Back in 2013, Ritesh Agarwal-founded OYO Hotels & Homes disrupted the branded segment by launching A/C rooms with free Wi-Fi and breakfast at ₹999. OYO has done it again, with another price disruption in a bid to fill up rooms post-Covid.

The hospitality venture has launched rooms from ₹299 to ₹699 all inclusive, across the country.

With Covid-19 bringing the hospitality industry to a halt, Agarwal and his team had to think smart to optimise value for its merchant partners and customers. Leveraging technology, OYO Discover was rolled out as a pilot in Delhi/NCR in October 2020 with 24 merchant partners willing to offer rooms to customers to experience their first OYO stay at minimal price points. Subsequently, this plan was rolled out pan-India with over 1,700 merchant partners.

Wooing first-time users

“OYO’s price algorithms and repeat rate data show that first-time OYO users who try us at a non-prohibitive price tend to repeat us more often. OYO Discover was the result of this collaboration and insights,” explains Agarwal.

Since its roll out, more than 3 lakh customers have tried their first OYO with OYO Discover and they have booked over one lakh nights after their first stay, according to the chain.

Deep discounting, of course, has its risks, especially to a brand’s equity. Siddharth Thaker, Managing Partner, Prognosis Global Consulting, says, “These price points are meant to drive demand in the short term, and are not sustainable in the long term. It is targeted at customers from the unorganised sector who typically stay at guest houses and dharamshalas , with a superior, sanitised product at similar price points.”

OYO Discover was also introduced in the international market starting November 2020 and is now available across Indonesia, Malaysia, Saudi Arabia and the UK.

comment COMMENT NOW