Here is an interesting thing about milestones. After achieving one, most dynamic leaders don’t waste time breathing easy. Instead, they would rather inspect these milestones fading in their rearview mirror as they race ahead to achieve the next one.
That is what Zubin Saxena, MD and VP-Operations, South Asia of Radisson Hotel Group (RHG) is working at. The hotel chain recently achieved a landmark of 100 operating hotels in India with the opening of Radisson Bhopal, within two decades of operations. However, Saxena is not interested in resting on these laurels.
While the company already has seven brands across over 60 locations in key business, leisure and gateway centers in the country, he is focusing his attention on opening 15 new hotels in 2022 and over 60 hotels in the next five years. What’s more, he wants to ensure that the owner renewal percentage stays well above 95%.
Here are some excerpts from his interview with Vinita Bhatia:
Having 100 operating hotels in your portfolio is quite a feat. How could RHG maintain its growth momentum in recent months when the industry was undergoing severe challenges?
We have been growing at a very stable pace for the past couple of years and are opening an average of 12 to 15 hotels every year. We continued this trend despite the challenges since the pandemic.
We have opened six hotels this year and plan to open nine more in the coming months. However, it is not just about growth alone. What really gives any brand a competitive advantage is having a high-quality mindset, which then leads to sustainable long-term growth.
During the peak of the pandemic, our corporate teams and hotel staff worked extensively to redefine our operational architecture, which we call our ‘India Unification Plan’. It unlocked a lot of efficiencies in the system and consequently strengthened our operating margins.
Now that the market is slowly recovering, our operational blueprint is helping us deliver industry-leading benchmarks. In fact, we managed to sign eight new hotels in 2020. This really boiled down to our operational excellence and focus on high-quality growth.
Radisson Hotel Group managed to sign eight new hotels in 2020.
While RHG launched its ‘India Unification Plan’ in 2019, which elements were tweaked to help it maintain its growth trajectory in the past 19 months?
Being operationally driven and in constant pursuit of excellence has helped us immensely. Both these aspects depended heavily on how we elevated guest experience across portfolio.
We launched ‘WOW!’, a guest experience programme that aims to ‘wow’ the guests from check-in to check-out. Initiatives like these add meaningful touches to our hospitality and ensure that even the smallest needs of our guests are met to the best of our ability.
For instance, if a guest visits our restaurant and forgets their glasses, we provide sanitised reading glasses so they can order their meal in peace. Similarly, when elderly guests stay with us, our team enquires if they would like turmeric milk at bedtime. So, beyond the physical product, which is the hotel itself, guests truly remember these intangible experiences.
Of the six hotels it opened this year, three are resorts in leisure destinations, including the Radisson Resort & Spa Lonavala.
We also innovated in our food and beverages (F&B) offerings and piloted ‘Meetha’ last year in Delhi. Following its success, this year, we are expanding it pan-India and are launching its first retail outlet in Mumbai. Our recent collaboration with Massive Restaurants also marks a significant step towards strengthening our F&B capabilities.
Lastly, to further strengthen guest loyalty, we launched #Radisson Cares. Through this initiative, we are constantly in touch with our guests and share expert tips across a range of services to make positive difference in their lives. It is this emphasis on consumer touchpoints that has helped us remain on-course and achieve healthy growth numbers.
Before launching any pilot initiative, hotel companies conduct extensive research and then re-examine the strategy. However, they often get locked into a fixed pattern. How did RHG ensure it could take swift decisions with its ‘India Unification Program’ in light of dynamic situation last year?
One should never shy away from ideation, experimentation and innovation. The implementation of the ‘India Unification Plan’ worked very strongly in our favour during the pandemic. We fast tracked from a 12-month delivery timeframe to a 12-week action plan during the first wave of the pandemic.
The key factors for success in our roadmap were our speed, innovative thinking and value-driven mindset. Early on, we realised that through this plan we were able to unlock economies of scale within our management and deliver higher ROI for our managed owners. This gave us the confidence to strengthen this plan and maintain growth sustainable growth across portfolio.
You had mentioned that RHG’s hotel owner renewal rate has been around 99%. Did the pandemic have any impact on this percentage?
Through our deep understanding of the market, partner and guest expectation, we managed to maintain nearly 100% renewal rate. We maintained this trajectory throughout the pandemic as well.
Many hotel companies are accelerating initiatives to capture a share of the revived travel demand. How is RHG taking advantage of this situation in India by tapping the right locations in tier 3, 4 and 5 cities?
A significant amount of infrastructural development is taking place across tier 2, 3 and 4 cities in the country, in terms of considerable construction of roadways and highways.
With this kind of connectivity, domestic travel in India is bound to see an uptick, especially amongst the vast young population that has a high spending propensity. More than 50% of our portfolio is currently in tier 2 and 3 cities. Since we were an early entrant in this category, it gives us added advantage.
Today, there is a Radisson within every four to five hours of drivable distance. Our presence across the length and breadth of this country further helps us leverage this emerging trend.
While we have grown significantly in tier 1 and 2 domestic markets, we are channelising our energies for further growth in tier 3, 4 and 5 markets since this is where India is gradually heading right now, given the boomin domestic tourism. We have some major launches scheduled in cities like Nathdwara, Rewa, Kufri, Sonamarg and Katra.
We will be focusing on these markets through our mid-segment category, which will be driven through Radisson, Park Inn by Radisson and Country Inn & Suites by Radisson brands. These brands will constitute nearly 60% of our development pipeline over the next three years.
Extended and leisure stay brands proved to be resilient last year, with some surpassing 2019 occupancy and revenue levels. What bearing did this trend have on RHG’s short-, medium- and long-term strategies for the country?
The pandemic has done two things for today’s guests. Firstly, it opened up the branded hospitality segment to a wider customer section. Secondly, contemporary guests seek experiences and are willing to pay a premium for that.
Hence, we are noticing a strong recovery curve in the leisure category. RHG, too, is also making a steady progress in this segment. Three of the six hotels we have opened so far are resorts in popular leisure destination – Radisson Blu Resort, Dharamshala, Radisson Blu Resort Visakhapatnam and Radisson Resort & Spa Lonavala. All these properties have seen tremendous amount of success since their respective openings.
We also plan to strengthen our presence in leisure destinations with the addition of resorts in Goa, Pondicherry and Pahalgam this year. In terms of our long-term growth plan, about 10 new hotels will be opened under our flagship Radisson Blu brand, in high visibility locations across tier 1 cities within five years.
What are the company’s plans for the newly introduced Radisson Individuals brand in India?
Radisson Individuals has been a huge success for us. We launched the first Radisson Individuals as Classic Grande Imphal, a member of Radisson Individuals. Two more Radisson Individuals properties are scheduled to open this year, in Katra and Bengaluru, respectively.
Radisson’s ‘WOW!’ programme aims to ‘wow’ guests from check-in to check-out.
What is the criteria for identifying hotels that can join the Radisson Individuals brand portfolio?
Radisson Individuals offers independent hotels and local, regional chains the opportunity to be part of RHG and benefit from the Group’s international awareness and experience. It was launched keeping in mind the huge potential high-quality owners of unbranded hotels hold and to provide them with appropriate distribution impetus coming out of a branded platform like ours.
So, if you see we have named our debut property as ‘Classic Grande Imphal, a member of Radisson Individuals’. The reason we did this is to highlight the uniqueness of the establishment.
We strongly believe that the ‘Radisson Individuals’ brand will help us expand our portfolio by entering newer destinations and exploring newer investor relationships.
