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Sharjah Tourism has kept sustainability at the core in its overall tourism development. “Sharjah prides itself of its sound approach to sustainability as preservation of our rich natural heritage is integral in our development vision for the emirate, in line with the UAE’s overarching goal to promote sustainable tourism to all stakeholders. Eco-tourism plays a strong feature among large-scale projects that are in the pipeline, including key hospitality projects and service companies providing visitors with a richer travel and leisure experience,” Khalid Jasim Al Midfa, Chairman, Sharjah Commerce and Tourism Development Authority, said in an e-mail interview to T3.
Detailing about the new initiatives on the sustainable tourism front, Midfa said that the USD 12.3 million Al Badayer Desert Camp project is one of the premium adventure destinations coming up soon as an urban resort and desert lodge set to provide a totally unique Arabian adventure. Another significant development in this segment is the Mleiha Archaeological and Eco-tourism Project featuring Sharjah’s rich geological landscape that dates as far back as 130,000 years ago. The Kalba Eco-tourism project is another major development and the largest among the emirate’s sustainable tourism initiatives. “It is a carefully-designed project within Sharjah’s east coast aimed at promoting biodiversity while providing a fulfilling experience for visitors,” he added.
According to him, travelers nowadays have increased awareness on mindful travelling which is why these projects are at the core of our initiatives, to help create awareness across all sections of society on the value of nature conservation and the importance of maintaining a healthy and sustainable business. “This has been at the heart of many policies and regulations across Sharjah to keep up with the growing trend not only on nature destinations but also on sustainable cities.This approach creates a stronger leverage for unique destinations like Sharjah to continue attracting visitors – both for business and leisure across the emirate and contribute to economic growth,” he added.
Sharjah has been getting business travelers and VFRs from India and the focus was to woo family travelers and MICE from India. “Sharjah offers the growing holidaymakers from India multiple ways to enjoy the emirate. With a growing number of travel-savvy Indian millennials, our family-friendly communities offer an ideal setting to enjoy a variety of outdoor activities which makes Sharjah a destination of choice for them especially the uniquely Arabian desert landscapes, water sports activities, historical and archaeological sites, as well as parks and nature reserves. There is also an increasing trend for ‘glamping’ activities where visitors explore nature while not missing out on the modern luxury and convenience of staying outdoors,” Midfa said.
As for business travelers, Sharjah capitalizes on its leisure tourism advantages coupled with the developments in infrastructure that caters to the MICE sector such as dedicated Expo Centre Sharjah for huge exhibitions as well as the Al Jawaher Reception and Convention Centre for events focused on training, business forum and conferences. “Major developments in the hospitality sector also support the growing number of business visitors in Sharjah. Sharjah has recently expanded into the business hotel market with the Novotel Hotel Sharjah which will feature 120 rooms and suites. The hotel is close to Sharjah Chamber of Commerce and Industry. In addition, the Pullman hotel has 188 rooms and suites The emirate offers very competitive platforms for Indian businesses as their launchpad to reach out to regional markets,” he revealed.
Sharjah maintains its reputation as a global destination for families and is widely positioned as the cultural capital in the region for its rich heritage. “However, in recent years, the increasing interest among nature-seekers prompted the sector to tap ways to further capitalize our natural sceneries and create a distinctive experience for visitors. We have also increased activities such as desert adventures, including trekking, stargazing, and camping, as well as international water sports competitions and events that promote adventure for the young market and we consistently develop these portfolios through partnership with the private sector,’ Midfa informed.
Talking about the Indian arrivals, Midfa said that the number of Indian visitors who stay in Sharjah hotel establishments is steadily increasing – from 110,400 in 2016 to 138,000 in 2017. “A large composition of travelers come from the VFRs. Young travelers are also increasing, coupled with a constant mix of business tourists. There is also growing interest among travelers in value shopping, health and fitness, sports, and technologies, among others,” he said.
Sharjah Tourism has been tapping the potential of those cities that are connected directly to India by Air Arabia. However, it is now expanding its reach in India market. “Sharjah’s direct flights to 13 Indian cities cater to the large Indian community within the emirate. However, we are always looking to expand our reach to include new cities. It is important for us to develop new market reach through partnerships with key travel players located in India. Apart from that, we are constantly developing strategic initiatives that would facilitate the travel experiences of these sectors,” he said.
On marketing and promotional fronts, the Authority has already initiated numerous activities throughout the years such as organizing meetings and workshops, familiarization trips and participation in key exhibitions across India such as the SATTE Exhibition. “We will continue to boost these efforts including advertisements in key markets and optimizing our social media presence to increase engagement. We also have established our India Representative Office to facilitate our efforts and strategically sustain our campaigns,” he added.
Sandeep Shastri, Regional Director, South Asia, Sabre Travel Network speaks about the growth and dominance of the brand in India market.
With significant investment in the technology, Sabre is set to bring more innovations, than before, into the travel and hospitality vertical. The group recently partnered with Microsoft and is also set to introduce novel products for the India market.
Sabre has been in India since 2005. How has the journey been so far?
Sabre has a long history in India, being present in the market since 2005 (previously operated as Abacus, until it was acquired by Sabre in 2015). For over 13 years, Sabre has supported the development of the India travel market by providing innovative solutions that help to move the travel industry forward, in the most efficient and profitable ways. Providing new technology solutions that support agency productivity, giving access to more content to supplement market activations, and developing intelligent platforms that answer to our partner’s needs, Sabre helps agents, travellers and airlines alike, in their pursuit of success.
How would you explain the present scale of your business in India? What is the outlook you have for your business in the next couple of years?
As the Indian market continues to grow, travel partners will be on the look-out for new, automated mobile tools, to support expanding their operations.
With a solid network of agents and long-term local partners, Sabre currently is the leading Global Distribution System in APAC, and powers more than 450,000 agents in 144 countries around the world. We are committed to further anchoring our leadership throughout India.
What new products are you looking to unveil in 2018? How do these help in improving the productivity and quality?
We recently announced a long-term strategic agreement with Microsoft. As part of this new agreement, Microsoft will empower the migration of Sabre’s commercial applications to Microsoft Azure by investing cloud development expertise and services in support of Sabre’s vision to lead an industry evolution in retailing, distribution and fulfilment.
The new Sabre Red Workspace (NSRW) is also significant area of focus for us, and offers a lot of potential for development and personalisation from one agent to the next. Based on our online APIs, the NSRW provides travel consultants with the latest shopping technology. It uses some of the latest intelligent search APIs, new to online agencies, that can identify similar destinations for the same or even lower price than what was searched, and help recommend when is the best time to travel.
SynXis is your flagship products. How many hotels in India are on this platform?
Reply by Frank Trampert, Managing Director & Chief Commercial Officer, Sabre Hospitality Solutions, Asia Pacific
Sabre Hospitality Solutions enables hoteliers to enhance the guest experience, identify cost savings, and increase revenue. The cloud-based, SaaS solutions powered by the SynXis Enterprise Platform, used by more than 39,000 hotels, resorts and chains, provides unlimited scalability to manage all distribution, operations and retailing needs across every touch-point of the guest’s journey. In India, several brands work with Sabre’s SynXis platform, including Taj, Lemon Tree, Pride, Sarovar, Concept, and many others. We offer distribution to all channels using the SynXis Central Reservations, the industry’s most flexible and easy to use reservation and distribution solution.
The Govt recently launched the Regional Connectivity Scheme (RCS) to connect tier-II & III cities. How Sabre India is going to tap this potential?
Improved connectivity between tier-II and tier-III cities can only help Sabre to further strengthen its presence in the India travel market, and propel the adoption of our plug and play solutions and training opportunities across the whole of India.
Many airlines are going directly to consumer and put a nominal fee if the booking is done through GDSs. How do you see the future of GDSs?
GDSs have and will continue to deliver tremendous value to the travel ecosystem in our role as well-established, wide-scale content aggregators. We manage shopping of fares and schedules, low fare efficacy, best fares with ancillaries/fare brands and duty of care. GDS-based distribution facilitates agency operations, both brick-and-mortar and OTAs, by providing the ability to perform comparison shopping, enables efficient workflows and consolidates content in one place for easy consumption. Most importantly, we provide agents with the content they need to power their operations and give their clients the personalised experience they are looking for.
Are disruptors creating value additions to GDSs?
Successful retailers understand that the key to delivering curated experiences lies in catering to distinct buying personas. This requires a robust data-sciences approach to maximise individual consumer engagement as well as end-to-end profitability. If anything, disruptors are increasing Sabre’s global relevance by placing personalisation at the heart of consumer needs.
How are you creating awareness about your products in tier II and III cities?
Sabre is a leading travel provider with an established name in the market. With the support of our on-site teams in India, and our ongoing sales and marketing efforts, Sabre has developed a rich network of agents across the country, contributing to increased Sabre brand recognition across the market.
Vistara, a joint venture of Tata Sons and Singapore Airlines, has agreed to place firm orders with Airbus for 13 aircraft from the A320neo family and with Boeing for six 787-9 Dreamliner. Together, the deals are valued at US$ 3.1 billion, based on published list prices.
The letter of intent signed with Airbus comprises 13 firm-ordered A320neo and A321neo aircraft, as well as options for seven more aircraft from the A320neo family. In addition, Vistara will lease another 37 new A320neo-family aircraft from leasing companies. Together, Vistara will be adding a total of 50 A320neo-family aircraft into its existing fleet.
Vistara has selected the LEAP 1-A engines from CFM International to power the A320neo and A321neo aircraft, which will be due for delivery between 2019 and 2023. Vistara will use these aircraft to densify its domestic network and to support its international operations planned for later this year.
The letter of intent signed with Boeing comprises six firm-ordered 787-9 Dreamliner and Purchase Rights for four more aircraft from the 787 Dreamliner family. Vistara has selected the General Electric GEnx-1B engines to power the aircraft, which are scheduled to be delivered between 2020 and 2021. The 787-9s are intended for use on medium-haul and long-haul international routes.
Leslie Thng, CEO, Vistara said, “India’s position as the world’s fastest growing domestic aviation market and its impressive growth in air passenger traffic that has more than doubled over the last decade, makes us confident of our aggressive plans for domestic expansion and international foray. These orders are a landmark step in Vistara’s journey and demonstrate our deep-rooted commitment to contributing to the rise of the Indian aviation industry and to offering more choices to our customers. We are delighted to further deepen our relationship with Airbus and to join hands with Boeing to strengthen our modern and fuel-efficient fleet that will help achieve our thought-through ambitions.”
The addition of the new aircraft will complement Vistara’s existing fleet of 13 Airbus A320ceo and 8 A320neo aircraft that have enabled the airline thus far to achieve operational excellence. From the initial order, Vistara has an impending delivery for one A320neo which is due in September 2018.
Vistara today serves 22 destinations with over 800 flights a week and fleet of 21 aircraft. In a short span of time since starting operations in 2015, the airline has redefined the air travel experience for travellers in India, and has already flown 10 million happy customers.
The hospitality education is drastically shaping up in the country. Dilip Puri, Founder & CEO, Indian School of Hospitality speak about the evolution of hospitality and changing dynamics of skill development in the nation.
How do you see the growth of hospitality industry in India over the last couple of years?
After a decade of sluggish growth in large part due to excessive supply of rooms, the industry is now poised for a sustained period of growth fueled by increasing room rates across categories and segments. While Foreign Tourist Arrivals (FTA) helps propel this growth, changing consumer attitudes, and increasing disposable income levels are just a few of the domestic key factors driving growth within India itself. While this type of growth bodes well for the economy, remembering the key driving factor behind the entire landscape is crucial. A factor without which there wouldn’t be an industry in the first place- the people. Growth in the sector is always accompanied by increased opportunities for individuals- which is brilliant news for a country with such a large potential talent scape.
Currently there is a huge crisis of skilled talent in the hospitality industry, how does ISH address this issue? Apart from talent acquisition, talent retention has been a major challenge for the industry, what will be your advice?
At the Indian School of Hospitality (ISH), we know that the industry is currently fighting a war over talent and not just customers, and it’s crucial to provide skilled, flexible and passionate graduates to the industry to help fuel further growth. We’re changing the way hospitality education is delivered and experienced, the industry stands to benefit from an influx of human capital that is passionate, dedicated and equipped to tackle challenges head on.
ISH is also changing the traditional model of internships, during many of which students would, unfortunately, end up being underutilised and leave without significant knowledge or skills. With our industry placements and partnerships with all the major International and domestic brands, students will get to experience holistic internships that enable them to experience a professional working environment and help them get a head start on their career. With this approach, we aim to provide graduates that are ready to take on senior positions upon graduating – eliminating the need for companies to spend time and resources retraining graduates, and, in time, helping the industry unlock its further potential.
What is the current hospitality education scenario in the country? Are we at par with international standards? What are the challenges?
There’s no denying that hospitality education is steadily picking up steam within India, parallel to the industry’s steady upward climb. However, it hasn’t always been an easy path, with many institutes and curriculums failing to keep up with the changes and trends of the industry. Today’s students are no longer satisfied with rigid curriculums, outdated teaching practices and lack of practical skills – and they shouldn’t be. Hospitality and its related industries are international, colourful, and rewarding – and the education preparing students for it should be the same.
As hospitality education is slowly starting to warm up to its place in the limelight, now is a more important time than ever to drastically overhaul the entire educational experience to reflect the needs of the millennial student, as well as a rapidly changing industry.
What is the kind of courses that ISH offers? Do you also have advance level courses and add on certifications?
The education structure is aimed at providing the ideal foundation for hospitality skills, managerial and leadership development, strategic thinking, as well as an entrepreneurial outlook - providing a strong foundation for lifelong learning and further skill honing throughout graduates’ careers. To help ensure a truly international standard of hospitality education, ISH has entered into a strategic partnership with Lausanne Hospitality Consulting (LHC), the Swiss knowledge development and management advisory company of Ecole hôtelière de Lausanne. ISH has partnered with LHC in preparation for an academic certification by EHL, alongside curriculum development and faculty training. Through this partnership, ISH is developing an Undergraduate Hospitality Management Programme and an Undergraduate Culinary Arts Programme, with several long and short-term programmes in both culinary and executive education to be available in the future.
The government has announced many skill development initiatives, which can be a boon to the hospitality industry, how much has actually translated into reality?
I think it is a work in progress. Some good work has been done and much more needs to be done. Our current focus at ISH is to educate and provide talent for the industry at the management levels. We intend to get into skill development in the next couple of years, but our focus will entirely be on using technology such as VR and AR in the skilling process. We are currently setting up a dedicated VR lab at ISH for our under graduate students to use as a learning tool.
Australia & Beyond Holidays, one of Australia’s inbound travel management operator, is all set to tap the Indian market. Earlier this year, the group appointed Blue Square Communications as its India representatives. Australia & Beyond Holidays provides global solutions to Indian travel agents, from both a DMC products and FIT.
Speaking about the brand, Simon Bernardi, Director, Australia & Beyond Holidays, said, “India continues to be an important tourism market for Australia, with growth of over 15 per cent in arrivals over last year. We are very strong in the Hong Kong and South East Asian Market. India offers a lot of potential opportunities. Indians are quality travellers and also high spenders. The Indian traveller fits into our model as they are looking for experiences.”
The company is mainly targeting Indian leisure travellers and aims to promote Australia, beyond the usual itinerary. The company is well equipped to cater to the F&B requirement of Indian visitors.
Speaking about the segments, Bernardi said, “Major target segment will be the leisure travel, honeymooners and family. Australia is a family destination; it’s a very safe destination and is popular amongst Indian travellers. We know the Indian market very well and are well equipped to cater to this market. We would like to see Indian travellers go to two destinations for 14-16 days. This will give a better experience and can explore more what the cities have got to offer. What Indians do right now is go to more destinations for a short time. Australia is a repeat destination.”
He further said, “We understand the Indian customer quite well. We cater to Indian dietary requirement. Australia has a lot of Indian restaurants. We want to promote Australia beyond the typical east coast itinerary. We want to promote destinations like Adelaide, Kangaroo Island, Perth, Northern Territory, etc. We will offer something different apart from the normal destinations popular amongst the Indians. The most popular itinerary for Indian travellers are three cities; Melbourne, Sydney and Queensland. The itinerary is short as of now for Indians and they explore very quickly.”
Australia & Beyond Holidays has its online Agora booking system that offers land products and hotels worldwide, many with allocations. It is also looking to tap conference groups from India, the group provides customised as well as end to end services to such groups. “We are also looking at the conference groups; we will add value for their trips. We provide end to end services and also customised services. We have an FIT system which is best in market; this has static and dynamic rates. We have contracted hotels in a lot of hotels in Australia,” he added.
Currently, their major source markets are South East Asia and China. India is growing market for the company. Bernardi said, “We want grow strong in this market. Last year we have done 560 series group from Hong Kong, so we would like to see similar growth from this market as well.”
The hospitality industry has gone through a major disruption in the year 2017. One on side of the coin the Government is aggressive to grow the inbound numbers, whereas on the flipside the Government has taken certain steps which are tourism dampeners. The year 2017 opened with the aftershock of demonetisation, which impacted the hospitality industry, like others, for a temporary period. Demonetisation seriously injured the MICE segment than the leisure market. Next move was the Liquor banning within 500 meter range of national and state highways; this once again dampened the hospitality business sentiments in the country.
Post this silence in the industry, the government implemented the GST, which was well received by the nation. But, due to higher bracket taxation it once again came as challenge for the hospitality, only until it was revised.
Despite, all these challenges hospitality industry witnessed a strong demand. Occupancies were up, Average Daily Rate (ADRs) were up. According to a report by JLL, The strong growth was an outcome of strong demand and a dip in the development and opening of new hotels in 2017...Clearly the positive gap between demand and supply in 2017 resulted in the improved performance of hotels, and this trend is expected to continue in 2018 as well.
In terms of growth, 2017 was a strong year for the hospitality industry. Nationwide, hotels have witnessed robust growth of over 65 per cent in terms of occupancy. Even there has been a slight growth in ARR, but still not up to the mark.
Speaking about the growth S N Srivastava, President & Co-founder, Clarks Inn Group of Hotels, “We have continued to improve in terms of hotel occupancy, ARR and RevPar. Our overall occupancy last year was 68.5 per cent with a healthy ARR and RevPar. Going forward in 2018 we are expecting our overall occupancy to increase by four to five per cent. However, growing ARR can be challenging as the competition grows and new supply are added to the existing inventory. But we are hopeful that our RevPar will improve by 4-5 per cent riding on better occupancy in 2018.”
The rising disposable income of the middle class has aided exponential growth in the inbound tourism and narrowed the gap between the lean and peak time further strengthening the demand and gap supply. Speaking about the trend, Vimal Singh, MD, Golden Tulip Hotels and Resorts stated, “There has been an overall increase in the occupancy and ARR across the Industry, the nationwide occupancy crossed the 65 per cent mark for the first time since 2007/2008 and the occupancy was further complimented by an increase in the average rate. There are other drivers that fuel the growth of the Indian hospitality market such as India as medical tourism destination, steady growth of MICE segment and the increase in the young travellers. We closed our yearly occupancy with 81per cent which was higher by three per cent over previous year, this came at an ADR which was higher by five per cent over last year. We are expecting 2018 to further consolidate our occupancy and are projecting an increase of 3-4 per cent with an ADR raise of two per cent.”
In the last couple of years, India has witnessed a lot of growth in terms of new hospitality brand forays and expansion. This trend is set to continue and will only become more intense. But, as per industry experts the core growth area today is the mid market hotels segment. Global chains are today eyeing India for this particular segment. A lot of global chains have in the recent announced major expansion plans in India. This is the segment where our Indian regional chains are strong at. Indian chains, if not more, are equally on an expansion spree.
Speaking about the trend in the mid market segment, P R Bansal, Chief Operating Officer, Lords Hotels & Resort said, “Without the mid-market segment, the new traveller class wouldn’t have a choice in decent, budget accommodations. A major section of travellers today, both international and domestic are price sensitive or rather are more value conscious. With the frequency of travel increasing one does become cost conscious after a while and does not always have the liberty to splurge. There has to be a cost-effective option which also satisfies the ambience quotient and the mid-market segment of hotels offers just that. This segment is the driving growth of the hospitality sector and we foresee that it will remain in the driving seat for at least the next two decades.”
No doubt the demand for this segment has started to burgeon, but even the hoteliers have a keen interest as the midscale segment is one of the most profitable areas.
Suhail Kannampilly, COO, The Fern Hotels & Resorts said, “Absolutely the profitability margins are better in midscale, primarily since the luxury market in India is selling at midscale rates and not able to drive profit to the developers, my take on this is clear India is a huge market, there's room for all categories of Inventory to flourish. Our A category cities can still cater to many new upscale and luxury hotel and they will soon move the needle upwards with their rates and drive bottom line margins. The B &C category towns can all take midscale inventory.”
Singh feels that the rising purchasing power of the middle class, surge in the domestic travel, the fading line between the peak and the lean time are few factors that are fuelling the growth of the mid market sector. The industry is witnessing a lot of opportunity in the mid market segment and now international chains are tapping these untapped markets with the launch of their budget properties in Tier II and III cities. He further said, “We see a great potential for bread and breakfast concept in India in both budget and mid market sector and hence we are working very closely with our parent chain to bring Campanile, Premiere Class and Kyriad in India.”
In the coming couple of years, the market is set to witness an upsurge in terms of expansion. Last year, due to many challenges greenfield developments witnessed a stunted growth. Indian chains like The Fern Hotels are betting big in this market with a target of 100 hotels by 2020.
Speaking about the pipeline Kannampilly said, “We currently have 54 hotels in operation, with 32 hotels signed to open in the next 2 years. In the current financial year we are opening 15 hotels. Our target for 2020 is 100 hotels.”
Today, Indian chains are carving their own niche by expanding into unexplored territories. Lords Hotels & Resorts are one of the groups who are exploring religious destinations for expansion. The group is aiming to become a 40 property group by 2020.
Bansal explained, “Today we are operating 27 hotel properties and there are 10 more in the pipeline which will become operational later this year. We are aiming at becoming a 40 properties hotel chain by the year 2020. From here we are hoping for the brand to go into auto-pilot and the development and franchise opportunities to grow organically. However while we are entrenched in the West and to an extent in the North and South, we are yet to step foot in the Eastern markets. We are making efforts to penetrate this region and have identified potential entry points in Kolkata, West Bengal and Bhubaneswar, Orissa. Many of our hotel properties have found resonance with guests as great hotels for pilgrimage tourists. We want to build on that reputation and capitalise on the pilgrimage tourist market. We are also focusing on adding hotels in Katra, Mathura, and Vrindavan among others. While we may be an affordable mid-market chain, our services are best in its class and so to maintain the balance and not dilute the value proposition, our properties are limited to 60 – 90 keys per hotel.”
Presently, Tier II and III cities are the engine for growth for hospitality chains. These markets have a comparatively lesser real estate cost, operational cost and also yield good returns. Golden Tulip hotels which currently operates 26 hotels in the country is eyeing for expansion in the smaller markets.
Singh stated, “We currently operate 26 hotels in the country, we recently opened Golden Tulip in Khajurao and signed up over 8-10 Golden Tulip hotels in various cities. Currently we are planning to increase our foot prints in Jeolikot (Nainital), Khajuraho, Kota, Rajkot, among others. Our expansion plans are aggressive and we aim to open 10-12 hotels in next two years. We are further working to introduce three more brands in India- Premiere Classe, a limited service budget hotel that focuses on comfort, connectivity and convenience. Campanile and Kyriad are other mid-market brand that we plan to bring to the region soon.”
Similar Srivastava said, “Clarks Inn Group of Hotels is one of India’s fastest growing hotel companies with a country-wide presence in the mid-market and budget segments. The company boasts of an overall portfolio of 87 hotels, including 47 in operation, spread across 18 states in India and one in Kathmandu Nepal.”
Disruption and alternate accommodation
In the recent years, the hospitality industry has witnessed severe disruption in the changing accommodation game. Players like airbnb, Oyo and other players have clearly pumped in inventory into the market. Players like airbnb have introduced the concept of shared accommodation, whereas Oyo has been streamlining the unorganised hospitality players.
Speaking about the competition with these players, Singh said, “We see them as aggregators and now we don’t see them as threats as they are tapping the unorganised market that we can’t tap as some of these smaller hotels cannot be converted to our standards, some might not come into our brand for cost reasons while for some the cost-to-conversion would be too high.”
Some of the hoteliers believe that these players are not a threat to traditional hoteliers as long as they are on a level playing field. The government regulations should be applicable for these players as well. Bansal stated, “While online booking site offer accommodations, they aren’t really part of the hospitality segment. These stays are supposed to be a room and a roof at a stranger’s house with breakfast option. However, under the garb of such house sharing model of accommodations, some are operating like full-fledged hotels. This is unfair for the organised hotel industry that pays taxes, obtains and renews licences to operate, maintains security and follows compliances as laid down by the law. So when such disruptors disrupt, they are managing to do so by circumventing the rules, regulations and costs that a hotel has to invest in. We don’t perceive any competition as threat so long as it’s playing on a level field.”
Echoing similar opinion Kannampilly, “I always maintained, not seeing them as a threat is just denial. However, unlike Oyo who is creating very little new inventory, Airbnb is bringing otherwise unused inventory into the foray, they are also doing this under every category from Budget to Luxury. I do believe that we need to be on par in term of government regulations & licensing.”
Apart from the disruptors, today alternate accommodations like service apartments are making a mark in the country. Service apartments are not only economical but also suitable for long stay guests. Currently, there is a shortage of 190,000 rooms in the entire nation; such alternate accommodation can complement this shortfall.
Negating the fact that it won’t complement the requirement, Bansal said, “Service apartments are more cost effective especially for long stays. But it can’t complement overall room supply in India since service apartments follow fixed pricing while hotels have a dynamic pricing system. Also it’s easy to book a room in a hotel and the risk is limited in terms of stay, and in terms of amenities hotels have certain amenities like swimming pool, gym, health centre which serviced apartments don’t.”
Some of the hospitality players like Golden Tulip have themselves invested into this segment. Singh feels that due to the globalisation, there has been a rise in the expatriates coming to India for long stays, as the duration of these stays are longer- it makes sense for them to stay in Service apartments than the hotels. He further said, “We believe it’s a profitable market to focus on, we have recently launched our brand Golden Tulip Suites- that has 106 rooms, out of which 74 are suites with kitchenette, specially designed for long staying guests.”
With an increase in the number of long weekends in the first half of the year, the season has started off with a bang. With more destinations opening up for India market, the aspiration for Indians to travel more has only been boosted topped up with these holidays. The season has been robust for the industry, with a lot of travellers opting for offbeat travel apart from the traditional destinations.
Speaking about the growth this season Karan Anand, Head, relationships, Cox & Kings said, “The season is underway and we are witnessing robust growth in the outbound market. The Indian outbound market is growing at an average of 15-17 per cent and I am of the opinion that with more destinations opening up to the Indian market, there will be many more opportunities for the Indian traveller.”
Today, short haul destinations for the India market are becoming weekend getaways. A lot of repeat clients are considering destinations within five hours of travel times as the new weekend destinations. “The extended weekends has resulted in a significant uptake in domestic and international travel bookings at Travel Tours. Indian travellers are opting for international destinations like Scandinavia and Scotland to embrace the chills and Bali and Maldives to relax and rejuvenate at the scenic beaches. Short-haul and easy-visa destinations such as Singapore, Thailand, Hong Kong and Sri Lanka have also seeing an upswing,” Rakshit Desai, Managing Director, FCM Travel Solutions - Indian Subsidiary of Flight Centre Travel Group, Australia said,.
Last month, there was an extended weekend wherein the company has witnessed a 35 per cent growth in bookings. “This weekend has particular been a super busy time to travel owing to summer vacations. As compared to last year, this time, we have seen a rise of 35 per cent in bookings to such destinations,” Desai informed.
With a phenomenal rise in outbound from India; travellers are now looking at quirky and offbeat destinations. Daniel D’souza- Head of Sales, India & NRI Markets & E-Commerce, SOTC Travel said, “SOTC has witnessed the busiest time of the year with peak booking season with queries and bookings for Domestic and International destinations this summer. Indian travellers seek for immersive travel experiences. Popular activities are self drive, adventure & outdoor experiences like white water rafting and scuba diving are seeing huge demand from travellers this season. More and more travellers are seeking new and authentic experiences this summer. Indian Travellers is very value driven and are slowly getting bored with the traditional, readymade package holidays. The new trend is the innovative ‘Dynamic packaged holiday in order to attract more cost-conscious and variety-loving customers.”
Echoing similar opinion Anand said that this year they see a trend where Indians are spending more time at a destination in order to soak in the local culture and experience the local cuisine. He further added, “Europe continues to be the top favourite amongst Indian tourists and we see a significant rise in Indians travelling overseas for a holiday this year. This trend confirms the belief that Indians are now looking for immersive travel experiences without missing out on popular tourist attractions when travelling on a holiday. Apart from regular sightseeing travellers are seeking immersive experiences such as enjoying views of Paris from the River Seine Cruise, exploring Amsterdam through the canals, wandering through the fanciest shopping street in Zurich – Bahnhofstrasse, visit to a malt whisky distillery in Edinburgh and experience Toledo- a cultural melting pot renowned for its harmonious combination of three cultures of Christian, Muslim and Jewish.”
According to D’souza the destinations on the rise for this season has been Hungary and Czech Republic. “Top global destinations include East Europe, Italy, Switzerland, France, South Africa, South America, Australia and Korea. Japan is emerging as an untraditional multigenerational family travel destination. Short haul international destinations like Dubai, Thailand, Singapore, Bali, Hong Kong, Vietnam, Sri Lanka and Bhutan are popular this summer,” he added.
Vistara recently received its 21st aircraft, an Airbus A320neo powered by CFM engines. With this addition to its fleet, Vistara becomes eligible to start international operations. The new aircraft will be deployed to further strengthen the airline’s domestic network.
Leslie Thng, CEO, Vistara said, “There’s great excitement amongst all of us at Vistara, as we prepare ourselves for taking the next leap in our journey to fly international. The arrival of our 21st aircraft makes this phase even more special. It enables us to strengthen our network further, which gives us the opportunity to offer more choices in terms of frequencies to our ever-growing base of loyal customers.”
Vistara’s A320neo aircraft comes in its unique cabin configuration of 158 seats (8 Business Class, 24 Premium Economy and 126 Economy Class) as well as other industry-first features, for which the airline calls it #NotJustAnotherNeo.
As the highest-rated Indian airline on SkyTrax and TripAdvisor, and winner of numerous “Best in Industry” awards, Vistara has consistently raised the bar in the Indian aviation industry and made flying an experience to look forward to again. Vistara has flown over nine million customers, and today serves 22 destinations with over 800 flights a week.
InterContinental Hotels Group (IHG) is all set to introduce a new brand in June 2018. The major focus for this new brand is to convert existing hotels in the same segment into an IHG branded hotel. The brand will be less stringent in the hardware side but will focus on soft segment.
Speaking about the new brand Rajit Sukumaran, Chief Development Officer, EMEAA, IHG said, “We are rolling out a new brand. This brand is more convergent friendly and we will be more focused on converting hotels. We will be rolling out this brand in June. This brand has huge potential in India, as if you look at this market the upscale and upper upscale segment has a lot of local unaffiliated hotels and this brand will have less stringent standards to convert. We will mainly be looking at Brownfield conversions.”
Last year, IHG signed 20 new deals in the India market, majorly driven by the Holiday Inn family brands. “We had a fantastic year globally. India was another exceptional year for us. The market has turned better over the last few years. In 2017, we recorded a comparable RevPar growth by 11.2 per cent Y-o-Y. From a growth perspective, we did 20 new deals totalling more than 3000 rooms. This is the largest number of deals ever done in India. The Holiday Inn Brand family globally accounts for over 80 per cent of our signings every year. We do see growth in other brands too. Even in India, the majority will be driven by the Holiday Inn family, i.e. the Holiday Inn and Holiday Inn Express,” Sukumaran added,
The group has signed a deal with Samhi group to expand its Holiday Inn Express brand. “The partnership is one of the reasons for the record number of signings. Last year, we signed a deal with Samhi Hotels for 14 hotels. Out of 14, 10 are existing and operating assets and three of the Brownfield projects are almost completed and one is Greenfield asset. Of 14, we will open eight hotels this year. This partnership will help us showcase in the Tier I key cities,” he added.
The company has in the recent year’s shows interest to expand in the luxury space. Recently the group acquired 51 per cent stakes in Regent Hotels & Resorts, the deal is set to be closed in June. With this acquisition, the group is also set to introduce a separate luxury team. “We want to have a bigger presence in luxury. The Regent Hotels acquisition is expected to close in June and we will now have three brands in luxury space, Intercontinental Hotels, Kimpton Hotels & Restaurants and Regent Hotels & Resorts. Regent fills a space which was previously unoccupied as it comes in the upper end of luxury. It is rich in tradition and heritage and has a lot of recognition. By June, we will acquire 51 per cent and will be spearheading growth and operations. We will be setting up a focused luxury team to run this brand. Luxury has always resonated very well with the India market and this market has a huge potential to grow. Now with Regent being added we have more opportunity to grow, it’s important to have a presence in India.”
As per the long term strategy, the group is looking to open 150 hotels in the next 10 years in India. “In South West Asia itself, we have 32 hotels opened. We have 48 hotels in the pipeline which will open in the next five years in India. We are growing at quite a fast pace for the next five years. We are well on track to open 150 hotels in the next 10 years in India. The bulk of the growth will come from the Holiday Inn family. But we are getting good traction in the Crowne Plaza space; we are getting traction in the luxury space too. We have 12 Crowne Plaza hotels and another five in the pipeline,” he added.
With a portfolio of 90 operational hotels in India, Radisson Hotel Group aims to reach 200 properties by 2020 in this market. Earlier this year, the hospitality group got rebranded to Radisson Hotel Group from the earlier Carlson Rezidor Hotel Group. Presently, the group aims to be one of the top three operators globally in the next five years.
Speaking about the development Katerina Giannouka, President, Asia Pacific, Radisson Hotel Group said, “Earlier we had two companies, Carlson and Rezidor, with this new brand we have realigned both the companies. We are now one integrated global company. The strategy was to bring in the name of our most powerful brand into the corporate name which signals that we will be able to drive better value for our owners. Our vision is to be one of the top three operators in the next five years.”
In the India market, the group currently has a total of 140 hotels with 90 operational. This year, the group is also set to launch the first Radisson Red property in India and recently introduced Radisson Collection in India. The group also sees potential in the religious destinations for growth.
Sharing India expansion plan, Raj Rana, CEO, South Asia, Radisson Hotel Group said, “The 200 hotels will be in the next five years including those under development. So, around 130 will be operational and 70 will be in the pipeline. We have a Joint Venture (JV) with Bestech for building and operating 49 Park Inn by Radisson and Radisson Red hotels in North and Central India. The JV is progressing very well. As part of the JV, we will be opening our first Radisson Red in Mohali, Chandigarh later this year. One of our core strategies is to grow in religious destinations. We are finding these destinations stable for us, such as Haridwar, Varanasi, Katra, Tirupati and we will plan in more destinations.”
As per the five year strategy, in the Asia Pacific region the group aims to double its existing keys and also employees. The group is also investing in the technology segment to launch a new platform. “Asia Pacific is one of the most energetic regions in the world. India within Asia Pacific is one of our most important markets. India is one of our largest markets currently in Asia Pacific and we have about 18000 hotel rooms across this region and we look to double that in the next five years. In terms of employees, we have close to 25000 employees across the region and we will be doubling these figures in the next five years. Technology is a key focus and we are investing a lot into it. We are building a new platform which will give more value to our owners and make it easier to book a hotel,” Giannouka said.
She further said that there is a huge scope in the India market for the midscale brands. “We see most of our growth in upscale and the mid segment brands. We have launched the Radisson Collection brand in India in affordable luxury segment. As the market matures in India, we will look to open more brands here. At the entry level, we have a brand called Prizeotel an economy product with a very strong design. Currently, this brand is in Europe and possibly this could be a brand which we will look to open in India. Our next five year strategy is to finely sharpen our brand architecture. We are looking more at the lifestyle segment, Radisson Red will be that brand,” Giannouka added.
In India the expansion of the group is based on the hub and spoke model. “We follow the Hub and Spoke strategy in India. This plays into expanding our portfolio reach into all markets within two to three hours drive to the major markets. As the highways are improving in India, opening hotels along the highways is a key part of our strategy in the India market,” Rana said.
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