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India witnessing continuous boom as travelling spurts
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Saturday, 01 September, 2018, 08 : 00 AM [IST]
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Nandita Vijay, Bengaluru
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Rise in global travel, propensity to splurge among domestic tourists, spur in business travel besides emergence of millennial population which looks for technology and convenience of connectivity are accelerating the growth of the Indian hospitality sector. This along with loyalty programmes, special privileges and cashbacks to woo the regular guests’ further enables market expansion of the Indian hospitality industry.
In order to cope with the demand, the hotel industry is increasingly looking at a combination of organic and inorganic paths. There is access to funding, interest in collaboration and increased acquisitions that allow the setting up of high-end luxury or budget hotels across the country and even eye global market entry.
According to reports, India Hotels Company or the Taj Group is in dialogue with Claridges Hotel and Sarovar is increasing number of hotels and set to have 15 more properties by end of next year.
Current scene in India
At present, India is witnessing continuous boom in hospitality due to enormous increase in world travellers leading to a thriving demand. And Bengaluru being a tech hub is a city for business travellers. The investors in hospitality industry have capitalised on the business convention traffic and are a major driver for year-on-year growth of our hospitality portfolios.
“To attract new and retain old new client base, the hotels are working towards daily innovations, special offers and deals for the corporate offices and companies,” stated Amit Kumar, hotel manager, Aloft Bengaluru Cessna Business Park.
We are confident that the industry will witness steady growth and some brand consolidation. Indian economy will remain resilient. Last year, the industry witnessed a steady growth, though marked by challenges like the GST roll-out and regulations on liquor sales.
“Between 2018 – 2022, these four years, we expect growth to pick up, by at least an industry average of seven per cent to 10 per cent, with e-commerce and digital medium playing a significant role in hotel sales,” observed Akash Gupta, general manager, Gokulam Grand Hotel and Spa, Bangalore.
Visible trends
The key trend that influences hospitality business in today’s time is, seamless technology experience. Today’s customer prefers technology that helps simplify stay at the hotel. Aloft Bengaluru Cessna Business Park is one such hotel which is built to cater to today’s millennial customer, who is a tech-savvy traveller and has an expectation of a digitally advanced hotel in terms of high speed Internet, smart room keys or digital conference facilities.
The hotel has keyless feature that allows the guests to use smartphone to check into their room using the Starwood preferred guest app which can be downloaded both on iPhone and Android, according to Kumar of Aloft.
“Providing a hi-speed wireless Internet access is a must for hospitality industry whether the guests are travelling for business or pleasure and developers are now working towards fulfilling bandwidth requirement for multiple devices be it a smart phone, laptop or a tablet as the demand increases exponentially,” added Kumar.
Meanwhile, “Travel will be experiential, conscious of the environment, sensitive to natural habitat and resources. Price play will be a keen contributor, as e-commerce/online sales and dynamic pricing will affect consumer behaviour. Outliers like Airbnb have created a demand for travel by providing local stay experiences and price-sensitive options. Brands have to keep this in mind as they scale up,” said Gupta of Gokulam.
Drive growth and revenues
The unique challenge for hospitality industry/hotels would be staying relevant to today’s accelerated customer and expectation. The consumer is fast and ever-changing and it becoming prime to keep up with the pace to maintain loyalty and guest satisfaction which drives growth and revenue, according to Kumar of Aloft.
Chipped in Gupta, “The consumer has too many options and very little time to decide. The biggest challenge for the industry is to be able to occupy mind of the consumer for prolong period of time through relationships and the product standard.”
Since there are so many options for the guest to choose from, the trend of undercutting remains to grab the business which over the years has resulted in the profitability decrease. A lot of hotels stick to the RevPAR (revenue per available room) theory for survival rather than going the ADR way. Now this is a performance metric used in the hotel industry. Most of the hotels are concentrating on investments towards renewable energy and water conservation to reach the benchmark HLP levels. Of course, environmental sustainability remains an area that deserves attention.
Guests opt for select hotels
Today’s new generation business travellers and leisure and solo travellers have made the hospitality industry to mull over the new concept of unconventional accommodation and reinvent the hotel experience. Smart and digitally savvy travellers are preferring to book the entire experience digitally starting from the online booking, digital smart keys to check into their rooms.
Leisure travellers are not just looking for a bed, shower and breakfast facility, rather they are looking for an end-to-end experience of leisure and activities at their place of stay. A segment of foreign tourists wants to stay with the local accommodation to enjoy the local experience, according to Kumar of Aloft.
Gupta of Gokulam noted, “Brand loyalists will prefer standardised service and the comfort of familiarity and the rewards /loyalty programmes. Else, travellers will be guided by pricing. This is a standard consumer behaviour with differentiators being personal preferences – culture, place, length of stay etc.”
Inflation rocking expenses
As in any industry; inflation will affect the cost of the product accordingly. Hospitality is a 24/7 industry and while we do try to ensure that room tariffs remain as unaffected as
possible. Though some of the inflationary pressure on the price is to be expected,
according to Gupta.
Workforce and training
More skilled workforce is the need of the hour to run the huge number of hotels in demand and we ensure the talents undergo a set process of continuous learning, training and development for all departments to that they are job-ready, as per Kumar.
For Gupta, hospitality management in theory and practice were different. The industry needs professionals who are more self-aware and not averse to the high pressure environment and the demanding nature of this industry. On the job training helps for sure. However having a real passion and talent for hospitality is a trait few possess.
The hospitality colleges need to get better quality students and should offer a one-year internship in the hotels as a part of the curriculum to ensure this sector gets well trained and at least 40% ready manpower which is non-existent.
Training is a constant, on-going tool for any industry and is a must for executives at all levels of hierarchy to keep up with the growing pace and innovative trends which the respective industry has to offer.
Relevance of mgmt courses
According to Kumar of Aloft, India has some of the top ranked hospitality schools in the world and recent programmes at these schools are comprehensive, focussed, and are committed to innovative approaches for hospitality, courses with more hands-on learning for the associates.
Hospitality management courses have evolved over time. In the years to come, I hope that basic management principles are added in as well in the curriculum so that we have students who can become holistic hospitality professionals with sound managerial capabilities. It will also help them to opt for higher business studies and career transition, should they look at a career growth in sales, marketing, revenue and analytics.
“For students to have a better practical understanding of the rigorous life of a hotelier; a one-year internship as a part of curriculum should be a priority suggestion for the colleges to follow,” trailed off Gupta.
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