Not so long ago, Indian luxury hotels were almost the exclusive preserve of foreign travellers and business guests – because few other locals could afford to stay at a 4 or 5 Star property. Even those Indians who had money in the bank were budget-conscious and unlikely to spend extravagantly on themselves. Things are very different now, in 2017. Over a generation, there has been a perceptible change in attitude, with more Indians able and willing to spend on brands and experiences. As a consequence, more and more of our countrymen are travelling within India and beyond, perhaps to check out the madness of Oktoberfest in Germany, host a destination wedding in Bali, sign up for an ayurvedic wellness retreat in Kerala, or bring in Diwali with their family at a plush beachfront resort in Goa.

Urban Indians are also no longer as price-sensitive as they were before. A recent survey by travel portal Yatra revealed that luxury vacations are becoming increasingly popular, with 48% of Indians willing to spend more than INR 50,000, per person, on travel this summer, versus just 18% last year, and 32% of these respondents wished to stay in a 4 or 5 star luxury property. This newfound desire to splurge on luxury accommodation is the result of many factors. Affluent Indians today are hungry for experiences that provide a break from the monotony and stress of their daily working lives. Growing incomes mean that families can afford to go away on holidays and live the good life, much like their counterparts abroad. And seductive images of picture-perfect vacations have infiltrated our lives, via the movies, Instagram and Facebook, enticing more of us to experience luxury for ourselves, firsthand.

India – A New Home for Global Luxury Hospitality Players

All these factors have led to an explosive growth of the Indian luxury-travel market. A report by Amadeus [1.22MB PDF], a Madrid-based company, pegs our growth to be higher than all 25 countries they studied and expects the segment to grow at 12.8% between 2015 and 2025. Naturally, a great many companies wish to cater to customers in this space. Chhavi Chadha, the founder of Bespoke, a boutique luxury travel company in New Delhi catering to ultra-HNI individuals observes that, “There are hotels that are coming in, there are destination management companies and there are countries coming in” all eager to get a share of this action.
For instance, German luxury hotel company, Steigenberger Hotels, has partnered with MBD Group, a Delhi-based firm that owns the 5 Star Radisson chain of hotels, to build five luxury hotels and manage another 15 luxury properties in India by 2030. Work has already begun on their 300+crore property in Whitefield, Bangalore. Typically, a room at a Steigenberger, say at the Hotel Herrenhof in Vienna, is priced at 300+ Euro or roughly INR 20,000 or more a night, which will certainly put these rooms in the very upscale bracket in India, if their pricing strategy remains the same.

The Hip Hotel Wave Comes Ashore

Another international player who has just set foot in India includes the W brand. The first Indian W threw open its doors to guests just this March, in Goa. Competing with conventionally opulent luxury hotels like the Taj, Park Hyatt or Alila resorts, the trippy, trendy W in Goa offers 160 themed rooms. They also have a 14000 sq ft spa – India’s first outpost for Clarins. And because weddings are big business in India, W is building a grand ballroom and developing an additional 50,000 sq ft of event space for those who want to plan a hip Goa beach wedding. Room rates at this spanking new hotel are upwards of INR 13,000 and go up to INR 83,500 per night, during the off-season.

The global Hyatt Hotel brand which took on the Four Seasons and the Ritz-Carlton with its super upscale Park Hyatt brand has now opened the informal, stylish and imaginatively conceived concept hotel with Andaz, in Aerocity, Delhi. India’s first Andaz will offer 446 guest rooms, and 100 residential, serviced apartments to travellers from the world over. The hotel will also house a deli, a day-care centre, private outdoor pools, two restaurants, fitness centre, spa, ballroom and other facilities. One of India’s top food critics Vir Sanghvi admits to being blown away by the Andaz’s restaurant and calls the property a generation ahead of any Indian hotel he has ever seen. That is high praise indeed coming from one of India’s best-known lifestyle journalists!

Big Box Hotels Vs Boutique Hotels

Lifestyle-category luxury hotels like Andaz and W are rubbing shoulders against recognisable big box hotels like the Ritz-Carlton or Marriott and homegrown brands such as ITC, Taj, Oberoi and Leela properties. Luxury hotels are also competing with super-premium boutique hotels in other parts of the country, like The Khyber, a Himalayan resort & spa, in Kashmir, which offers L’Occitane Provençal style treatments using Himalayan spring water and shea butter from Burkina Faso. Well-heeled domestic and international travellers are drawn to these standalone, intimate places because they offer a change from the standard name brand-hotel experience. Nikhil Ganju, head, Tripadvisor India, says that boutique hotels often garner multiple awards and are the basis for a shift in consumer preference. He adds, “Luxury is no longer only about having a well-appointed, luxurious room. It’s also about the ability to create unique and special experiences.” Located in truly exotic locations, boutique hotels help their guests focus on wellness, sample local culture and cuisine, and create unforgettable memories. For instance, guests can indulge in a tea-tasting session overlooking the mighty Kanchenjunga range at a Darjeeling tea-estate-turned-hotel, dine under the stars, pick apples or go trout-fishing in Manali while renting a cabin tucked away in the mountains.

Bespoke Experiences

Those visiting big brand hotels in cities also have access to personalised experiences. Guests can take sushi-rolling lessons courtesy master chefs at Wasabi by Morimoto at the Taj Mahal hotel in New Delhi or explore the bylanes of Old Delhi in a rickshaw. Grand Hyatt residents in Mumbai can skip the local train in favour of a more luxurious ride in a BMW 7 series. And couples can renew their wedding vows, for a cool INR 1 Lakh, and pretend like they are Indian royalty, at the Oberoi Rajvilas in Jaipur. The list of products, services, and experiences that the hedonistic consumer of today demands is endless. And luxury hospitality businesses are looking for partners, suppliers, and external service providers who can help them cater to these emerging needs.
Whether you are a company that makes single origin chocolates, organic spa products, artisanal cheese or wish to offer snowboarding equipment to a ski resort located in the Himalayas, there are a host of opportunities that you can tap into, as an independent vendor or small business. In our capacity as consultants for the hospitality business, Arsha has the know-how you need to approach big brand names or standalone properties in India today. Please contact our consultants for more information on how Arsha can assist you.

Preeti Prakash | Journalist

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