Aggregator to Operator

OYO’s big Townhouse bet

With its new brand, OYO is becoming a bit more like conventional hotel chains. Does it have what it takes to succeed?

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In December 2016, OYO, India’s largest budget hotel aggregator, announced yet another change to its business modelan entry into fully managed hospitality through a new brand, “Townhouse”. And it was a complete departure from OYO’s strength: budget hotels.

On paper, the new business model is one of the oldest in the business. OYO plans to lease existing hotels and guesthouses, refurbish them and then operate them itself for a few years. The owner of the hotel gets a hefty guaranteed fee and additional revenue share. While OYO hires the staff, runs the hotel and manages customer experience.…

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