OYO ROOMS: INTERNATIONAL EXPANSION
MARKET ANALYSIS
Hotel brands – a very competitive environment:
Internationally, competing on price alone can be a downward spiral, especially when the perception of quality is diminished when a non-staple product is commoditized. In premium markets elements like service, exclusivity, and security come into play. Facilities like pool complexes, spas, gyms, golf and other recreational activities can become expected amenities. Hotel management companies focus managers and budgets to cash flow, profitability targets, and occupation cost demands.
However, the industry is changing rapidly, with substitute business models coming up. A Marketline Industry profile of April 2014, described “A new substitute in the form of private rentals, widely available through on line services such as Airbnb and Flipkey is a potential threat to the hospitality industry.” Chains such as Airbnb are described as being an emerging threat to the hotel industry. Airbnb has accomplished more growth than the top 10 global hotel companies have been able to grow in 20 to 240 years. The growth accomplished by Airbnb and OVRP’s regarding numbers of listings and revenue is unprecedented. Airbnb has become one of the world’s most valuable startups within only 6 years. OYO, through its international expansion plans, aims to replicate Airbnb’s success in foreign markets.

Porter’s five forces analysis:
The hotel industry is a group of like companies providing products and services that satisfy a similar need, function and use, and is highly influenced by travel and tourism trends and is vulnerable to global economic conditions. The following five forces analysis considers the general international market, to understand Oyo’s opportunity for global expansion:
Threat of substitute products:
Threat of shared economy substitutes, like Airbnb is high, with a