Hospitality industry
If a stranger who looks for help at an unfriendly place it is the hospitality which offers warmth to them. It refers to the process of receiving and entertaining a guest with goodwill. Hospitality in terms of commercial aspects refers to the activity of hotels, restaurants, catering, inn, resorts or clubs which make a vocation of treating tourists.
With the help of efforts of the government and all other stake holders, including hotel owners, resort managers tour and travel operators and employees who work in the sector, Indian hospitality Industry has gained a level of acceptance world over. It has yet to go miles for recognition as a world leader of hospitality .Many people take Indian hospitality service not for its quality of service but India being a cheap destination for leisure tourism.
The hospitality Industry is a 3.5trillion dollar service sector within the global economy. It is an umbrella term for a broad variety of service industries but not limited to hotels, food services, casinos and tourism. The hospitality industry is very diverse and global. Today hospitality sector is one of the fastest growing sectors in India. It is expected to grow at the rate of 8% between 2007 and 2016. Many international hotels including Sheraton, Hyatt, Radisson, Meridian, four seasons' regent and Marriott International are already established in the Indian markets and are still expanding. Nowadays the travel Industry is also included in hospitality sector. The boom in travel and tourism has led to the further development of hospitality Industry.
In 2003-2004 the hospitality Industry only 2% of the GDP.It is projected to grow at a rate of 8.8% between 2007-2016 which would place India as the second fastest growing tourism market in the world. This year the number of tourists visiting India is estimated to have touched the figure of 4.4 million. With this huge number India is becoming the hottest tourist destination. The arrival of foreign tourists has shown a compounded annual growth of 6%over the past 10 years. Travel and tourism is the second highest foreign exchange earner for India. It is also estimated that the tourism sector will account for nearly 5.3% of GDP and 5.5%of total employment.
EVOLUTION
Hotel Industry in India has witnessed tremendous boom in recent years. Hotel Industry is linked to the tourism Industry and the growth in the Indian tourism industry has fuelled the growth of Indian hotel Industry. Due to increased business opportunities in India have acted as a boon for Indian hotel Industry. The arrival of low cost airlines and the associated price wars have given domestic tourist a host of options. The 'INCREDIBLE INDIA' destination campaign and the recently launched 'ATITHI DEVO BHAVAH' (ADB)' have also helped in the growth of domestic and International tourism and consequently the hotel Industry.
To overcome this shortage Indian hotel Industry is adding about 60000 quality rooms, currently in different stages of planning and development, which should be ready by 2012. Hotel Industry in India is also set to get a boom with Delhi hosting 2010 commonwealth games. The future scenario of Indian hotel Industry looks extremely smooth. It is expected that the budget and mid-market hotel segment will witness huge growth and expansion while the luxury segment will continue to perform extremely well over the next few years.
INTRODUCTION
"Marketing takes a day to learn...unfortunately, it takes a lifetime to master"
~Philip Kotler
TOURISM IN INDIA FACTS AND FIGURES
Star Rated Hotels
Ø It forms 30% of industry.
Ø Eg : ITC,Taj Group, Oberoi Group, ITDC
Ø 4 star & 3star : For middle level business, executive/leisure travelers.
Ø 2 star & 1 star: Around tourist spot, preferred by domestic tourist.
Ø 5 star Deluxe & 5 star: Luxury at high price, 27 % Govt. approved rooms.
Ø Built over 18000 sq.m Area
The major players in the hotel industry can be broadly classified into Public Players And Private Players.
PUBLIC SECTOR PLAYERS:
§ ITDC Hotels
§ Hotel Corporation Of India
PRIVATE SECTOR PLAYERS:
§ ITC Hotels
§ Indian Hotels Company LTD.(THE TAJ HOTELS)
RESORTS & PALACES:
§ Oberoi Hotels (EAST INDIA HOTELS)
§ Hotel Leela Venture
§ Asian Hotels Ltd.
§ Radisson Hotels & Resorts
TOURIST INFLOW - HOTEL DEMAND
According to U.N World Tourism Organisation (UNWTO)
According to U.N World Tourism Organisation (UNWTO)
• Foreign Tourist Inflow INCREASED FROM :
3.9 Million (2005) 4.4 Million (2006) 4.95 Million (2007)
• Domestic Tourist Inflow INCREASED FROM:
366.23 Million (2004) 462 Million (2006)
• Tourist inflow increase hotel occupancy ratio (Currently 75 - 80%)
Average increase in room rate (Currently 22 - 25%)
EXPECTED GROWTH
According to tourism industry, tourist inflow will soar to 10 million by 2010, thus leading to a demand for 10,000 more rooms.
According to a research released by world travel & tourism council, India's travel & tourism is expected to generate US$ 100 Billion in 2008 to US$ 275.5 Billion by 2018.
As reported by MAFOI Management consultants around 40 international hotel chains are expected to invest in the Indian Hotel Market by 2011. This includes Hilton Accor, Mariott International.
PROJECTS IN INDIA'S PIPELINE
- There are 161 projects in progress out of which, 100 will have four and five star designations.
- The other 61 are one, two, and three star developments. A number of them are new economy brands recently designed for the Indian market place.
- Taj's is one such brand, Lemon Tree and Red Fox are others in this category.
- The centre and states are also working out a PPP (Public Private Partnership) to increase hotel capacity
S.W.O.T. ANALYSIS OF INDIAN HOTEL INDUSTRY
STRENGTHS:-
India has a very rich cultural heritage. The "unity in diversity" tag attracts most tourists.
Indian hotel industry is facing a mismatch between the demand and supply of rooms leading to higher room rates and occupancy levels. With the privilege of hosting Commonwealth Games 2010 there is more demand of rooms in five star hotels. This has led to the rapid expansion of the sector.
The government has realized the importance of tourism and has proposed a budget of Rs. 540 crore for the development of the industry. The priority is being given to the development of the infrastructure and of new tourist destinations and circuits. The Department of Tourism (DOT) has already started the "Incredible India" campaign for the promotion of tourism in India.
India's share in international tourism and hospitality market is expected to increase over the long-term. New budget and star hotels are being established. Moreover, foreign hospitality players are heading towards Indian markets.
WEAKNESSES:-
Though the government is taking necessary steps, many more things need to be done to improve the infrastructure. In 2003, the total expenditure made in this regard was US $150 billion in China compared to US$ 21 billion in India.
The lack of adequate recognition for the tourism industry has been hampering its growth prospects. Whatever steps are being taken by the government are implemented at a slower pace.
The internal security scenario and social unrest also hamper the foreign tourist arrival rates.
OPPORTUNITIES:-
Owing to the rise in income levels, Indians have more spare money to spend, which is expected to enhance leisure tourism.
With the open sky policy, the travel and tourism industry has seen an increase in business. Increased airline activity has stimulated demand and has helped improve the infrastructure. It has benefited both international and domestic travels.
THREATS:-
The total dependency on foreign tourists can be risky, as there are wide fluctuations in international tourism. Domestic tourism needs to be given equal importance and measures should be taken to promote it.
Several international majors like the Four Seasons, Shangri-La and Aman Resorts are entering the Indian markets. Two other groups - the Carlson Group and the Marriott chain - are also looking forward to join this race. This will increase the competition for the existing Indian hotel majors.
Impact of Recession on Industry
The state of turmoil in global financial markets has generated new concerns for the hospitality industry.
Existing hotels in India are also likely to benefit from the improved performance of the non-room sources of income, namely Food & Beverage (including banquet operations), Spa, Corporate Club memberships and other ancillary services.
India is expected to see Asia's biggest drop in corporate travel spending, falling 25% this year compared to 2008.
Trends that will shape the future of hospitality sector are:
- Low Cost Carriers
- Budget Hotels
- Service Apartments
- Technology
- Loyalty Travel
Challenges for the hospitality industry are:
- Shortage of skilled employees
- Retaining quality workforce
- Shortage of rooms
- Intense competition and image of India
- Customer expectations
- Manual back-end
COMPANY PROFILE
OBEROI GROUP OF HOTELS
The Oberoi Group, founded by Rai Bahadur Mohan Singh Oberoi in 1934, operates 27 hotels and three cruisers in five countries under the luxury 'Oberoi' and five-star 'Trident' brands. The Group is also engaged in flight catering, airport restaurants, travel and tour services, car rentals, project management and corporate air charters.
'Oberoi Hotels & Resorts' is synonymous the world over for providing the right blend of service, luxury and quiet efficiency. Internationally recognised for all-round excellence and unparalleled levels of service, 'Oberoi Hotels & Resorts' has received innumerable awards and accolades.
A distinctive feature of The Group's hotels is their highly motivated and well trained staff that provides the kind of attentive, personalised and warm service that is rare today. The Group's new luxury hotels have established a reputation for redefining the paradigm of luxury and excellence in service amongst leisure hotels around the world.
Trident hotels are five-star hotels that have established a reputation for excellence and are acknowledged for offering quality and value. These hotels combine state of the art facilities with dependable service in a caring environment, making them the ideal choice for business and leisure travellers. Presently there are eight Trident hotels in India located in Mumbai, Gurgaon (Delhi National Capital Region), Chennai, Bhubaneshwar, Cochin, Agra, Jaipur and Udaipur. Trident, Bandra Kurla, Mumbai is scheduled to open in 2009. The Oberoi Group also operates a Trident hotel in the Saudi Arabian city of Jeddah.
The last decade has witnessed the debut of new luxury Oberoi leisure hotels in India and abroad. In India, these hotels include The Oberoi Rajvilas, Jaipur; The Oberoi Amarvilas, Agra; Wildflower Hall, Shimla in the Himalayas; The Oberoi Vanyavilas, Ranthambhore; The Oberoi Cecil, Shimla and The Oberoi Udaivilas, Udaipur. Overseas, the new hotels include The Oberoi, Lombok in Indonesia, The Oberoi, Mauritius and The Oberoi, Sahl Hasheesh in Egypt. The Oberoi Zahra, Luxury Nile Cruiser, Egypt was launched in 2007.The Group's commitment to excellence, attention to detail and personalised service has ensured a loyal list of guests and accolades in the worldwide hospitality industry. Recognising the importance of quality training in hospitality management, The Oberoi Group established The Oberoi Centre of Learning and Development in New Delhi in 1966. The Group is committed to employing the best environmental and ecological practices in technology, equipment and operational processes. The Oberoi Group also supports philanthropic activities that range from education to assistance for the mentally and physically challenged. The Group is also a keen contributor to the conservation of nature and of cultural heritage.
Globalisation of The Oberoi Group
To place The Oberoi Group on the world map, Mr. Oberoi exported management expertise to Australia, Egypt and Singapore, where The Oberoi Group took charge of the management of existing luxury hotels. The success of Oberoi Hotels & Resorts overseas, in the face of global competition, greatly enhanced the image of The Group. Today, Oberoi Hotels & Resorts in Egypt, Mauritius, Saudi Arabia and India add value and distinction to their host countries.
Foundations of the Future
Under Mr. Oberoi's dynamic leadership, The Oberoi Group introduced its second brand of hotels, 'Trident'. Trident hotels are five-star hotels that have established a reputation for excellence and are acknowledged for offering quality and value. These hotels combine state of the art facilities with dependable service in a caring environment, making them the ideal choice for business and leisure travellers. Presently there are eight Trident hotels in India located in Mumbai, Gurgaon (Delhi National Capital Region), Chennai, Bhubaneshwar, Cochin, Agra, Jaipur and Udaipur. Trident, Bandra Kurla, Mumbai is scheduled to open in 2009. The Oberoi Group also operates a Trident hotel in the Saudi Arabian city of Jeddah. In the luxury category, The Group opened The Oberoi Rajvilas, Jaipur; The Oberoi Cecil, Shimla; The Oberoi Udaivilas, Udaipur; The Oberoi Vanyavilas, Ranthambhore; The Oberoi Amarvilas, Agra; Wildflower Hall, Shimla in the Himalayas; The Oberoi, Lombok, Indonesia; The Oberoi, Sahl Hasheesh, Egypt and The Oberoi, Mauritius and The Oberoi Zahra, Luxury Nile Cruiser, Egypt. The Group employs more than 12,000 people worldwide and operates 27 hotels and three cruisers in five countries. Mr. Oberoi's achievements and successes did not, however, take from his simplicity and old fashioned charm. He retained, until his death in May 2002 at the age of 103, a unique humility. He was fond of saying, "I have been able to accept the challenge and make good. There is comfort in knowing that whatever little I have achieved has also helped to raise the prestige of my country."
Mission & Vision
Mission
Our Guests
We are committed to meeting and exceeding the expectations of our guests through our unremitting dedication to every aspect of service.
Our People
We are committed to the growth, development and welfare of our people upon whom we rely to make this happen.
Our Distinctiveness
Together, we shall continue the Oberoi tradition of pioneering in the hospitality industry, striving for unsurpassed excellence in high-potential locations all the way from the Middle East to Asia-Pacific.
Our Shareholders
As a result, we will create extraordinary value for our stakeholders.
Vision
We see an organization which aims at leadership in the hospitality industry by understanding its guests, and designing and delivering products and services which enable it to exceed their expectations. We will always demonstrate care for our customers through anticipation of their needs, attention to detail, distinctive excellence, warmth and concern.
We see a lean, responsive organization where decision making is encouraged at each level and which accepts change. It is committed and responsive to its guests and other stakeholders.
We see a multi-skilled workforce, which consists of team players who have pride of ownership, translating organizational vision into reality.
We see an organization where people are nurtured through permanent learning and skill improvement, and are respected, heard and encouraged to do their best. Oberoi is recognized as best practice for training and developing its people.
We see a more multinational workforce which has been exposed to different cultures, problems and situations and can use its experiences to enrich the local employees whether in India or overseas.
We see the world dotted with hotels of The Oberoi Group, in strategic commercial and resort locations.
We see user-friendly technology enhancing value for our customers and helping our personnel by making information more accessible.
We see an organization which is conscious of its role in the community, supporting social needs and ensuring employment from within the local community.
We see an organization which is committed to the environment, using natural products and recycling items, thus ensuring proper use of diminishing natural resources.
Source:- http://www.oberoihotels.com/
CATEGORIES OF OBEROI HOTELS
Business Hotels
Oberoi Hotels & Resorts is synonymous the world over with providing the right blend of luxury, warm service and quiet efficiency. Internationally recognised for all-round excellence and unparalleled levels of service, the business travellers acknowledge Oberoi Hotels & Resorts as amongst the finest.
This was reaffirmed recently in Condé Nast Traveler, Business Travel Awards, a readers' poll of business travellers, in which Oberoi Hotels & Resorts was rated the best hotel chain in the world (outside the United States). The Oberoi, New Delhi, The Oberoi, Mumbai The Oberoi, Bangalore The Oberoi Grand, Kolkata
Leisure Hotels
Oberoi Hotels & Resorts is synonymous the world over with providing the right blend of luxury, warm service and quiet efficiency. Luxury as a unique, memorable and personal experience is core to the Oberoi philosophy. It encompasses every element of a guest's stay at the Oberoi hotels that creatively combine breathtaking locations, luxurious environs and the best of modern amenities with personalised and warm service delivered with genuine care. The design and architecture of the hotels, is inspired by the historical style of the region. This coupled with luxurious interiors that replete with local arts and crafts, to menus that offer an extensive selection of local specialties and classical and folk dance and music performances. The Oberoi Amarvilas, Agra The Oberoi Rajvilas, Jaipur The Oberoi Udaivilas , Udaipur The Oberoi Vanyavilas, Ranthambhore Wildflower Hall, Shimla in the Himalayas The Oberoi Cecil, Shimla Mena House Oberoi, Cairo The Oberoi, Sahl Hasheesh, Red Sea,Egypt The Oberoi, Bali The Oberoi, Lombok The Oberoi, Mauritius.
Cruises
Oberoi Hotels and Resorts offer unparalleled luxury cruise experiences, on the Nile and the Kerala Backwaters. The right blend of impeccable service, luxury and quiet efficiency, hallmarks of Oberoi Hotels & Resorts worldwide, make the stay onboard the Luxury Cruisers memorable. The Oberoi, Motor Vessel Vrinda, Kerala The Oberoi Philae, Nile Cruiser The Oberoi Zahra, Luxury Nile Cruiser
Spas
Oberoi Spas provide a serene and truly unforgettable experience of pure pampering and relaxation in exquisitely beautiful surroundings, using holistic therapies and massages which combine the very best of Eastern and Western practices. Expert in the use of Western & traditional Eastern techniques, only highly skilled and trained therapists are handpicked for our hotels and resorts. Oberoi Spa recipes feature only the finest natural ingredients, often local to the resort and the Oberoi Group are committed to remaining true to the Asian tradition of respect for the environment. The extraordinary levels of comfort and service that guests expect from Oberoi reach a peak in the Oberoi Spas, world-acclaimed pioneers of the tropical spa experience. The Oberoi, New Delhi The Oberoi, Mumbai The Oberoi, Bangalore The Oberoi Grand, Kolkata The Oberoi Amarvilas, Agra The Oberoi Rajvilas, Jaipur The Oberoi Udaivilas, Udaipur The Oberoi Vanyavilas, Ranthambhore Wildflower Hall, Shimla in the Himalayas The Oberoi Cecil, Shimla The Oberoi, Sahl Hasheesh,Red Sea,Egypt.The Oberoi, Bali The Oberoi, Lombok The Oberoi, Mauritius
Source:- http://www.oberoihotels.com/
SWOT ANALYSIS Of OBEROI HOTELS
Strengths
Cost advantage
Asset leverage
Effective communication
High R&D
Innovation
Online growth
Loyal customers
Market share leadership
Strong management team
Strong brand equity
Weaknesses
Bad communication
Diseconomies to scale
Over leveraged financial position
Low R&D
Low market share
No online presence
Not innovative
Not diversified
Poor supply chain
Weak management team
Weak real estate
Opportunities
Acquisitions
Asset leverage
Financial markets (raise money through debt, etc)
Emerging markets and expansion abroad
Innovation
Online
Product and services expansion
Takeovers
Threats
Competition
Cheaper technology
Economic slowdown
External changes (government, politics, taxes, etc)
Exchange rate fluctuations
Lower cost competitors or imports
Maturing categories, products, or services
Price wars
PRODUCT PROFILE
The group is committed to employing the best environmental and ecological practice in technology, equipment and operational processes. The Oberoi group also supports Philanthropic activities that range from education to assistance for the mentally and physically challenged. The group is also keen contributor to the conservation of nature and of cultural heritage.
DIRECT COMPETITORS:
•TAJ HOTELS
• ORIENTAL HOTELS
• ITC WELCOME GROUP
• HOTEL LEELA
POTENTIAL TARGET MARKET:
The upper class of the society is targeted, the richer people in the society. Their fares or tariffs are high as the luxuries provided by them are also standard and 5-STAR. This is in context to the Indian branches of Oberoi Hotels.
FUTURE PLANS OF THE OBEROI HOTEL
THE OBEROI has seen an organization which aims at leadership in the hospitality industry by understanding its guests, and designing and delivering products and services which enable it to exceed their expectations. We will always demonstrate care for our customers through anticipation of their needs, attention to detail, distinctive excellence, warmth and concern.
THE OBEROI see a lean, responsive organization where decision making is encouraged at each level and which accepts change. It is committed and responsive to its guests and other stakeholders.
Ø A more multinational workforce who has been exposed to different cultures, problems and situations and can use its experiences to enrich the local employees whether in India or overseas.
Ø The world dotted with hotels of THE OBEROI GROUP, in strategic commercial and resort locations.
Ø We see user-friendly technology enhancing value for our customers and helping our personnel by making information more accessible.
Ø An organization which is conscious of its role in the community, supporting social needs and ensuring employment from within the local community.
Ø An organization which is committed to the environment, using natural products and recycling items, thus ensuring proper use of diminishing natural resources.
STP (Segmentation Targeting Positioning) Of Oberoi Hotels.
Ø Segmentation:- Income And Lifestyle
Ø Target:- High Income And Luxury Living
Ø Positioning:- Luxury Hotels With Excellent Locations And Services
Marketing Strategy
- The luxury hotel brand – Oberoi Hotels & Resorts – is expanding its relationship with Rate Tiger. Oberoi Hotels & Resorts, which has recently extended the number of luxury leisure hotels in India, has been using Rate Tiger products since May 2007.
Source: - http://www.traveldailynews.com/pages/show_page/26371-Oberoi-continues-with-Rate-Tiger
- Oberoi Hotels and Resorts plans to unveil a luxury Nile cruiser in October this year. The Oberoi Zahra will have 25 luxury suites and two grand suites. The seven-day cruise itinerary includes private docking facilities in select cities.
- "The Oberoi Zahra will also be the only boat with four massage suites, each with an en suite steam and shower room, offering the opportunity of luxuriating in rejuvenating spa treatments. Additional facilities on the cruiser will include a theatre, library, swimming pool and a gymnasium," a release from Oberoi Hotels and Resorts said.
Source: - http://www.thehindubusinessline.com/2007/06/11/stories/2007061102600300.htm
• The Oberoi Group, Delhi, is close to signing a marketing and branding agreement with Hilton International, London, for its Trident brand properties.
Source: - http://www.highbeam.com/doc/1G1-97727058.html
PORTERS FIVE FORCES ANALYSIS
CUSTOMER NEED:
- GOOD HOSPITLITY
KSF'S-KEY SUCCESS FACTORS
• Technology Related: Used advance technology in hotel premises.
• Manufacturing Related: High utilization of fixed assets quality control know-How serving customer according to their specification.
• Distribution Related: Presence of hotel chain at various places. a strong network.
• Marketing Related: Breadth of a product line and product selection personalised customer services. A well-known and well respected brand name
CONCLUSION
Looking and studying and analysing the marketing strategies of Oberoi Hotels, Oberoi has achieved to be one of the best hotels in India and overseas by following these strategies. Due to these strategies they have sustained such a high position. Oberoi has a professional management and employees are well looked after each and every employee is quality conscious and believes in the motto 'service with a smile'. Oberoi group has been segmenting upper and upper middle class it is suggested that Oberoi group endeavour to bring in middle income group also with cliental by opening low cost hotels
Some suggestions are as follows:
Oberoi should expand and ensure its presence at every tourist centre of the world
Oberoi management should continue constructive hotels it has academic background displaying the rich culture and history of India.
Oberoi group should endeavour to recruit people to who had been trained at the Oberoi hotel or has studied hotel management it is one of the Oberoi affiliated hotel management institutes.
BIBLOGRAPHY
WEBSITES:-
- http://www.oberoihotels.com
- http://www.tajhotels.org
- http://www.incredibleindia.org/index.html
- http://www.scribd.com/doc/15966099/Hospitality-Industry-India
- http://www.itcportal.com
- http://www.yahoo.com
- http://www.slideshare.com
- http://www.scribd.com
- www.wikipedia.org
- www.avenuea.razorfish.com
- taguchim@hotelokura.co.jp
- ohr@hotelokura.co.jp
- http://www.emeraldinsight.com/fig/0410180203001.png
- www.zenithoptimediaindia.com/ringside3/April09/index_files/hotels_ms.gif
- http://www.brandchannel.com/
- http://www.crm2day.com/
- http://www.msi.org
- http://www.traveldailynews.com/pages/show_page/26371-Oberoi-continues-with-Rate-Tiger
- http://www.thehindubusinessline.com/2007/06/11/stories/2007061102600300.htm
- http://www.highbeam.com/doc/1G1-97727058.html
- FHRAI
- MAGAZINE:-
INDIA TODAY MAGAZINE
- BOOKS:-
Kotler, Bowen & Makens, (2009), Marketing For Hospitality & Tourism, 4th Edition, Pearson Education, New Delhi.
Armstrong, G and Kotler, P. (2007), Marketing: An Introduction 8th Edition, Prentice Hall, and NJ.
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