Lemon Tree Hotels Aggressively Looking at Leisure Market Now: Vikramjit Singh

BW Hotelier spoke to Vikramjit Singh, one of the founding members of the Lemon Tree Hotels’ team who joined the group in 2005 and was recently elevated to the position of President and Chief Revenue Officer. The chain currently has 29 hotels in 18 cities, around 3200 rooms. But plans are to increase this number to 60 hotels in 30 cities and around 8000 rooms. We asked him to speak about what lies ahead.

Singh began
by explaining his new role, “I take care of sales and marketing, the entire revenue
base and also business development, which primarily means where Lemon Tree
needs to go as a company, where we are going to open and where we would like
our footprints to be in.”


Singh took
the opportunity of this interview to announce the latest acquisition of Lemon
Tree Hotels in Bandhavgarh. “We have put in our investments and will be
expanding the existing resort to 30 cottages once work is finished,” he added.


It is the
leisure market which Lemon Tree Hotels wants to foray into now, “It is
something we are seriously and aggressively pursuing,” began Singh. The themes
which the company wants to follow are broadly: wildlife, pilgrimage, golf and
hills. “We are building our own resort in Udaipur, we are building Shimla,
while in Katra, a pilgrimage venture, we took the management route. Tarudhan in
Manesar, also a managed property, is our foray into golf tourism,” he told us, explaining
that this was the model a mix of owned and managed, which was the way forward.


Why leisure,
we asked? “We've got the business portfolio growing. Except Mumbai, where we
are building a thousand rooms, we are practically in every big corporate hub of
India. The aim now is to capture the entire share the wallet of our customer, by
venturing into leisure. The average Indian takes three to four holidays a year.
Short trips have become the in thing. It’s a big market space, which is why, we
have a big focus on leisure and the resort portfolio,” Singh told us. 


And though
there are places where the management contract route is being taken, “Lemon
Tree is also aggressively looking at investing in this portfolio. There are
places we are looking at buying land and building, there are places we are
looking at acquiring resort as well,” he told us, besides looking at managing existing
resorts, of course. The aim was to add at least 10 resorts to the leisure
portfolio. 


“From the
point of sales and marketing, we are now expanding two things. The predominant
customer is the Indian domestic customer. In bound is a dying segment, if you
ask me. We have now strengthened our domestic team. I have an offline domestic
team which is majorly covering big domestic hubs, Delhi, Mumbai, Gujarat, West
Bengal,” Singh said when asked about his sales and marketing strategy. 


“Today the
OTAs have completely taken over. Every hotel company is experiencing a big
surge in their online sales. If you ask me, for us online is 30 per cent. The
online reservations go a long way in filling up the resort rooms,” he added.


The target
for the year, he shared, was to take up ARRs dramatically, an increase of
between 25 to 30 per cent, in fact.


“We feel
that the market is now buoyant. It's the right time to go in for a price hike.
We finished last year at 74 per cent occupancy for the group. There isn't much
you can do in terms of occupancy. For us, the only route to take up revenue is
rates and we are aggressively looking at a rate increase now,” he announced.


While the
deeper markets would be able to absorb the rate increase better, some of the
shallow markets and those that are hugely oversupplied, would be the challenge
ahead, Singh said. “If you look at the big cities, Bangalore, Hyderabad, Pune,
Delhi, we will be able to drive a substantial rate increase, which is what we
are aiming at,” he added.


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