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Executive Interviews: Interview with Parvatha Kiran on Bottom of the Pyramid
November 2008
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By Dr. Nagendra V Chowdary
- Human Resources will play a key
role going forward as there will be a
severe shortage of manpower as the
industry expands in a big way in
India and across the globe.
- Process driven approach as
opposed to adhocism will drive the
industry. Relationships will be passe.
- Electronic Distribution Channels
(EDC) will play a key role. EDC
already is on a high growth path.
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- Big brand names with a multiple
offering will be the dominant players
in the landscape.
- The business would get
competitive leading to consolidation
in the marketplace.
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With increased urbanization, new
foreign players entering, and the
existing hotel chain groups adding
up capacity, what is your
assessment of Indian hotel industry
in the coming five years?
Price rationalization: the general
impression gaining ground is that the
hotels in India are overpriced with
the demand/supply imbalance in
favor of supply. The customer will
once again be the king with better
negotiation power leading to price
rationalization. The foreign chains
need to understand the Indianmarket
better, the strength of Indian chains is
the sales force and the foreign chains
need to understand the way Indian
business is handled. The Indian
market is set to see a multiplicity of
offerings a varied bouquet from mid
market to high-end luxury. This will
again improve the quality of hotels
and rationalize the prices. -
What do you understand by BOP
markets and BOP customers? What
are the defining characteristics of
these markets and the customers?
Every industry has a multiple
product offering. Unfortunately so far
in the hotel industry the BOP offering
was not well defined and was
restricted to the unbranded
standalones. Hopefully this will
evolve over the years with branded
and well defined product offerings in
the years ahead. This will see the
maturity of the product offering and
once again give a value offering to the
guest. The customers in this segment
are looking for a value for money
proposition and no frills, the "do it
ourselves" concept rather than having
things done through elaborate service
designs. Products would also get
defined as they move along for this
segment as hotel chains understand
the large volume of business in this
segment. The fine definition of
product design would be by way of
different sets of products for different
needs ie., the leisure product would
be different from that of a business
location. -
One of the trends thatwe see of late
in the Indian hotel industry has been
the emergence of budget hotels with
distinct value propositions. Are
these budget hotels a part of tapping
the bottom of the pyramid market? If
yes, what changes do you envisage
in the value proposition? Who are
likely to be the target customers?
Yes, these budget hotels like Ginger or
Hometel are the industry's answer to
tapping the huge unstructured
market that exists. It is all about
defining these markets and reaching
out to these markets with welldefined
product offerings. The value proposition would be
driven around neat, clean and safe
places to stay in with families which
are from trusted and branded
corporate houses, mildly redefined as
"5 Star lodges." The customer gets
value for the money and it is easy on
the pocket. The target customers would vary for
the different markets. Leisure
destinations like Goa would look at
more of the family vacationers, while
business destinations or metros
would look at a mix of families and
the emerging business travelers.
1.
Bottom of the Pyramid Consumers Case Study
2. ICMR
Case Collection
3.
Case Study Volumes
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