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Premier Inn, the UK’s largest hotel chain, is popular among international travelers as a budget hotel. But in India, where it will open its first hotel in Bangalore early next month, Premier Inn is pitching itself as a value-for money mid-market brand.

“In India we realized that the consumers’ connotation of a budget hotel means something that might not offer quality. So we decided to term ourselves as value for money mid-market hotel brand,” says Aly Shariff, managing director of Premier Inn, which plans to build 80 hotels across the country for an investment of 300 million pounds.

It’s not an exception, though. As a rule, most international hotel chains are positioning themselves higher than their global equity in India, thanks to the c http://www.propertycafeteria.com/prime-property.aspxountry’s peculiar business model for building and running hotels that just can’t survive here without restaurants and banqueting facilities. For example, Park Inn, an international three-star hotel chain belonging to the US-based Carlson Hotels Worldwide, is branded as four-star hotel in India.

“Mid-market hotels in the western countries do not have elaborate food and beverages options or room service since people tend to be select service hotels. But in India, food and beverages contributes significantly to the overall hotel revenues and so most international mid-market brands tend position themselves as 4 star,” says Ajay Bakaya, executive director of Sarovar Hotels & Resorts that runs Park Inn and Park Plaza hotels in India under a franchisee agreement with Carlson.

In India, where the concept of ‘select service hotels’ does not exist, food and beverages account for about one third of a hotel’s overall revenues, according to industry estimates. Total ancillary services in a 5 star hotel, which also include renting of banquet halls, spas and night clubs, could constitute as much as 45% of a hotel’s business here.

In India, hotels are food and beverages destinations and host weddings unlike the western countries,” says Rajiv Menon, area vice president (India, Pakistan, Malaysia and Maldives) of Marriott International, a US based Hotel Company.

This has forced moderately priced brands like Courtyard by Marriott to offer elaborate in-house dining services, concept restaurants or banqueting services in India, while globally they have elaborate dining options outside the hotels, he says.

Another aspect that’s making hotels to upgrade their positioning is the high real estate costs, says Siddharth Thaker, executive director of hotel consultant HVS India. According to him, real estate costs in India at 35-40% of total project costs is double that of global average. “This leads most international hotel brands to position themselves higher than what they are branded globally so that they can become profitable faster.” This trend, however, can confuse international travelers visiting India and Indians traveling abroad. It can even lead to cannibalization of brands, warns Larry Malarkar, an independent hotel consultant.

Theformerinvestmentportfolio.aspx/">Starwood Hotels regional director expects stricter branding standards in the future as most international hotel chains are now introducing multiple brands in the country. “If international hotel brands do not work towards uniform branding, it could lead to cannibalization of brands,” says Mr Malarkar.

Some hoteliers have started doing that, by realigning hotel brands to position them as per global markets.

For instance, ITC Maurya Sheraton in Delhi was recently rebranded as ITC Maurya-The Luxury Collection as the hotel offered far more facilities than what brand Sheraton offers globally. This made Starwood Hotels and ITC Hotels to rebrand the hotel, an ITC spokeswoman said.

Single-brand chains like Premier Inn may not be too bothered about such confusion, but the Carlsons and Marriott’s may go the Starwood way as India steadily climbs to the top of the world.

Courtesy:- ET dt:- 23-10-2009
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The foreign investment promotion board (FIPB), the apex body that clears foreign capital inflow into the country, has allowed New Delhi-based Capricorn Hospitality Services to seek Rs 576 cr foreign investments worth 49% of its equity. The funds will be used for making downstream investments.

The FIPB has also allowed Hyderabad based Indus Renewable Energy to bring in Rs 500 cr to invest in hydroelectric power projects and Dawnay Day AV India Advisors to infuse a foreign capital of Rs 30 cr to start commodity broking in the country, the finance ministry said in a statement here.

The board approved investments worth Rs 1,360.5 cr on October 9, the ministry said. The board also allowed Monsanto India to undertake business activities involving genetically engineered cells and material.

The board, however, deferred decisions on Jet Airways’ proposal to raise capital from foreign institutional investors and Analjit Singh’s and Asim Ghosh’s proposals to divest part of their stake in Vodafone Essar.

Courtesy:- ET dt:- 23-10-2009

Realtors are beginning to warm up to SMSs and web applications to advertise their products, which are quite cost effective, says Namrata Kohli

JJ... launches K... with Golf Course 2/3/3+1 BHK@ 21.5 LACS onwards, Sector 134, Noida Call 9911943127... Do you receive at least two-three such SMSs per day? Do you delete them/retain them/think about exploring further, or simply let them be. In any case, love it or hate it, but you surely cannot ignore them - this in-your-face advertising is surely having its desired impact and will rule the roost in times to come. Or so say, branding pundits on this latest advertising tool being deployed by many real estate developers.

Drawing a comparison between different media for advertising the real estate offerings, Jayanta Barua, a PR person, says, “SMS and the WEB will clearly hold the future as messaging with database is both forceful as well as extremely cost friendly.

” Even though, currently, it is the print media, which most developers swear by, to create both brand awareness and conversions (of readers to buyers of their product), SMS marketing offers a far better spread than conventional media.

Plus, the results in conventional media come at a huge price, something that is marginalized substantially in SMS marketing. Barua draws a comparison between the cost dynamics in these media saying that in print media, an ad in a leading English news daily on the front page costs at least Rs 13 lakh (having a circulation of 13 lakh) whereas an SMS only costs 8 paisa for a 160-character ad and if it were to be sent to 13 lakh people with 320 characters, it works out to only Rs 2.08 lakhs.

“In print, when we spent Rs 13 lakh, it only generated around 300 queries leading to a per query cost of Rs 5,000. Whereas, recently, we did a radio campaign for Rs 16 lakhs, which generated 700 queries, taking per query cost to approx Rs 2,300. However, in an SMS campaign which costed us approximately Rs 1 lakh, 100 queries were generated and the cost per query was a reasonable at Rs 1,000.” He adds that by advertising in newspaper they get clear results in two days while radio gets them queries on the same day.

According to Sunil Jindal, CEO of SVP Builders India ltd, “Print will be there for the next 10 years, but the future will ride on mobile value added applications as well as on web applications. According to me, SMS/WEB will be the future mediums of advertisements.” He says that he attributes the reason to technology, which will drive SMS way ahead of other media for advertising purposes. ‘’For example, if a customer gets an SMS of a project launch from SVP, as soon as he reverts to the SMS, instead of my executive calling you in 24 hours, the panel will directly connect customer to my executive who will take care of the hot call.”

All real estate developers have channel partners who undertake the job of sending SMSs and these associates (brokers) are seen using this medium more than conventional classifieds in newspapers. However, crispness of the communication is vital to the success of an SMS campaign. The better and more factual the advertisement is, the better will be the response.

What then is the frequency of sending SMSs? According to Jaypee Greens’ Manu Goswamy, head of business development, “We have various channel partners who do send SMS as part of the promotional activities.

The frequency of SMS broadcasting normally increases at the time of new product launch. But we do not have the exact numbers, as normally we do not interfere in channel partner businesses.”

As a thumb rule, it is sent on important days like Navaratra, Diwali, long weekends such as Independence Day weekend etc. Various advertising and promotional activities are undertaken at the time of launch such as offline advertisements, online advertisements and outdoor advertisements. SMS campaigns are something that complements these other mainline promotional activities or a support function.

What do the realtors primarily achieve — brand awareness or are there real conversions too? Says Goswamy, “It depends on the type of communication sent in the SMS as to what objective we are trying to achieve. Normally, at the time of any new launch the objective is to create brand awareness by sending some teaser SMSs to generate curiosity, which is followed by a detailed SMS on the product along with a call to action, ultimately resulting in generation of leads and sales conversions.”

Branding experts feel that a clear advantage of advertising through mobile value added applications is that the service reaches the target market within seconds and it helps in building new relationships and keeps active the regular contact with existing customers. On the flipside, the characters of the text message are very limited, hence it is essential to create a text message that is clear and concise, which is difficult at times, to promote a real estate project, says a developer.

There is the other view that this form of advertising is plain irritating for end users. Amongst the developers who prefer traditional ways of marketing and who do not indulge in SMS marketing are Vipul. Says Guninder Singh, chief executive, Vipul Ltd, “There is no definite or reliable report available on the effectiveness of SMSs marketing and with ‘Do-not-disturb’ services available, we believe the effectiveness of SMS service will remain very limited. Still, a real estate buyer would like to get in touch with the property developers directly or through an agent.”

He adds that based on the marketing research they did internally, they found that print media would be the most effective medium at present.

“Though it is expensive, yet it provides a maximum recall value to the product, its sustainability is longer and we get connected to a couple of lakh people through a single ad. It is most likely that a customer will visit a sample flat after seeing it in a newspaper. Also emails, which are quite cost effective, are on our radar.”

Courtesy: - TOI dt:- 17-10-09

You can invest in property for both immediate rental returns and long-term wealth creation, says Vikas Agarwal

As economic conditions improve globally, the cheer is coming back into the property market. Analysts believe it is a good time for those looking at investing in property, both residential for own use as well as from an investment perspective. Investments in property bring diversification to an investor’s investment portfolio. Historically, it has been proved that a property investment is a lowrisk option with high returns over a long term.

Usually, price volatility is quite low in the property market. Due to the global recession, property prices corrected in the recent past. As the global economic conditions are improving, the demand in the property market has increased. The property prices have begun to show signs of appreciation. Therefore, it is a good time to go in for property.

Investments in property offer short-term returns in terms of rental income and long-term returns in terms of capital gains. Therefore, it is suitable from a short-term as well as long-term perspective. Property adds to the long-term wealth creation goal of an individual. The government also provides income tax exemptions for those invested in residential property.

In general, investments in property require a significant upfront investment. Therefore, it is important to plan well while entering into a property investment. Location and price of the property are the two most important factors that pretty much decide the returns from the propertyinvestment. A property investment in an upcoming area gives the best returns over time.

Here are some options available for investors:

Residential property

Investors who do not have a house of their own should first look at buying a residential property. There are many sops available for investors buying a residential property, especially the first residential property. The government gives an income tax exemption on interest paid against a housing loan, to a maximum of Rs 1.5 lakhs per year. Also, investors can claim a rebate in income tax on the principal repaid, to a maximum of Rs 1 lakh.

The government is planning to increase the limits of these exemptions in the new tax code. In addition to these, attractive housing loan schemes are available in the market and the interest rates on housing loans are lower than the interest rates on other borrowings.

Site

A site is good for those who can keep a regular watch on it. An investment in a site requires relatively more attention at the time of purchase. The percentage returns on sites at good locations is mostly higher than other options. The value of a site in developing areas has appreciated many times over the last few years.

Commercial property

A commercial property is a good investment for those looking at high rental income and capital appreciation over a long run. The price of commercial property is quite high. However, commercial property in a prime location has the potential to earn 10 to 12 percent returns in terms rental income.

Perspective

There are two avenues in property investments - buying a house to live in and an investment for capital appreciation. Buying a house to live in should be done as early as possible as it saves tax, and creates long-term wealth.

An investment for rental returns and capital appreciation should be planned well. It helps in portfolio diversification.

Courtesy:- TOI dt:- 17-10-09