Next on the radar: OYO set to grow in Indonesia

Its raining Asian expansion stories this week. With RedDoorz expanding its footprint in Indonesia, OYO is not too far behind. Their latest press release confirmed it is seeing exponential growth in Indonesia within three months of its operations in the country.

Launched in October 2018 with a string of over 30 full-inventory – franchised and operated – exclusive hotels and over 1000 rooms in three cities in Indonesia – Jakarta, Surabaya and Palembang, today OYO Hotels is already operating 150 hotels across 16 cities, and has seen a 5x jump in growth.

OYO Hotels “is charting a strong growth trajectory for itself in the country by adding 70 hotels every month to its chain and is looking at ending 2019 with its presence in 100 cities across Indonesia”. OYO thinks they are able to achieve this due to strong local talent and execution, and a firm commitment towards adding value to Indonesia’s hospitality industry.

“We entered Indonesia with the mindset of an Indonesian company”

Commenting on the strategy for Indonesia, Ritesh Agarwal, founder and group CEO, OYO Hotels and Homes said: “We believe that our secret to success in Indonesia is the way we have built our business in the country. It was never about expanding into this new country with a distinct multi-national identity or way of working. We entered Indonesia with the mindset of an Indonesian company that saw an opportunity to emulate OYO’s successful business model in India to create something unique and relevant for Indonesia, and the results are visible. Each and every aspect of our operations in Indonesia is highly localised. This localisation had helped us in customising our offering from the point of view of a traveller in the country and what was lacking from his/her experience earlier when OYO was not around.

“Through this approach, we have been able to create a unique and authentic local company led by best local talent in the country and backed with the knowledge and know-how of the parent brand, that promises good quality affordable accommodations in more and more cities in Indonesia. It is still Day 0 for us, we are definitely betting big on Indonesia. We intend to invest over USD100 million in this high growth market and plan to expand our presence to the top 100 cities in Indonesia, including Yogyakarta, Bandung, Surabaya that we recently entered and breaking into Bali over the next 11 months.”

A local favourite

“Aim to expand OYO’s Hotels to more than 100 cities in Indonesia”

Rishabh Gupta, country head, Indonesia, OYO Hotels and Homes explained: “We’ve received an overwhelming response to our offerings as over 70% of our hotels currently enjoy an 8+ rating across various booking platforms. Our execution and operational excellence are backed by the efforts of a local and strong team constituting of over 400 Indonesians with thorough understanding of the country’s hospitality landscape and customer value proposition.”

“With the total investment of USD 100 million committed to this market, we have aggressive growth plans for 2019. We aim to expand OYO’s Hotels to more than 100 cities in Indonesia.’’

In the words of Ibu Lidya, owner of OYO Sarkawi Residence in Indonesia, said: “I manachised my asset with OYO Hotels four months back when I was struggling with 28% occupancy. OYO Hotels renovated my property beautifully, and now we are at 92% occupancy, regularly. The general manager appointed by OYO has been a great support, and we are considering buying a new asset for OYO Hotels.”

With a dedicated team of 70 civil engineers, OYO is capable of transforming hotels in merely 20 days up to the OYO standards ensuring a quality-driven experience for our guests.

Sigit Roestanto, acting president director of HK Realtindo, commented, seeing the trend of digital technology today is an important element that can be counted to increase product marketing, even for property products. “In this way, HKR seeks to maximize the role of digital technology that is easily accessible and widely used by the public to expand the target market for property businesses, we are optimistic that working with OYO Hotels can help increase profits and corporate occupancy.”

Recent successes of the brand in other Asian countries like Malaysia and China are resulting in existing users using the OYO app in Indonesia. OYO has a similar success story in China where it is now present in over 280 cities with 5000 hotels and over 260,000 rooms.