Presented by- Bidhu B Mishra

Indian Hotels Company Limited (IHCL)

Indian Institute of Tourism

and Travel ManagementNoida

Briefly introduce Taj Group of Hotels

• Indian Hotels Company Limited, branded as Taj Group, is a

chain of hotels and resorts.

• IHCL + its subsidiaries =Taj Hotels Resorts and Palaces and is

recognized as one of Asia's largest and finest hotel company.

• Headquartered - Oxford House in Mumbai,

• Incorporated by - The founder of the Tata Group, Mr. Jamsetji

N. Tata

• Founded- 1903

Introduction

Introduction

• Company opened its first property, The Taj Mahal Palace

Hotel, Bombay in 1903

• Taj Hotels Resorts and Palaces comprises 93 hotels in 55

locations across India with an additional 16 international

hotels in the Maldives, Malaysia, Australia, UK, USA, Bhutan,

Sri Lanka, Africa and the Middle East.

Introduction

• IHCL operate in the luxury, premium, mid-market and value

segments of the market through-:

• Taj - (Luxury full-service hotels, resorts and palaces)

• Taj Exotica – (Resort and Spa brand)

• Taj Safaris - (Wildlife lodges)

• Vivanta by Taj Hotels & Resorts

• The Gateway Hotels & Resorts

• Ginger - (Economy hotels)

• Taj Hotels also promise a whole new experience of tranquillity and total 'wellness', through Jiva Spas

• IHCL operates Taj Air, a luxury private jet operation with state-of-the-art Falcon 2000 aircrafts designed by Dassault Aviation, France

• IHCL also operates Taj SATS Air Catering Ltd., the largest airline catering service in South Asia

• Additionally, it operates the Indian Institute of Hotel Management, Aurangabad since 1993

Explain to Discuss How IHCL has Positioned Itself in The Budget Category Without

Diluting the Image Of its Flagship Taj Brand ?

IndiOne ?

Roots Corporation Limited (RCL) is a wholly owned subsidiary

of the Indian Hotels Company Limited (IHCL). Incorporated in

December 2003, RCL operates IndiOne, a first-of-its-kind

Smart Basics hotels across the country.

The Smart Basics hotels from the Indian Hotels Company

Limited (IHCL) have been named Ginger. The first of the Smart

Basics hotels was launched in Whitefield Bangalore and was

called indiOne

Why IndiOne ?

The primary objective behind the launch of indiOne is to

provide a superior product offering and consistent experience

to travellers, far beyond the present offerings in the industry.

indiOne caters to corporate executives, traders and self-

employed professionals, tourists, pilgrims and leisure

travellers who are looking for a clean, secure, convenient

hotel, without having to pay premium prices.

Developed in association with renowned corporate strategy thinker, Dr CK Prahalad, the indiOne hotels are designed to be functional, while providing an extremely comfortable, clean and safe stay at an affordable cost. 'Smart Basics' a new category of hotels, signifies simplicity, convenience, informality, style, warmth, modernity, and affordability.

• Strong sales and marketing• Innovative product ideas• Maintaining high service standards• Creating a talent pool of people

Initial Problems• The venture was not under the Brand name of Taj.• After stripping features in the services and cutting cost, they

cannot go below Rs. 2500.• It was not a competitive price for the Budget Segment.

Strategic Move

• They took the assistance of Dr. Prahalad.

He suggested the bottom – up approach to arrive at a price

and the service offering

• They surveyed managers, salespersons and business travelers

of mid-sized companies

• This gave them a fair idea of price range i.e. Rs. 1000/room

Strategic Move

• Each hotel was built in the area of 1 acre with 100 rooms.

• They budget of each hotel was marked at Rs. 100 millions

which means Rs. 1 million/ room.

• This was comparatively far lower than the investment of Rs. 5

millions – 15 millions / room in developing five star hotels.

Strategic Move

• Size of the room was kept small- around 180 sq. ft. as

compared to 250- 400 sq. ft. of premium segment hotel.

• The company cut down room service and applied the concept

of “Help Yourself”.

• This concept helped in operating the hotel with 25 people as

compared to 250 people in premium category hotel.

Pricing

• Single Room Charges- Rs. 900

• Double Room Charges- Rs. 950.

• The customers were entitled to a discount of Rs. 50 if booking

is made through internet.

• This practice helped to cut their marketing costs which

contributes to 10% -15 % of room costs.

Special Offers

• Early Booking Offer:- “SAVE NOW” Book Early and Pay Less.

• Last Minutes Rates:- Sensational last minutes rates in their top

destinations.

• Day Use Rates:- Introducing special day use rates for travelers

to freshen up or relax before heading to work.

• Coolest Offer Packages:- Visit most popular destination

starting at just Rs. 2799/- onwards.

Facilities Ginger’s facilities and services are intelligently designed for

customers comfort and convenience. It provides:-

Choice of single, twin, and queen-sized rooms Individually air-conditioned Electronic locks, Wood laminate flooring Comfortable beds A work area, A 17-inch flat screen colour television with

satellite channels,

Facilities

Direct-dial telephone including STD facility Mini-fridge, tea / coffee maker 24 hours hot / cold water and toiletries The indiOne hotel also has a restaurant Meeting room Gymnasium facilities A cyber cafe, 24-hour reception ATM, digital safe deposit boxes 100 per cent power back up

Wi-Fi connectivity

Booking System

• It provides a toll- free number1860-266-3333 to book over phone

• Payment Options-:American Express Card.Master Card / Debit Card.Visa credit/ Debit Card.Net Banking.

• Facility of group booking is also available

Corporate Advantages

• Optimizes costs:- Enjoy special customized rates

• Enjoy exciting facilities

• Convenience and peace of mind:- suitable location, rooms are

hygienic, peaceful & comfortable.

• Consistency:- Uniform standard in services

• Hassle free reservations

• Transparency in booking process

• National Contract

Global Trends

• Enjoy unmatched blend of comfort and economy &

convenience in India

• According to global study, international travelers are

increasingly concerned about their safety while choosing

hotels, so Ginger ensures stringent checks

• The Ease of the internet for booking solutions and customer

can also get SMS and e-mail updates of every transaction

Strategies Adopted By Ginger Hotels

Meeting room for Corporate

Banquet halls

Gymnasium facilities with Certified Trainers

Hotels in Malls

PPP models - Yatri Niwas

State What The Potential Opportunities That

Companies Have in Serving The Population at

‘The Bottom Of The Pyramid’.

Explain The Concept Also ?

‘The Bottom of The Pyramid’

• “Bottom of the Pyramid” (BoP) was first used by

U.S. President Franklin D. Roosevelt in 1932 while he was

talking about « the forgotten man at the bottom of the

economic pyramid .

• In economics, the bottom of the pyramid is the largest, but

poorest socio-economic group. In global terms, this is the 4

billion people who live on less than US$2.50 per day

Technically, a member of the BOP is part of the largest but

poorest groups of the world's population(4 billion people ),

who live with less than $2.50 a day and are excluded from the

modernity of our globalised civilized societies, including

consumption and choice as well as access to organised

financial services.

The phrase “bottom of the pyramid” is used in particular by

people developing new models of doing business that

deliberately target that demographic, often using new

technology. This field is also often referred to as the

"Base of the Pyramid" or just the "BoP".

PRINCIPLES OF INNOVATION FOR BOTTOM OF THE PYRAMID MARKETS

Focus on price performance. Hybrid solutions, blending old and new technology. Scalable and transportable operations Eco-friendly products. Build logistical and manufacturing infrastructure. Educate customers in product usage. Products must work in hostile environments: noise, dust,

unsanitary conditions, abuse, electric blackouts, water pollution.

Adaptable user interface to heterogeneous consumer bases. Distribution methods Focus on broad architecture,

Strengths of Bottom of The Pyramid Thinking, Benefits

• There is money at the Bottom of the Pyramid: it is a viable market.

• Access to Bottom of the Pyramid markets is not necessarily difficult. Unconventional approaches such as the Avon ladies approach may work.

• The poor are very brand-conscious.• The Bottom of the Pyramid market has been connected

(mobile phones, TV, Internet).• Bottom of the Pyramid consumers are very much open

towards advanced technology.

BoP economic potential may be underestimated because of four main

misperceptions of poverty • Income is too low, the poor can’t buy MNCs’ products.

• Goods sold in developing markets are so cheap that MNCs

can’t make reasonable profit.

• The poor don’t waste money on luxury products, they only

fulfill basic needs.

• The poor don’t have the required skills for the use of

advanced technology.

• To influence its‟ brand to grow inside the same business

focusing on another and so far undiscovered section or extend

in the neighbouring administration commercial enterprises

where it can power its impressive aptitude and wide

contrasting features.

• Taj into the top of the line restaurant business make an

extraordinary vital fit

Advantage and Opportunities• The WTO (World Travel Organization) predicts that India will

receive 25 million tourists by year 2015. • Stable and consistent growth projected • India currently has over 200,000 hotel rooms spread across

hotel categories and guest-houses and is still facing a shortfall of over 100,000 rooms

• India to become a major hub for medical tourism, with revenues from the industry estimated to grow to US$ 2.2 billion by 2012,

• India will add almost 114,000 hotel guest rooms to its inventory over the next five years.

• There are 41% middle affluent class in India. It is predicted that Luxury market is to expand in India so the company should target this segment

• The emerging market – Budget & Business Hotels

• Better infrastructure and air connectivity

• More international brands and large domestic players

entering the fray

• Shift of focus away from the metros into Tier I and Tier II cities

• 29 Mega Tourism projects across 22 Indian states

• Investment in smaller cities

• Hospitality chains looking upcountry

• Emerging need for a suitable project mix

• International hospitality chains are expected to acquire local

players to increase their presence in the country.

• More room for strategic alliances and partnerships

• All players are looking at faster turn around times

Advantages & Opportunities

• GREEN Technology is the in thing

• Diversification into new segments

• All hospitality chains local and international are now

diversifying into new product segments

• IHCL has already launched budget hotels in India, while Accor

has announced similar plans

• High quality expectations and need for more innovation and

eco-friendly solutions are also driving hotel operators to look

for options elsewhere