Business Model Innovations: Going above and beyond
With our innovative business model, we are creating quality accommodation for over 3.2 billion middle-income people in the world. We have brought about a positive change in fragmented and unorganized markets where there is a huge gap between demand and supply of good quality hotels by:
- Putting our skin in the game:
As highlighted already, we invest in the asset alongside asset owners to offer end-to-end solutions and support. Right from offering free design consulting to upgrading and transforming the infrastructure of hotels, to providing easy access to financing solutions, transparent payment protocols, multiple touch-points to connect, marketing excellence, tech innovation and regulatory compliance assistance, our focus continues to be on generating high yields for asset owners along with offering excellent customer service.
Our deep renovation capabilities have empowered us to add up to 80,000 exclusive keys to our chain every month at a global level. With this, we have set a new benchmark in transforming and renovating assets in a record time of 3-14 days and on-board them at an even quicker pace — a stark contrast to the industry standard of up to 90 days. To make this seamless, we have introduced a transformation app that enables OYO teams to understand the transformation requirements of a property while giving cost estimates and budget in addition to assigning tasks and tracking the pace at which the process takes place. It also enables the overall visibility of the TR process to all respective stakeholders.
With a 1,300 OYOpreneur-strong team of civil engineers and designers, we have powered the transformation of over 23,000 buildings across territories while promoting sustainable infrastructure in the hospitality sector. We utilize AI-led design approach while evaluating guest feedback and identifying their most-preferred designs. Our efforts are supported by in-house design labs – OYOXDesign and Townhouse Design Team. Our full-scale, capability-led model allows us to undertake a 360-degree transformation and renovation while upgrading the existing structure of an asset – from flooring, plumbing, air conditioning, painting, electrical fixtures to utility upgrades.
- Applying state-of-the-art and innovative hotel-tech to our hotels across the globe:
Technology is deeply embedded in our DNA and we are the first company in the hospitality sector in the world to introduce technology-based solutions on the suppliers’ side to help them manage end-to-end operations right from onboarding, transformation, customer service to monitoring progress of the asset and the business. As an intersection of real estate, hospitality, and technology, we have 20+ technological products that power these business verticals. This in-house and completely mobile hotel technology platform is easy to use and can be customized to help every asset owner manage their assets in the best possible way and offer excellent customer experience, leading to high yields. OYO OS, our in-house hotel management system ensures efficient operations. Every hotel which is a part of OYO’s chain works on the OYO Operating System, giving them a cutting-edge advantage with sophisticated features, including express check-in, check-out. Krypton – OYO’s mobile audit app – enables OYO Captains (Manager) to audit properties and assure an excellent guest experience. During the initial years, audits were done physically that limited the number of rooms and hotels that are being audited. Now, with Krypton, a single OYO Captain is able to manage the audit of over 300 rooms while improving the guest experience at the same time. Optimus – a dedicated transformation app enables our on-ground teams to understand the transformation requirements of a building while giving cost estimates and budgets in addition to assigning tasks and tracking the pace at which the process takes place. Insights from Optimus enable a strong on-ground team comprising civil engineers, architects and designers to transform an asset within 3-14 days and on-board them at an even quicker pace, which is in stark comparison to the industry. The in-built CO-OYO app helps asset owners monitor progress and access payment-related information in one place. Through the Co-OYO app, asset owners can have complete visibility on cash flows, business performance, pricing, customer reviews and recommendations. The app includes advanced analytics, which enables a deep dive into asset performance over time, intuitive interface that is easy to navigate and make decisions regarding value-added services, boosting performance by providing insights and easy-to-understand metrics and graphs that allow daily monitoring of performance.
- Introducing world-class pricing and revenue management techniques that help increase hotel rev par within 2 months of partnership:
With our focus on generating high yields for asset owners on assets that were either lying unused or operating at standards that are not at par with the industry, we introduced dynamic pricing to drive the best pricing mechanism in the industry supported by advanced Machine Learning and AI tools to ultimately optimise for best outcomes for customers and hotel owners alike. It enabled us to create a level-playing ground even for an independent or small hotelier. With this, we are also able to deliver predictable and affordable tariffs to our customers because we can reduce our cost of operations significantly (while fixed costs remain undeterred) when compared to traditional hotel companies, through the use of technology, superior talent and by leveraging our competencies that come with scale. Our pricing, inventory allocation, and revenue management are driven by a Machine Learning-based algorithm for prediction and dynamic pricing. The algorithm makes 60 million micro-optimizations, every day, to arrive at the optimal price point that ensures an affordable stay for our guests while driving higher yields and occupancy across 23,000 buildings that are a part of OYO’s chain. It allows each hotel to drive max RevPAR based on its micro-location. It allows pricing to adjust dynamically to supply and demand and while in peak times pricing adjusts to deliver high RevPAR, in low times, it also goes down to still allow for maximum customers to experience the product while increasing profits for owners. It is a boon for customers and core to the success of our business model worldwide. OYO’s pricing model, unlike traditional hotel chain models, is dependent on ensuring higher yields and occupancies to hotel owners, which leads to a better and sustainable value proposition for them throughout the year, which enables our hotel owners to offer high customer delight at an affordable price point.
Technology Innovations: First Hospitality Company to Invest in Technology
Technology is core to OYO’s growth and is a competitive advantage for us in the global hospitality industry. We are the first hospitality company in the world to invest in innovative and advanced technology to offer excellent customer experience and drive a sustainable business for asset owners. We use innovative technology solutions end-to-end to facilitate standardization of services, amenities and in-room experience, thereby helping maintain service standards. This is further enhanced by the diverse talent that includes people with a design background, tech experts, and more.
We have an in-house stack of proprietary technology powering 20+ applications for all our stakeholders, including customers, asset owners and employees. Backed by 400+ micro-systems and 1,000 full-stack engineers spread across multiple locations, we are able to deliver a consistent and standardized experience to travellers. We are using the latest set of open source tech, including Kafka, Springboard, Kuburnetes, Prometheus, Zabbix, among others. Our entire infrastructure is hosted on cloud, which is a rare scenario in the hospitality world where even now, hotels are being run on archaic technology. We are harnessing the power of the cloud to avail capacity on-demand, optimally tuned to serve customers in a way to provide the best user experience while keeping a check on costs. Our entire stack is Java J2EE based one. The team is building systems in a much more extensible manner to handle scale. We’re using Machine Learning for dynamic pricing while AI and NLP (Natural Language Processing) are helping in customer services. IoT is a big area for us where we are experimenting with smart switches and smart lighting to significantly improve the guest experience. This pilot is helping us determine ways to save electricity, enable unassisted check-ins with smart locks as well as determine guest room temperature and lighting preferences that can be activated pre-check-in.
Technology and app that enable great customer experience:
- Every aspect of OYO’s ecosystem is powered by technology. We have a global and industry-first proprietary hotel management system called the OYO OS. Every hotel which is a part of OYO’s chain works on the OYO operating system giving them a cutting-edge advantage with sophisticated features, including express check-in, check-out. It further allows for the online procurement and inventory management. The Krypton App is used by OYO Captain to audit properties and assure an excellent guest experience. The renovation and transformation process of our hotels is powered by OYO Optimus. The dedicated transformation app, helps our teams understand the transformation requirements of a building while giving cost estimates, budget in addition to assigning tasks and tracking the pace at which the process takes place. We are able to transform a hotel within 14 days with the help of the insights Optimus churns out.
- From a customer experience standpoint, data science and analytics help us improve the guest experience at every step. Through AI and Machine Learning, we look at multiple metrics from time of day, weather, location to local events, to be able to learn more and more about what kind of a room a customer prefers, and what are the search results the customer is most likely to appreciate. Data science and Machine Learning help us understand guest behaviour – both preferences and implicit behaviour, how they interact with our search results and app and the interactions they carry out while staying at our hotels. We have also pioneered tech for safety with the launch of in-app SOS button feature that will enable a guest to intimate OYO Safety Response Team or the Police about any emergency leading to fast action and resolving the issue. The In-App SOS button feature is a step forward in our commitment to ensuring guest safety and experience and has been designed by leveraging our tech expertise.
- We also recently launched a lighter version of OYO consumer app (globally) – OYO Lite. It has been designed to work in low connectivity areas or low networks to enhance the user experience. With OYO Lite, we aim to optimize the user experience on low network conditions keeping size constraints a priority. With a size of less than 800 KB, OYO Lite app consumes less space while offering an optimized user interaction time and a seamless experience no matter how connected the user is. We also introduced multilingual support on the customer app and mobile web platforms in languages like Hindi, Bahasa, Vietnamese and Arabic to offer a hassle-free and customized booking experience to millions of users across the world.
Technology and app that support asset owners:
- Along with the above technology-enabled operational capabilities that ensure hassle-free onboarding, transformation, renovation and customer service, we also have an in-built CO-OYO app that helps asset owners monitor progress and access payment-related information in one place. Through the Co-OYO app, asset owners can have complete visibility on cash flows, business performance, pricing, customer reviews and recommendations. The app includes advanced analytics, which enables a deep dive into asset performance over time, intuitive interface that is easy to navigate and make decisions regarding value-added services, boosting performance by providing insights and easy-to-understand metrics and graphs that allow for daily monitoring of performance.
Investments in tech talent:
We are proud to have top 1% of the world’s engineering talent with us at OYO contributing to our mission of upgrading all forms of real estate and thereby enabling middle-income travellers and city dwellers to experience #LivingTheGoodLife. We have 1,000+ full-stack engineers who are behind building OYO’s proprietary technology. We are creating proprietary technology in a matter of weeks to ensure that we stay agile while powering tech-enabled hospitality. One of our key development centres in Hyderabad, India, is helping us further consolidate our technology stack. The facility will focus on the development of innovative products that can effectively serve customers, partners and employees. Our acquisition of AblePlus added to our IoT capabilities that are being piloted across our hotels. Going forward, we plan to expand our team at Hyderabad development centre and have 650+ engineers in India. We are also looking at additional teams for Supply Chain Technology and Transformation Technology in Hyderabad. We have launched multiple tech centres in India and seeing the exceptional growth trajectory of OYO, we will ramp up our technology prowess by taking the count of our technology team to 2020 engineers by the end of the year 2020. We are hiring across functions including Machine Learning, Business Analytics, Data Science among others.
Localization: Innovating to find a place in the country’s social fabric
We started on the belief that everyone deserves a beautifully designed, chic and comfortable living space. And everyone deserves a better life. We knew we could change the way people live. We did that by upgrading bland, generic spaces and places and designing them with next‐gen chic and design moxie and offering them at hard‐to‐ignore prices. With this motto, we expanded across the globe and are now found in more than 800 cities in 80 countries with 23,000+ hotels and over 1 million rooms. This expansion has been backed by sound research and localization of our innovative model to meet the requirements of travellers and asset owners and sync well with the local culture, traditions and trends.
We understand that each market is unique, hence we localize everything from product experience, technology, interiors of our buildings to our overall approach. We invest heavily in capacity‐building and sustaining across markets with a highly localized approach which is an advantage. Our teams across international geographies observe local nuances with respect to the hotel industry in each of the countries we are present in which help us in highly localizing and personalizing the experience for our guests.
For instance, as we introduce new geography, we can integrate with the local payment instruments with the least amount of effort. In India, cash is the most preferred mode of payment and digital payments are catching up, but in China, our customers use WeChat app or Alipay, while in Japan, credit and debit cards are used more frequently. Our technology infrastructure handles all such localisations while ensuring that security is optimum and the transaction cost is the least. Further, localization is applicable across the app and web experience, including the language, currency, time zone and how the users from particular geography want their experience to be. For instance, In China, users prefer all the information regarding hotels right at the home page but in India, our users expect a neat home page with distributed information. Data analytics and AI are helping our interfaces become more intuitive to country-specific as well as individual requirements. We have also provided multilingual support on our customer app and mobile web platforms for a customized booking experience – Hindi in India, Bahasa in Indonesia, Vietnamese in Vietnam and Arabic in UAE.
In the Philippines, as the country has a lot of devout Christians, our hotel rooms keep a copy of the Bible in the drawer or on the table in the rooms for guests. In Indonesia, Islam is the most adhered to religion hence, our hotel rooms have the Qibla sign also known as Arah Kiblat in the local language Bahasa. The arrow sign signifies the direction in which the daily prayers should be offered. As Malaysia hosts a lot of Indian tourists, the hotels provide information on the nearest Indian/South Indian restaurants as the country has several dosa points. Moving West, in the U.K., the majority of the hotels have tea making facilities readily available for guests. This is unlike what hotels offer in other international markets. Traditionally, all hotel rooms will also contain a copy of the Bible.
We have also built exceptional local leaders and teams. Our management team in each international market brings very strong execution skills. We are proud to have a robust, resilient and diversified group of leaders, that have stood by the organization and personified distributed leadership, the key to OYO’s fast-paced growth and success.