OYO continues to dominate the market with 2.3 MN room night transactions last quarter
Chandigarh, May 10th 2016:
OYO, India’s largest branded network of hotels announced that it hit
unit profitability at an aggregate level across its presence in 170
cities of India. OYO had operating profits until June 2015, following
which it went into aggressive expansion mode to gain market leadership.
Since February 2016, the company has regained profitability at a
network-level.
Speaking on this development, Ritesh Agarwal, Founder & CEO, OYO, said, “OYO’s
strong performance is the result of our sharp focus on the quality of
guest experience. We have utilized our technology, data science
capabilities and the benefits of scale to achieve high number of repeat
guests and growth in OYO’s brand recognition. This is a clear
manifestation of the rigor, passion and disruptive thinking we bring to
this space. We have always maintained that success in the domestic
hotels space will not be driven by size or discounting --- the market
will reward businesses that are customer-first, agile and built with a
differentiating factor.”
Ritesh added, “Our
team delivered 15x YoY growth with 2.3 mn booked room-night
transactions in Q1 Jan-Mar 2016 while our GMV continues to grow
aggressively every month. 95% of our traffic comes from our own sales
channels such as app, web and call-centre. The cities driving
profitability for us are those that have matured over the last year
which include Gurgaon, Delhi, Hyderabad and Kolkata. We plan to grow
deeper in all key business and leisure cities and triple our inventory
by December 2016.”
City
|
OYO partner hotels
|
OYO Rooms
|
Gurgaon
|
385
|
3700
|
Delhi
|
450
|
4400
|
Hyderabad
|
240
|
2700
|
Kolkata
|
320
|
2500
|
Rest of India
|
4460
|
55,000
|
ALL INDIA
|
5855
|
68,300
|
Ritesh further elaborated, “Profitability
has come from innovating revenue-sharing models, a deep understanding
of our markets and enabling new demand growth channels. These coupled
with a strong data science driven approach help us dynamically control
occupancy and room pricing. Far from being a hindrance, our large
network and scale allow us to adopt a pricing portfolio approach and
provide a wide inventory-choice for the guest. Our real-time demand
prediction engine smartly balances revenue management versus an all-out
discounting approach. This makes us the majority source of demand for
our hotel partners and enables relationships that secure a superior
experience for OYO’s guests.”
| Function | OYO |
| Employee | Acqui-hiring and building Sales Teams |
| Business | Aggressive Growth: Booked room-nights peaked in February. Launches 15 new OYO properties everyday. International pilots |
| Product | New Products (OYO for Business New Partnerships (IRCTC) and New Projects (OYO Bazaar) |
| Strategy | Innovation engine – Piloting multiple models (OYO Flagship) |
About OYO:
OYO is India’s largest branded network of hotels founded by Ritesh Agarwal, India’s first graduate of the Thiel Fellowship, a program started by Paypal founder, Peter Thiel. OYO currently operates in more than 170 Indian cities including Delhi, Gurgaon, Mumbai, Bangalore, Hyderabad, Goa, Chennai and Kolkata. These include major metros, regional hubs, top leisure destinations, as well as pilgrimage towns. OYO has also recently launched operations in Malaysia.
The company’s vision is to become the most preferred and trusted hotel brand. It is backed by the world’s leading investors including the SoftBank Group, Greenoaks Capital, Sequoia Capital and Lightspeed India.
For more information log on to- https://www.oyorooms.com/
Appendix I:
The building-blocks of OYO’s category-leadership are:
GUEST EXPERIENCE (GX)
● Essential
Standards & Strong Audit Systems - OYO has dedicated on-ground
teams conducting extensive audits of each and every room within the
network and enabling personalized support for guests. All OYOs are
audited rigorously for essential standards to identify best experience
hotels (OYO Star Partners) as well as purge non-compliant hotels (121
last year) from the network
● Competitive
Pricing: OYO’s scale has enabled it to ensure real-time availability of
inventory and a 30% lower price compared to other online hotel sellers.
OYO will continue to provide the best price for the industry with scale
and subsidy
OWNER ENGAGEMENT
● Dedicated
Owner Engagement (OE) team works hand-in-glove with hotel partners for
feedback and assistance to build relationships that enable positive GX
and high impact projects such as OYO Bazaar (marketplace for all hotel
supplies) and OYO Care (on-demand housekeeping services)
● 7
day reconciliation cycle: a deeply integrated accounting system with
our hotel partners enables live inventory and payment settlement that
provides almost immediate access to earnings
TECHNOLOGY
● A
consumer facing app (4.5 million+ downloads on Android and iOS) that
enables a fast booking experience in 5 seconds via access to a large
network of trusted hotels. Mobile channels contribute over 50% of
demand.
● OYO’s
Hotel Partner App is one of the most advanced property-management
softwares for hotels and seamlessly integrates communication and
inventory management.
DATA SCIENCES
● OYO
has developed capabilities to predict real-time demand and forecast
demand trends across every latitude/longitude in 170+ cities in India.
This gives OYO an unparalleled advantage in scaling up supply profitably
and pricing capabilities to match that supply and demand.