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Koos Klien President (Middle East & Asia Pacific), Hilton Hotels Corporation

Koos Klien, President (Middle East & Asia Pacific), Hilton Hotels Corporation, is spellbound by the inherent potential of India and emphasises that, if backed by necessary infrastructure, few destinations will be able to compete with it

They say third time is lucky. And Hilton International is certainly hope that it’s true. It premiered on the Indian hospitality scene in 1995 with Bharat Hotels with a property in New Delhi, but the relationship lasted only two years. It later tied up with actor Sanjay Khan's spa, Golden Palms near Bangalore, which had an even shorter lifespan.

In its third attempt in 2002, Hilton International was in talks with Indian pharmaceutical company, Morepen Labs (now Blue Coast Hotels) for a joint venture with Hilton owning one third stake in three hotels in Mumbai, Bangalore and Goa. However, at the moment it lies dormant.

The game plan

Nevertheless, there is a lot of action in the Hilton stable. It has now inked an agreement with East India Hotels (EIH), promoters of the Oberoi Group of Hotels & Resorts. Also, the alliance between Hilton Oberoi in Mumbai and Trident Hilton Hotels in Gurgaon, Agra, Jaipur, Udaipur, Bhubaneswar, Chennai, Kochi and Mumbai that are slated to open by 2007, has set the ball rolling for the group's ventures in India.

Earlier this year, Hilton inked an agreement with two Bangalore-based companies: the Embassy Group to introduce Hilton Residences in India and Prestige Estates for another Hilton project, outside its alliance with EIH. Also on the cards is another Hilton project, a hotel plus commercial project in Hyderabad and the initiation of its mid-market brand Scandic by Hilton in India.

But in recent times the group is making news for a rumoured strategic alliance with DLF - one of India's leading real estate companies. Industry sources reveal that DLF is looking at tying up with the Hilton group for a considerable number of properties in the country, which would see Hilton being among the most visible international brands in the Indian market.

Pronouncing the group's regenerated interest in this market, Koos Klien, president (Middle East & Asia Pacific), Hilton Hotels Corporation, says, "India is one of the most magnificent tourist destinations in the world with a heady mix of experiences to satisfy domestic and international travellers. Some countries have to work hard to unearth reasons for people to visit. India doesn't have to." However, one thing that mars this advantage, Klien feels, is the infrastructure that needs substantial improvement, "starting with airports".

Among its other strategies, the group plans to introduce its 'Take Me to Hilton' campaign in India, specifically to boost business in its eight Trident Hilton properties. Klien says, "It is our belief that for a hotel to be fresh and contemporary, it has to move beyond the basics and offer a complete lifestyle solution for guests." Keeping in tune with this are its kids clubs, tailored for children between the ages of one to 15.

Commenting on technology initiatives of the group, Klien says, "Room nights booked via our websites globally grew by 94 per cent in 2004 largely due to introduction of our international brand websites, which achieved the full year's target in just over five months. Today, our websites represent seven per cent of our individual business, up from three per cent in 2003, with many more untapped opportunities to grow revenue. We will continue to invest in a range of marketing activities including search engine optimisation, email communications and online marketing campaigns."

On the horizon

With rapid growth in business and increase in outsourcing, Klien says, India is seeing a shortage of rooms in many of its second-tier cities like Hyderabad and Bangalore. "The market is opening up and creating opportunities for more international hotel brands and mid-market hotels to set up operations in these destinations," he adds.

This, he says, is caused by the emerging middle class and burgeoning domestic tourism. From Hilton's perspective, growth will come from a two-pronged approach: the upscale Hilton hotel and mid-market Scandic by Hilton brands. "We hope to have more of these in gateway cities that are hubs for MNCs as well as in places with leading cultural sites and tourist attractions," he adds.

Klien believes…

The hospitality industry, Klien believes, is cyclical in nature and demand in key metros and leisure destinations is outstripping supply, despite steadily increasing room rates. This burst of growth should continue for at least another year, if not longer, he thinks. "When compared with Europe, India is extremely affordable, especially for business travelers," Klien says.

As with other emerging economies, major metros led by Mumbai will become more cosmopolitan in outlook and changing consumer habits will see the setting up of various standalone bars and restaurants.

"The downside for hotels is that they risk losing their captive F&B audience as travellers become more confident of eating out," he says.

Klien also believes that there are distinct opportunities for growth in the MICE market in India, once the infrastructure improves.

He says, "Destinations must use what is already available to them in innovative ways. For example, the Hilton Beijing regularly arranges five-star banquets and string quartets under a full moon on the Great Wall. India is definitely ideal for smaller meetings and incentives as the destination has astounding scenery. So hosting a dinner for the heads of state in the grounds of the Taj Mahal or staging an evening celebrating jazz in the Red Fort would be an outstanding idea."