M!CE will surge

“Both states and hotels should look towards doing joint promotions with the travel agents to boost domestic tourism in India. M!CE is a big segment and according to 2018-19 data, this segment earned a revenue of Rs25,000 crore. With new ventures like banquet halls, trade fairs and facilities in cities like Delhi coming up, it is expected that by 2022, this revenue could double to the tune of Rs40,000-50,000 crore. All the states should consider opening new M!CE facilities.” up with a booklet that mentioned every process and rule that was needed for private investors. Such initiatives should be taken forward,” he recommends.

Price point and perception

While it may not be difficult getting a hotel room of even a fourstar deluxe property in USA or Europe for a rate as nominal as $40-50, this isn’t the norm in India. One needs to understand if domestic tourism still stands a chance in this reality. Hannaford says that revenue management has a huge part to play in pricing. “Sometimes, this can also be about driving occupancy, wherein you will find that for a limited time, a hotel may have a price to possibly entice new customers to come, or they must be newly opened, or they might have gone through renovation. There are several governing factors as to where a price point sits, and it’s been around for centuries. This again goes back to one’s perception of value,” she explains.

Furthermore, Hannaford says, it depends on the hotel, the situation and what market the hotel is in. She shares, “I believe that the travel agent community is of absolute experts and they should be paid for their expertise. If you want to have low rates, you are starting to eat into the commissions of travel agents/consultants/ambassadors. We are in this industry together. The travel

– PP Khanna

difference in commission levels between a 7,000 booking versus a 12,000 booking. Hence, we should always consider the supply chain.”

For Lohani, it is a question of demand and supply. “The number of hotel rooms in India in the classified category, I think, is around 125,000, which is not enough. That’s a major issue— star-rated rooms are much less than what is required. We need to build more hotels, roads, signage, etc., and with all of this we should build tourism,” he says.

In India, the supply of hotel rooms falls short of the demand for them. Khanna says, “The states should come forward and ask private entrepreneurs to invest in tourism infrastructure under the PPP model. Private investors can build hotels and the states can give subsidies. Once

Hannaford feels that rates are going to be very interesting because there is going to be a survival period and then a revival period. “In the survival period, we will be talking to our partners and working through what needs to happen, how we need to make it happen and what value additions are going to be there, which is very critical. I have worked all over the world and my observation is that the Indian hospitality and tourism industry has shown such solidarity that I’ve never seen anywhere else. If any country can pull itself up quickly, it’s India. It is so resilient and optimistic that turning the corner is near. It’s very impressive,” she says.

Learnings from China

Hannaford says, “Our team has observed that people were celebrating and corporates have started coming back very slowly. They revealed that people in China are wanting to spoil themselves — by having a birthday cake, by getting back together with friends, relatives, colleagues and people they haven’t seen in quite some time. Thus, they want to spend a little bit more than they normally would. Not every

major city is back yet. However, we are seeing something positive — people are staying locally at a hotel. Hence, it’s important to be talking to the travel consultant, about doing something special and unique. The team in our sales offices are on the phone talking and advising them in terms of what they can offer.”

Another observation she shares is that midscale hotels started off first, followed by five-star hotels. “However, it would still be a long

he feels that as soon as tourism bounces back, all these people will also come back. He adds, “A lot of competition will and tour operators.” He says that all stakeholders must focus on attracting leisure tourists. “This digital conclave is part of