n Hospitality and travel technology company OYO said earlier this year that it would open around 400 properties in popular spiritual destinations by the year end. Destinations such as Ayodhya, Puri, Shirdi, Varanasi, Amritsar, Tirupati, Haridwar, Katra-Vaishno Devi and the Char Dham route are part of its expansion programme.
n Earlier this month, the IPO-bound firm launched a new advertisement campaign “to transform some outdated perceptions” about OYO properties — that they are patronised by couples only — and to highlight the fact that OYO also offers “premium experiences” to families, friends and solo adventures – that is, every type of traveller.
Taken together, these recent steps by the company seem to convey that the 11-year-old brand is trying hard to live down the perception that it is a brand that caters to people eyeing a quick and cheap getaway. The company acknowledges as much. “The rationale behind the new campaign is to highlight our upgraded services and premium offerings, breaking free from outdated perceptions,” says a company spokesperson. “OYO has always been a non-judgmental brand, catering to a wide range of needs from business travel to family visits and wedding stays. However, the “couples only” or “value brand” imagery has stuck due to societal judgments.”
Armed with such troubling feedback about the brand, it would have been tempting for OYO to go for a range of half measures to attack the perception of being “not our kinda thing” — such as releasing a series of testimonials or accentuating the brand’s ubiquity. Instead, OYO and its creative agency (Moonshot) chose to confront the issue head on, with the copy in the new spot first highlighting the “issues” the brand faces and then busting them with a flourish.
One step at a time
OYO has a tough task on hand but it can be done, say experts. “OYO has the biggest advantage that any hotel chain ever can have — it is not stuck on codes of location, luxury and service,” says Naresh Gupta, co-founder, Bang in the Middle. “It is a brand that the youngsters prefer. They can be proud of the choice the youngsters make and they can build fantastic service on top of that premise.”
As a brand designed to be at the mass end of market, what it should do is ensure that its patrons get the experience they have been promised, they have no bad experience, there is a sense of uniformity and the brand is proud of the prices it charges.
The new ad is just its newest and more visible effort in this direction. While it does highlight uniformity in its service offering, the journey to pack up on the desirability quotient started months back when it started adding smarter properties in upscale locations as well as in important pilgrimage destinations. For instance, the brand added 51 homestays and 14 hotels in Ayodhya just ahead of the Ram temple inauguration in January 2024.
Its newly launched properties include 250-plus premium properties and 60,000-plus vacation homes that promise services such as quick check-ins, spacious rooms and prime locations. These hotels carry a “company-serviced” tag on the OYO app, making it easier for customers to find and book them. These company-serviced hotels operate across various price points — from Rs 5,000 to Rs 1,000 per night.
That apart, last year OYO launched a new brand Palette to add to its other premium brands, namely, Sunday, and Townhouse. Currently there are over 12 Palette properties across Hyderabad, Kochi, Chennai and Jaipur; plus another 35-plus Palettes across India, UAE and Thailand.
The company says the choice of new destinations is driven by feedback from prospective customers. “We are continuously listening to our customers, and these decisions have come from their feedback to continuously upgrade and improve our offerings. Our goal now is to showcase our versatility,” says the company spokesperson.
This is also the right time for the brand to expand its footprint. According to the World Travel and Tourism Council, the contribution of travel and tourism to India’s GDP is expected to be 6.7% every year between 2019 and 2029. The comparatively low real-estate costs in tier-2 and tier-3 cities means the entry barriers are lower than larger cities.