%. Their gratitude would be repetitive.
Lesson#2: Appeal to budget travellers. Offer them maximum style and comfort. Wow them.

Benefits of chic and style were mostly the domain of premium travellers. This needed change. Ritesh realised that why just in India, but worldwide, budget hotels having less than 100 or 150 rooms were seldom spruced up to offer more. These were intimate, more home-like and budget friendly, thereby attractive to many. So how does one convert these into more value-add, more appealing places? Simple.
Interiors – Do up classy interiors – enhance the face value
Operations – Optimise operations – make hotels more efficient
Dynamic pricing – Pay as per convenience/service

More satisfied guests with better experience
Better revenue for hotels
Lesson#3: Strike a balance – quality, location & price

Commons sense, right?

Well, just another common sense perspective. Consumer Ratings. Happy consumers bring more consumers. Harp on ratings. Build on satisfaction. Could Marketing get any simpler?
Well, there was more to common sense approach. What would you do if you were to replicate your own experience and make it better? Learn from the flaws, correct them, better them. Ritesh did no different. His experience of a traveller taught him about basic needs of a guest e.g. warm white light for breakfast (don’t break a leg on that expensive chandelier), entertainment light, clean washrooms…
Lesson#4: “Elementary, my dear Watson!”

Keeping both ends happy is a simple way of ensuring that a break in partnership doesn’t occur. While consumers continue to pay budget-friendly rates and avail of style and chic, hitherto absent, hotel owners get funds support to upscale, a predictive yield guarantee and improved customer ratings.

Who better than customers to be the best teachers? Ritesh studied the top-5 stay options which customers mostly booked. Pulling up the socks for option number 6 onwards was therefore easy. He studied the key likings and reasons for choosing the top 5 options. Implementing the same and pulling up the others through the rank wasn’t so tough!
Lesson#5: Open your eyes to the reasons your customers give you. In words and in action.

One simple aspect to incentivising hotel employees for better productivity is to monitor their performance against time. For example, if a housekeeping person cleans a room better and faster and the same is evident through a performance app and customer feedback, this employee can earn upto 25% more. This not just reduces manpower need and therefore save management cost, but also engages more productive employees.
Lesson#6: Incentivise employees to work more effectively and get paid more.

Round the clock monitoring through effective app is a no-brainer in today’s businesses. The same goes for OYO. “Back-of-house tech also extends to each asset’s staff. For example, the brand has a dedicated app that lets housekeepers know what rooms need to be serviced, lets management know how much time the housekeeper spent cleaning the room—and how clean the guest has reported the room to be.”
Lesson#7: Engage technology for better efficacy

Cut to 2020 and the pandemic. Yes, much as OYO, being a part of the Travel & Tourism sector, stumbled and suffered losses, this was mostly attributed to the fact that OYO primarily catered to budget and mid-segment hotels. Post pandemic gave birth to a new term “Revenge Tourism”.

As the saying goes, as long as “impulsive emotion and decision” rules supreme in travel decisions, players like OYO would thrive. With Ritesh’s dream of “On your Own”, small and mid-size hotel owners are scaling the booking charts and customer satisfaction surveys, while the budget traveller is more than happy at the ROI on a satisfied stay in terms of quality, service and pampering. That’s a perfect win-win for all, isn’t it?

Gargee Ghose

Brand Building & Digital Content Specialist. Passionate about pets and wildlife.