While Marriott International made big news in late April by expanding its European pilot program to launch Homes & Villas by Marriott International, first in March came Indian Hotels Co. Ltd.’s announcement to enter the home rental space with a strategy rooted in experiences that leverages its owned assets.
Mumbai-based IHCL, best known for its Taj brand of hotels, launched Amã Trails & Stays, the first branded product in the homestay market in India. Goals for Amã, which translates to “home” in Sanskrit, include scaling the product to 100 properties within the country before the end of 2020, according to Puneet Chhatwal, IHCL managing director and CEO. An average night stay will range from US$100 to US$150.
The company is leveraging existing properties of its sister companies – like Tata Coffee, a sister brand of the Tata Group, the conglomerate that owns IHCL.
“It allows us to test how to get to almost 100 of these (properties) relatively quickly and see if this model is innovative and makes sense, with almost no risk as we’re not putting any money into it,” Chhatwal said. “We’re putting resources, we’re putting time, we’re putting effort, but there is no hard cash flow in there.”
The plan begins with nine heritage bungalows in Coorg and Chikmagalur that had been managed by Tata Coffee. Taj, which will manage going forward, will add two of its own bungalows in Goa by mid-next year under the Amã umbrella. While currently targeting India, Chhatwal said the new brand will, depending on its initial success, consider global expansion.
Looking further ahead, Chhatwal said Tata Group has some 300 to 500 existing potential homestay properties.
From the guest perspective, the bungalows will come with a supervisor who will report to the GM of the area. Each bungalow will come equipped with a cook and cleaner. The focus will be squarely on each individual location and its experiential offerings. For example, one of the Tata Coffee properties will offer guests the chance to tour a coffee plantation and learn how coffee is grown.
The move is also aimed at strengthening Taj’s loyalty program and giving members – especially those in the company’s elite Chambers Club – more experiential offerings and rewards.
The only risk Chhatwal sees is security and safety. Since the bungalows could be in close proximity to a plantation or factory, his concern is that people may want to explore or wander on their own, so ensuring guest safety around these areas is a key priority for the group.
Ultimately, though, Chhatwal said, the biggest opportunity is to take the lead in a space that has been dominated by the Airbnbs of the world.
“All of this was always there in the business, but the hotel industry kept sleeping,” Chhatwal said. “Why not take charge and have the first move advantage rather than allowing someone else to take charge?”