OYO Townhouse - Spreading the Word of ‘Pocket-Friendly Accommodation’ From India to the UK

OYO, THE brainchild of 24-year-old Ritesh Agarwal, which started their operations with one single hotel in the year 2013… five years down the line – the Gurgaon-based hospitality company is now part of the coveted Unicorn Club of India following the recent funding of USD 800 mn from Japan-based Softbank Vision Fund, hence surging the company’s valuation to about USD 4 bn. The company is deemed to be the largest hotel chain in South Asia.

Right since it was founded, with every year passing, the home-grown budget hotel chain only kept progressing as one could witness the company expanding its footprint from one single hotel in January 2013 to 13 properties in July of the next year. OYO’s website reads that the company now has over 8500+ properties to its portfolio, with a staggering presence in China, Malaysia, Indonesia, Nepal and the UAE.

With the completion of four years in the market, OYO announced in January 2017 that they are launching their OYO Townhouse brand – a product tailor-made for the new-age millennial business travellers. Ever since, the name has been frequenting on almost all the mainline business newspapers painting the brand’s business model, occupancy, and expansion plans both in India and its recent venture in the UK.

Ankit Tandon, COO, Self-operated business at OYO (OYO Townhouse) interacted with BW Hotelier to decode OYO Townhouse’s expertise and expansion plans in the hospitality industry.

“OYO’s mission is to create beautiful living spaces while delivering quality experiences for our guests. With OYO Townhouse, we’ve launched the category that combines experience and value at a scale that has never been attempted before in the Indian hospitality landscape.” hails Tandon.

OYO Townhouse – Not another Mundane Hotel Next Door

OYO Townhouse – Custom-made to cater to the needs of the new-age traveller, and breaking the knack of one-size-fits-all stereotype followed by the conventional hotel chains, Tandon said, “We have designed OYO Townhouse keeping in mind the preferences of today’s millennial generation. These hotels are equipped with high-speed internet, whiteboards, business services, magazines, Netflix, Kindle and a 24x7 kitchen.”

Speaking about the design perspective of the hotels, he said, for the interiors, they’ve followed a minimalistic approach with a bold and unique colour scheme - Red & Grey. He added, every single element – right from the breakfast menu to the booking process – have been re-engineered to deliver higher quality and better value. “Also, every Townhouse is designed to complement its neighbourhood, where the residents staying in these areas can use the property as an alternative workplace, experience a vast array of global cuisines, and access the lounge and retail store with exclusive merchandise,” said Tandon.

OYO Townhouse hotels receive both corporate travellers as well as those travelling for leisure, according to Tandon. “What we have observed is that most of these travellers especially the millennials like to switch seamlessly from work to play and want the freedom to choose, change and decide at a moment’s notice. Hence, the concept was derived based on the needs of those who attach great importance to individuality and self-expression,” he further added.

Contented with the positive response received by the varied visitor profile to Townhouse, Tandon said, “This reinvention has resulted in a new kind of hotel that’s optimised for comfort, efficiency, convenience and affordability. Townhouse operates as 25% hotel, 25% home, 25% cafe and 25% merchandise store – to deliver an all-encompassing experience to guests.”

Townhouse’s Operation Model

Telling BW Hotelier about the brand’s operating model, Tandon said, “OYO Townhouse hotels are fully-operated by us wherein there is either a lease or a management contract with the asset owner. As we follow a standard design and decor approach for Townhouse hotels, every hotel undergoes the transformation process to become an OYO Townhouse. These hotels are self-operated and managed by OYO, and the OYO staff manages to take care of every aspect of the customer’s experience, including reception, housekeeping and on-ground assistance.”

Room Inventory and Occupancy

Townhouse hotels record ~90% occupancy across the network, said Tandon. “We’ve received an overwhelming response from guests. These hotels enjoy an occupancy of ~90%, with ~80% of our guests giving us the highest ratings post their stay with us. Almost 50% of our guests choose to return to a Townhouse for their travels,” he told.

The category has gained leadership in the mid-market segment and now has 1400+ rooms in 45 hotels across India and the UK, in destinations like Delhi, Gurugram, Mumbai, Pune, Kolkata, Jaipur, Goa and London, informed Tandon.

Way Ahead

Emphasising on the brand’s penetration into newer markets pan India and abroad in the coming years, Tandon told, "With an inspiring feedback and trust of our asset partners, we will expand the Townhouse brand to new cities and countries and open 400-500 hotels by the end of 2019. Currently, in addition to India, Townhouse hotels are also available in the UK, which is also the newest international market for us.”

To enhance the experience at Townhouse, Tandon said that they pay intense attention to their customers and their expressed and unexpressed needs. “Depending on their feedback and needs, we will consider adding or enhancing the amenities we provide at Townhouse hotels,” he concluded.