Hotels raise stakes on pandemic-era bets to ramp up revenue playbook
Hotel chains in India are capitalizing on ventures initiated during the pandemic, transforming them into significant revenue streams. These include diverse offerings like gourmet food delivery, boutique hotels, and sleep essentials retail. Chains are expanding their reach through innovative formats and smaller inventory footprints, tapping into segments with higher yields and faster recovery cycles.
Hotel chains are raising their bets on new businesses started during the pandemic-era, with some even emerging as critical revenue generators.From home delivery of food to boutique stays, and retailing sleep essentials, hotel chains had entered into diverse segments to sustain their businesses amid severe disruptions caused by the pandemic.
Besides Tree of Life and a reimagined Ginger brand, Indian Hotels Company's (IHCL's) new business vertical also includes home stay brand ama Stays & Trails and Qmin. Initially launched as a gourmet food delivery app during Covid-19, Qmin has since transformed into a multiformat concept.Deepika Rao, executive vice president of new businesses and hotel openings at IHCL said Qmin, with its multiformat presence across all-day-diners at Ginger hotels, lifestyle cafes, food pods and QSR outlets at airports has over 90 outlets, while ama Stays & Trails will scale to over 500 bungalows in the next few years from over 300 currently."Under Accelerate 2030, IHCL's five-year strategy road map, the new business vertical is set to deliver a revenue CAGR of over 30%," she said.
Launched in 2021, ITC Hotels' Gourmet Couch started out as a means to bring the hotel chain's signature dining experiences to homes. Today, Gourmet Couch is available through the ITC Hotels App, as well as popular food delivery apps across locations such as Delhi NCR, Agra, Jaipur, Kolkata, Hyderabad, Bhubaneswar, Guntur, Mumbai, Bengaluru and Ahmedabad.ITC Hotels also launched a boutique hotel brand Storii, which currently has seven operating properties across Goa, Kolkata, Manali, Solan, Dharamshala and Jaisalmer. In 2021, it also launched the first ITC Hotels Sleeep boutique at New Delhi's ITC Maurya, offering a collection of sleep essentials. These boutiques have since expanded to cities such as Bengaluru, Chennai, Hyderabad, and Kolkata. "These innovations are not just pandemic stop-gaps; they have expanded our reach, and created new ways to engage with guests," said a spokesperson for ITC Hotels.Radisson Hotel Group launched Radisson Individuals during the pandemic. The segment offers independent hotels the ability to retain their own character while gaining access to Radisson Hotel Group's distribution reach and loyalty programme. Nikhil Sharma, MD and COO, South Asia, at the chain said this model has seen strong interest from hotel owners, with 20 hotels currently operational across locations such as Imphal, Kasauli, Dhanbad, Yavatmal, Jim Corbett, Udaipur, Gopalpur, Katra, and Navsari. "We are also launching in locations such as Bhubaneswar, Gwalior, and Shirdi," he added.The past five years have been one of the most transformative in modern hotel history, said Nandivardhan Jain, founder and CEO of Noesis Capital Advisors.He said hotel chains have been forced to rethink their strategies to cope with factors such as the Covid-19 impact, structural shifts in traveller demographics and booking behaviour. "The result has been an accelerated introduction of new hotel formats that are fundamentally altering the economics of hotel development and operations," said Jain. "The boutique segment has moved from the periphery to a central growth pillar for many chains. Smaller inventory footprints (20-80 keys), and immersive local positioning have enabled chains to tap into a segment that delivers higher yield and faster recovery cycles than conventional upscale brands," he added.
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