Singh began by explaining his new role, “I take care of sales and marketing, the entire revenue base and also business development, which primarily means where Lemon Tree needs to go as a company, where we are going to open and where we would like our footprints to be in.”
Singh took the opportunity of this interview to announce the latest acquisition of Lemon Tree Hotels in Bandhavgarh. “We have put in our investments and will be expanding the existing resort to 30 cottages once work is finished,” he added.
It is the leisure market which Lemon Tree Hotels wants to foray into now, “It is something we are seriously and aggressively pursuing,” began Singh. The themes which the company wants to follow are broadly: wildlife, pilgrimage, golf and hills. “We are building our own resort in Udaipur, we are building Shimla, while in Katra, a pilgrimage venture, we took the management route. Tarudhan in Manesar, also a managed property, is our foray into golf tourism,” he told us, explaining that this was the model a mix of owned and managed, which was the way forward.
Why leisure, we asked? “We've got the business portfolio growing. Except Mumbai, where we are building a thousand rooms, we are practically in every big corporate hub of India. The aim now is to capture the entire share the wallet of our customer, by venturing into leisure. The average Indian takes three to four holidays a year. Short trips have become the in thing. It’s a big market space, which is why, we have a big focus on leisure and the resort portfolio,” Singh told us.
And though there are places where the management contract route is being taken, “Lemon Tree is also aggressively looking at investing in this portfolio. There are places we are looking at buying land and building, there are places we are looking at acquiring resort as well,” he told us, besides looking at managing existing resorts, of course. The aim was to add at least 10 resorts to the leisure portfolio.
“From the point of sales and marketing, we are now expanding two things. The predominant customer is the Indian domestic customer. In bound is a dying segment, if you ask me. We have now strengthened our domestic team. I have an offline domestic team which is majorly covering big domestic hubs, Delhi, Mumbai, Gujarat, West Bengal,” Singh said when asked about his sales and marketing strategy.
“Today the OTAs have completely taken over. Every hotel company is experiencing a big surge in their online sales. If you ask me, for us online is 30 per cent. The online reservations go a long way in filling up the resort rooms,” he added.
The target for the year, he shared, was to take up ARRs dramatically, an increase of between 25 to 30 per cent, in fact.
“We feel that the market is now buoyant. It's the right time to go in for a price hike. We finished last year at 74 per cent occupancy for the group. There isn't much you can do in terms of occupancy. For us, the only route to take up revenue is rates and we are aggressively looking at a rate increase now,” he announced.
While the deeper markets would be able to absorb the rate increase better, some of the shallow markets and those that are hugely oversupplied, would be the challenge ahead, Singh said. “If you look at the big cities, Bangalore, Hyderabad, Pune, Delhi, we will be able to drive a substantial rate increase, which is what we are aiming at,” he added.