Skift Take

The Oberoi Group understands its position among competitors and strives to differentiate itself through quality. The future of India's hotels and economy relies largely on a shared mission to empower the country's workforce and travelers.

Vikram Oberoi, CEO and managing director of the Oberoi Group, knows luxury inside and out. Oberoi-branded hotels — recently ranked as “world’s best” by Travel and Leisure readers — are quite familiar to Oberoi himself: He spent the first decade of his life in the Oberoi Grand, Kolkata, before a stint in the Oberoi, New Delhi.

Oberoi attributes the company’s success to responding to guest feedback, emphasizing quality over quantity, and considering employee needs. Oberoi sat down with Sean O’Neill, Senior Hospitality Editor at Skift, at the Skift India Summit 2024 to discuss the company’s future, competitive advantages, policies affecting hotels, accessibility, and what’s in store for India’s economy.

Here are some of Oberoi’s thoughts on India’s future in hotels, shortened for clarity. Watch the full interview below.

The Oberoi Group plans to open 50 hotels by 2030.

Oberoi: Our vision for 2030 is to expand both the Oberoi brand and the Trident brand. We’d like to open 50 new hotels by 2030, so that’s what we’re focused on delivering. Some of the hotels will be smaller. One of the things that we’re working on… are smaller hotels in beautiful locations (that) have a strong sense of place. All our research on guests tells us that that is something they would deeply value.

India’s hotel companies should consider raising their rates.

Oberoi: I sometimes feel our rates in India should be much higher, and I’d urge all our colleagues to drive rates up because you have amazing hotels, whether it’s Taj, it’s Leela, it’s Oberoi. Our hotels are world class in India. If you compare us to hotels in other parts of the world, our rates are very often fantastic value for money. In fact, beyond that. So there’s an opportunity to catch up with the rest of the world on rates.

The Oberoi Group’s data reflects the growing affluence of Indian travelers.

Oberoi: When we look at the actual rates achieved for our domestic guests, vis-à-vis guests coming from other parts of the world, the rates in a particular hotel vary from location to location. But our average room rates for our Indian guests are higher than (what) it is for overseas guests, in leisure and also in our city hotels.

India’s hospitality and tourism industries need to work collectively on promoting employment.

Oberoi: As an industry, we need to do more to really highlight how important hospitality or the tourism sector is in employment. We have a young population. People need jobs. If we’re going to drive economic prosperity, job creation is very important. I think hotels and the tourism sector do very well in that regard. I think we need to talk about that more and educate the larger community on the enormous employment generation that comes from our business.

To keep up with the demand for hotels in India, the state and central governments should consider granting industry and infrastructure status, promoting cost savings for businesses.

Oberoi: Some states have actually given hotels industry status, and there are many benefits with that: lower property taxes, better tariffs for electricity. There are cost savings on that. I’d encourage more states to do that.

At a central level, EIH (the Oberoi Group’s parent company) may not directly benefit as much from that. I think if we want to drive growth in hotels and increase supply as India’s demand grows, then giving infrastructure status to the industry would be important. You can borrow at lower rates, you have a longer duration to pay off your borrowings, and I think that will stimulate additional supply, as well.

A focus on quality and investing in employee growth sets the Oberoi Group apart.

Oberoi: I think our focus really is not to be the biggest. That’s not the playing field in which we play. Our focus is really to be the very best. If I look at our key stakeholders, to offer the best service to our guests — both meaningful and personalized attention, given from the heart of our people — our belief — and probably supported by data, as well — is that guests, number one, appreciate that and are willing to pay a premium for that.

So I think that’s very important for us and for our colleagues also. We invest huge amounts of money, for the size of organization that we are, on learning and development. We have the Oberoi Centre of Learning and Development.

In order for us to attract the best talent, the best way to do that is to give people a strong foundation that allows them to grow within Oberoi or outside of Oberoi. So we are very proud of the investments we make in human talent. That allows us to track the best talent, as well. So I think that gives us a very strong foundation to really provide exceptional levels of service and really to be the very best we can.

The increasing strength of India’s middle class could foreshadow long-term economic prosperity in India, and more travel.

Oberoi: India was a poor country. Poverty was widespread in India. There was a very small middle class, if you go back to the post-independence of India. That’s significantly changed. I think, for any economy to have long-term prosperity, you need a strong middle class. Those numbers are growing phenomenally in India.

And with that comes better education for children, greater propensity to spend, travel, experience the rest of the world. So I think all those are real positives. One of the things that we do see — or at least this is my perception — is, as people are traveling more and experiencing more, we as Indians are becoming more confident. And I think that’s a good thing.

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Tags: hospitality, luxury hotels, oberoi group, skift india summit, vikram oberoi

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