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Oyo’s Next Master Strategy To Rule Hospitality Market

| Published on April 9, 2019

In today’s age, there is a new start-up launching almost every day but not all climb the stair, some fall off midway while some give up on the struggle. For a start-up to grow and expand, it needs to have a solid plan and a unique strategy. Exactly what is being followed by the budget hotel start-up Oyo Rooms.

As part of its strategy to become a full-fledged hospitality chain, Oyo Rooms is planning to build its own cloud kitchen brands. The company, Oravel Stays Pvt. Ltd., is also eyeing to list the brands on food delivery platforms like Swiggy and Zomato.

What is the recent strategy?

A person familiar to the company’s plan said that food will form an ancillary revenue stream for Oyo and that they have been experimenting with different modes for a while. Earlier, the company used to have tie-ups with multiple restaurants, but now they are building their own food brands, which will be served to guests and also delivered (at home).

Currently, Oyo is under the Adrak brand and via it runs its first cloud kitchen. There were reports in February stating that the company was in talks to buy a significant stake in cloud-kitchen start-up FreshMenu so that it could enter the online food delivery business. But, current reports reveals that Oyo is building its own cloud kitchen brands, rejecting the past reports.

Aiming for the stars..

Oyo’s entry into the food space comes at a time when the company is flush with funds and has been slowly venturing into different verticals-including home rental, co-working and co-living segments, besides its hotels and townhouse offerings.

Oyo recently had raised around $1 billion from a clutch of investors, including SoftBank Group Corp., Grab Inc., and Didi Chuxing. More recently, it raised $150-200 million from Airbnb Inc., the world’s largest home-sharing platform, as part of its Series E round.

Oyo’s plan to add food as a category is to increase the business for its hotel partners, apart from acting as a full-fledged hospitality brand. Oyo spokesperson in an emailed response said that being the country’s largest hotel chain, Oyo does have an active play in the F&B business with an average of about 25% of revenue coming through the kitchens they operate in some of their hotels.

Well, we want to wish this hotel startup All the best for its new venture and await some good news in the near future!

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