Travel start-ups woo corporate clients

Start ups in the hotel space are stepping up efforts to woo corporate travelers, a fast-growing segment that generates repeat business. Hotel room aggregator Oyo and online budget hotel booking start up Treebo are two such companies that are betting big on corporate clients.

“We have pressed the pedal on corporate channel in the past six months or so. If you give a good service, you get a lot of repeat business. The corporate segment business can grow rapidly through word of mouth as well. Many guests from corporate clients eventually end up using our hotels for personal travel too,” said Sidharth Gupta, co-founder of Treebo, which is present in 25 cities through 125 franchisee hotels having over 3,200 rooms.

 

For Treebo, 30% of the total bookings come from corporate clients, now about a thousand in number. These clients are mostly from IT, FMCG and consultancies, while many start ups are also joining the list. Such corporate clients are offered a credit facility for 30-45 days with other frills like complimentary upgrades and flexible check-in/check-out. Last week, Treebo, which counts SAIF Partners among its investors, raised Rs 112 crore in funds. It plans to expand its presence to 450 hotels with 12,000 rooms in the next one year.

Treebo identifies companies with travel accommodation needs and makes a pitch. After negotiations, a rate contract is entered into, based on the demand projected by a client.

Last month, Oyo Rooms announced a self-serve platform for business travelers on its mobile app. The rooms are present in about 6,000 hotels across 180 cities in India. The company launched this after a pilot with clients like Citibank, Sony, Evalueserve, Ranbaxy, Capgemini and Larsen & Toubro and companies in the small and medium enterprises segment. It claimed the companies saw average savings of 30%. Since launch, a little more than 4,500 companies have come on board, it said.

Should the established hotel chains worry? Yes and No. While platform like Oyo and Treebo will not cater to top executives in most companies due to their budget offerings, they will indeed make a dent into some business of hotel chains that also have mid-range hotels. Corporate clients bring over 50% of bookings to leading chains, especially in cities that are not leisure destinations.   

Raj Rana, chief executive officer (South Asia) at international hotel company Carlson Rezidor, which operates over 76 hotels in India under premium brands like Radisson and mid-segment brands like Park Inn, said: “The way customers book and choose their travel needs is no doubt evolving. No one can ignore this. However, brands like ours offer a greater assurance of service and quality”. He also said that a global brand with a global presence allows corporate clients to negotiate rates for all hotels for their domestic and overseas travel needs.