Hotels and homes chain OYO today announced that it has now become China’s second-largest hotel chain in terms of room count within 18 months of its launch in the country. OYO claimed that with presence in 320 cities and having nearly 10,000 partner hotels with 450,000 rooms, it has become bigger than existing traditional chains including Home Inn, Hanting etc., in terms of scale.
OYO’s China entity that operates under the brand name OYO Jiudian offers accommodation “in less than RMB 150 (Rs 1,514) also while over 200,000 heads are on OYO Jiudian pillows everyday,” said Sam Shih, COO, OYO China.
OYO Jiudian has created more than 100,000 jobs since launch while over 97 per cent of franchisee partners have renewed their contracts with OYO. The company’s share in China’s accommodation market stands at below 2 per cent (around 35 million rooms), said Shih in a company statement.
“OYO’s focus in China is across tier-2 to tier-6 cities. The occupancy for property owners who have partnered with OYO for more than three has gone up by 2X on average. Also the ratings for many of these hotels on online travel agent (OTA) platforms like Fliggy are significantly up,” an OYO spokesperson told Financial Express Online.
OYO is also eyeing tie-ups with OTAs like Fliggy, Ctrip to provide better visibility to the hotel owners online globally. OYO had recently announced collaboration with Alibaba’s online payment arm Alipay to launch the OYO miniprogram in Alipay that would focus in areas including “membership, traffic exchange, scenario integration, finance services, smart payment, credit life, and hotel upgrades,” OYO said.
Miniprogram is among the key strategies for Alipay over coming three years that would enable Alipay to “empower industries and ecosystems better and help store owners realize digital transformation and all-scenario marketing,” said Jing Xiandong, CEO, Ant Financial Services.
OYO envisions to become the world’s largest hotel chain by 2023 from being sixth largest currently and has presence in over 800 cities across 24 countries. Its current investors include SoftBank, Sequoia Capital, Lightspeed Ventures, Hero Enterprise, and China Lodging Group.
OYO is India’s third largest startup in terms of valuation. It is currently valued at around $5 billion since its September 2018 fundraising from SoftBank. Digital Payments company Paytm, however, sits on top with a reported valuation of around $10 billion.
On the other hand, Ola’s valuation is hitting $6.2-billion mark following $352 million investment from Hyundai and Kia Motors, showed regulatory filings sourced by business signals platform Paper.vc