The travel industry is evolving. Every touchpoint in a traveller’s journey has paved the way for newer needs and countless options to meet the same. At OYO, since day one, we have been cognizant of these evolving needs and enhancing the experience of our guests and asset owners alike. From budget hotels to mid-market offerings, from offering a customized experience to our corporate guests or delivering unique experiences to travellers through our beautiful vacation homes – we are tirelessly working towards adding value to the experience of all our stakeholders. Opening the doors to our first vacation home was our way of answering a discerning traveller’s first and most pressing thought – what’s next? Globally, homes – be it vacation rentals or urban homes – present a massive opportunity for millions. Here, Europe has emerged as a significant market with its high supply share of 30-40%.
OYO Vacation Homes:
Early last year, with OYO Vacation Homes, we opened our doors in Europe with the promise of transforming guest experience and also strengthening our relationship with homeowners and enabling them with the resources required to deliver chic hospitality experiences. OYO’s capabilities across operations, technology, revenue management, transformation and design play a crucial role in fuelling our growth across categories, including the homes vacation rental business. Through multiple brands, including Belvilla, Dancenter, Danland and Traum Ferienwohnungen, we are now managing over 130,000 homes from Spain to Norway with over 35,000 homes under our full-service offering, and 90,000 homes in the online marketplace service.
We owe this success to the trust and confidence every homeowner has placed in our business and the capabilities and hard work of hundreds of OYO Vacation Homes team members, who are adding value to Europe’s hospitality landscape.
With a strong focus on strengthening our presence in Europe, we recently entered into a strategic alliance with Germany based e-domizil GmbH with the intention of acquiring TUI’s vacation homes tour operator business. This will enable us to significantly further scale our vacation homes business in Europe by adding over 17,000-holiday full-service homes to a total of 50,000+ units and increase our presence from 22 countries to 26 countries. We are strengthening our footprint in Germany, France and Italy, while entering into 4 new countries, as well as expanding our current base in Poland, Greece, the United Kingdom, Portugal, Norway, and the Czech Republic.
We are on a mission to drive higher yields for our homeowners
In a brief period of six months, our per home revenue has increased by 25-30% y-o-y (as against the minimal 2-3% YoY increment by other players), which has proved to be a crucial driver for steering a strong relationship with our homeowners. We are continuing our strong growth momentum with ~1.9x (MOM over December 19) increase in revenue in January 2020. On the customer side, we recently revamped the consumer website ‘Belvilla’ with a complete update of UI (User Interface) / UX (User Experience), intelligent search experience, and faster browsing and frictionless checkout experience. With the new website, we are witnessing a 20% increase in conversions, pages per session improved by 25% , improvement in load time by 20% and a 2.10% reduction in bounce rate.
We have further witnessed 4X faster growth in the business during this period, as we opened vacation homes in top travel destinations in France including the Bassin d’Arcachon, Vosges and Pyrénées. In January 2020, on average, we hosted over 6,500 guests every day across our beautiful vacation homes. We are overwhelmed by the trust and confidence that thousands of homeowners across Europe have demonstrated in OYO’s execution and revenue management capabilities. In addition, we further enable easy payments and dynamic pricing, so that these homes can be offered at the optimal price point that benefits both stakeholders; we provide enhanced digital experience; offer better engagement with guests through CRM; and, improve discoverability of these homes through our OTA partners, including Airbnb.
The secret sauce:
At OYO Vacation Homes, we are utilizing the power of data to understand our customers better. Carefully analyzing customer behaviour has given us insights that are significant for business growth. With the help of data analytics, we are able to solve some of the biggest hurdles faced by homeowners, for example, seasonality or low bookings during certain times of the year. It’s data that has helped us understand the impact of a swimming pool or sauna on the occupancy of a particular home. It is also data that highlights that pet-friendly homes witness higher occupancy!
The way forward: Doubling down our efforts on delivering value-driven homestay experiences:
We are proud that OYO Vacation Homes is the first vacation rental company that offers investments in vacation homes on a large scale. Identifying vacation rentals service business as a multi-billion Euro opportunity, we have committed to invest €300 million in the business. Additionally, we made some bold decisions, which included shifting our focus in Europe from hospitality to the vacation homes business. In the last year, we also realigned our organizational structure accordingly with the objective of running a sustainable business with a focus on financial prudence, and business economics. These are key for the company and our forward movement on the path to profitability.
Backed by a seasoned workforce and with a firm grip on local nuances, OYO is now witnessing a strong growth trajectory that is helping it maintain the momentum while delivering a high-quality experience to guests and increased yields for asset owners.
While still continuing to successfully operate over 100 hotels in Spain alone, our teams are tirelessly working towards expanding our presence across Europe to pursue the significant opportunity of becoming the largest home vacation rental company globally and the most loved brand. We have further committed to expanding our workforce in Europe in 2020 across functions, including business development, engineers, data scientists and property improvement. We will continue to engage with potential homeowners for which we are building a robust team of OYOpreneurs. In the last few months alone we have expanded our team by adding 300 exceptional professionals from various industries and institutions. Today, we are a 1,000+ OYOpreneur-strong team globally. We are positive that their rich experience and knowledge will contribute to the growth of OYO Vacation Homes in the coming months.
With over 130,000 homes, OYO Vacation Homes manages homes across 50+ countries. Today, more than 2.8 million holidaymakers from over 118 countries experience their holiday every year with OYO Vacation Homes. We have doubled our growth rate and outlooks for 2020 are even more positive. We are tirelessly working towards accelerating this growth even further in 2020, as we strengthen our presence across Europe and other holiday destinations.
At OYO, customer experience is of utmost priority to us and, hence, we take feedback seriously and constructively. We believe that when it comes to experience, there is always room for improvement and that can be achieved if you listen to customers carefully. With a razor-sharp focus on enhancing quality and adding value to the experience of our guests and homeowners, we will continue to put our heads down and execute. It’s always Day 0 for us.