Oyo's massive bet on its Townhouse brand

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

OYO is becoming a bit more like Sarovar, Marriott and IBIS

With 100 Townhouses planned, will it be the tail that wags OYO?

The business traveller segment is set to go to $90 billion by 2030

OYO now wants to be known as a premium brand with budget properties

In December 2016, OYO, India’s largest budget hotel aggregator, announced yet another change to its business model—an 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.

AUTHOR

Patanjali Pahwa

Patanjali has spent over seven years in journalism. He last worked at Business Standard as Principal Correspondent, where he wrote on startups, e-commerce companies and venture capital. He has worked at an array of institutions, which include Forbes India, Caravan and Outlook Business. He is a Mumbaikar, born and brought up. Patanjali did his BSc in IT from Mumbai University and then got his journalism degree from IIJNM in Bangalore. He is enamoured by Ernest Hemingway and Tom Waits and may try to sneak in references to them in his stories.

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