Acknowledging a company's shortcomings is a first step toward fixing them. But Oyo will really have to transform its practices if it has any hope of mending relations with hotel owners, some of whom feel burned.
As Oyo hotels tries to regain its footing coming out of the coronavirus crisis, it is making a variety of business model and strategy shifts in markets such as India, the United States, and China.
Oyo founder and CEO Ritesh Agarwal discussed these changes, as well as the pain of restructuring, and his outlook for the company’s business in these three important markets during a discussion Friday with Skift founder and CEO Rafat Ali on his The Long View livestream.
Agarwal said in some markets the economy hotel chain has done well by partners but not in customer experience, in others it has provided a great customer experience but has fallen short for partners, and in other geographies, the company could have done better for both parties.
In India, where some partners have been angered by accounting reconciliations, Oyo has extended the consultation period, and trained business development managers to talk directly with owners instead of Oyo accountants.
In the United States and China, Oyo has made adjustments to its prior policy of aggressively offering minimum revenue guarantees because asset owners’ interests and Oyo’s were at times “not fully aligned,” Agarwal said.
In China, where occupancy now approaches 45 percent except in Covid-19-ravaged southeastern China, is refocusing on 400-450 cities instead of its grander strategy before the outbreak.
Agarwal said Friday that the company had to acknowledge that in 2019 it added too many employees, and that to educate them on Oyo’s culture and values takes time.
Of the April furloughs, he said: “There were no good choices. It was one bad choice or another.”
To hear more about Agarwal’s vision for Oyo, listen to the livestream:
Going live with Oyo CEO https://t.co/UPDiqVGXQH
— Skift (@skift) June 5, 2020
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Photo credit: This is a file photo of Oyo hotels founder and CEO Ritesh Agarwal, who discussed the company's prospects with Skift CEO Rafat Ali on his The Long View livestream on June 5,2020. Oyo