This winter holiday, more and more Indian travellers seem to be chasing cheap chills. Hotel chain and room aggregator OYO has seen a 104% rise from the last season in bookings for hotels in cold destinations, like hill stations Mussoorie and Shimla. Reservations in warm destinations—Goa, Puducherry—are up 66%, according to data provided by OYO.
But it remains to be seen if OYO’s growth is sustainable.
“Traditional hospitality groups like Mariott and Taj are now getting extremely aggressive in terms of partnerships, pricing, and offers. So OYO is now treading into a bit of traditional territory of hotels—which is not clearly their expertise,” said Sanchit Vir Gogia, the founder and CEO of Greyhound Research.
“So they’re burning a lot of money and time. That’s not going to be a problem today, but that’s clearly going to be a problem a few quarters down the line, because they will be impacted by (the) increase in operational spend,” Gogia said.
In the long run, he added, “Their success may be highly questionable.”
Sanchit Vir Gogia: Sanchit is the Chief Analyst, Founder & CEO of Greyhound Research, a Global, Award-Winning, Technology & Innovation Research & Advisory firm. To read more about him, click here.
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