Hotels

It's all in the brand name

Sunil Mathur Head (development), India & Middle East, Cendant Corporation

With its diverse portfolio and constant evolution, Sunil Mathur, head of development for India & the Middle East, Cendant Corporation puts the Indian hospitality market into context. He believes that the expectation today is of a branded product that exceeds expectations in terms of both value and price

Cendant Corporation has, over the years, made its presence in the country through its brands Ramada, Travel Lodge, Days Inn, Howard Johnson, Galileo GDS, RCI Times Share and Gulliver Travels that span across the hospitality and travel spheres. But Sunil Mathur, head (development), India & Middle East, Cendant Corporation, says that the group now wants to focus on the Indian hospitality market with full force.

The group already has an alliance with Advani Hotels, Days Inn India and Howard Johnson India for three of its hotel brands - the Ramada, Days Inn and Howard Johnson, respectively. These alliances allowed the firms to franchise and develop the brand in the Indian market. Its vacation ownership company RCI has also emerged as a success in the time-share segment with over 80 resorts under its umbrella after initially facing stiff criticism and apprehension in the country.

The game plan

Internationally, hotel profitability is increasingly the result of sound revenue and cost management and that is where Cendant plans to stay a notch above the rest. "I see a greater role for Internet in our industry than the one it is currently playing. It allows a hotel to reach out to a much larger consumer population at the least possible cost," explains Mathur.

Cendant Hotel Group International identified IT in hospitality early on as a key thrust area. "Add to that the wide international reach through RCI, Hotel Dynamics, Travel Services and we have very large numbers to harness," says Mathur. Adding to this he says, "At Cendant, our marketing promise encompasses high-quality rooms, bed and breakfast as essential elements at any of our hotels. Our guest focus programme called ExCEED is a trendsetter in the business."

On the horizon

With the evolving mid-market segment in India, Cendant is keen on bringing the brand Ramada Encore into the country with 20 properties slated to be operational by the year 2007. In the first phase, the group is looking at metros like Mumbai, Delhi, Bangalore and Chennai, while in the second phase, it will look at tertiary cities of Jaipur, Hyderabad, Goa, Ahmedabad and Kochi. The group is currently in talks with international and Indian real estate companies as well as hotel developers.

Moreover, the former Indraprastha property in New Delhi is soon to be rechristened Ramada Plaza after its owner R P Mittal of Mittal Ispat, and Cendant Corporation ink a franchise and international marketing support agreement.

Speaking on the growth potential of the Cendant group in the Indian market, Mathur states that the country possesses a promising future for hotels. He says, "By and large, our demand is higher than supply in most cities with new demand being created at new price and product levels. These include the burgeoning mid-range sector and sub-segmentations within that, apartment hotel option, limited service hotel option, highway motels and the like."

Mathur believes…

He feels that mid to upscale hotels will provide a tremendous amount of opportunity for the industry. "We therefore see ourselves to be doing the right thing at the right time. The hotel business today is led by speedy electronic reservation systems, global sales distribution and multi-level linkages with other components of the travel trade. We believe our leadership in these areas places our hotels at a distinct advantage," says Mathur.

Commenting on whether the group expects the mediation of the Indian government in providing an impetus to the hospitality and tourism sector, Mathur, asserts that he does not forsee an increasing government participation. "Their role will really be to facilitate growth so that the industry flourishes leading to cascading short-term and long-term economic benefits," he adds.

Both metro and non-metros cities will see exponential growth in India. The consumer boom is all pervasive; the general economic growth is ushering better products. Says Mathur, "While studying economics I have learnt that as a society's disposable income grows, its demand for goods is soon overtaken by the demand for services. This is what is happening in India right now and will continue in the future. We are living in times where customers prefer branded products."

He goes on to say that established brands provide international class management technology and superior image in a competitive market. "Chain affiliations are catching up too. It is not really new since almost all leading industry players including Oberoi, Taj, ITC and ITDC have had international brand affiliation at different times. Unlike in the past, modern hotel owners have better exposure and often have staff that is young and professionally trained," he says.

Mathur brings the conversation to a close with his forecast for the industry. He says, "World over, hotels tie up with international chains because they consciously want the force multiplier factor to retain their property ownership while still acquiring the chain advantage. I believe that future growth in hotels will be led by brands."