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Business News/ Companies / News/  Robert Gaymer-Jones | India has seen steady growth for demand in luxury consciousness
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Robert Gaymer-Jones | India has seen steady growth for demand in luxury consciousness

The global chief executive of Sofitel Luxury Hotels talks about plans to expand in India

Robert Gaymer-Jones, global chief executive, Sofitel Luxury Hotels. (Robert Gaymer-Jones, global chief executive, Sofitel Luxury Hotels. )Premium
Robert Gaymer-Jones, global chief executive, Sofitel Luxury Hotels.

(Robert Gaymer-Jones, global chief executive, Sofitel Luxury Hotels. )

Mumbai: Robert Gaymer-Jones, global chief executive of Sofitel Luxury Hotels, a part of France-based Accor group, believes Indians are ready to check into luxury hotels. In an interview on Wednesday, he said there was a shortage of branded hotels in India and this offered opportunities to brands like Sofitel to enter the country and commit to long-term investments. Gaymer-Jones, who was in India for Hotel Investment Conference South Asia 2013, spoke of the company’s plans to expand in India and a global repositioning of its properties. Edited excerpts:

India has almost all international luxury brand hotels. Why would one want to opt for Sofitel?

Sofitel is truly a global luxury French brand. We built our first hotel in Mumbai—Sofitel in the Bandra Kurla Complex area of Mumbai—as a true reflection of our style as a brand linking the very best of India and the very best of Paris...

Did you time your entry well in India?

In a number of ways, our timing is perfect; the opening of our flagship property in Bandra Kurla Complex coincided with BKC becoming a flourishing finance and commercial hub. Two more are under construction.

What’s been your experience in India in terms of dealing with regulatory bodies and demand?

Sofitel has had a very positive experience with the regulatory mechanism in India. Of course, each country has unique challenges and from time to time we have faced those in India as well, but that has been our experience in several other nations as well... India has seen a steady growth for demand in luxury consciousness.

But the market is said to largely favour budget and mid-scale hotels.

Sofitel is focused on the luxury and upmarket customer. India is a versatile market and the Indian hospitality industry is projected to grow at a rate of 8.8% during the decade of 2007-16, placing India as the second fastest growing tourism market in the world. Many brands in the luxury segment have entered India in the past 3-4 years. Thus, we see a strong role for our premium brand in this country.

Hotel companies, however, are not making super profits in India and travel is the first item that will go off from the list when a slowdown hits the economy.

In every economic slowdown, there is also opportunity. In the early days of the global financial crisis, India emerged as one of the strongest economies in the world and Indian investments in foreign countries and businesses helped keep them afloat. In 2013, the Indian economy might be showing signs of slowing down its pace of growth while other economies are starting their recoveries from the financial crisis mentioned earlier.

All businesses are cyclical and we do not look at countries in snapshots but with a long-term view. The nature of the hotel business demands long-term gestation for construction of hotels in India and so, while we may start building a luxury hotel today, it will only open after 3-5 years and the business cycle will have moved dramatically from when we started construction.

We believe India is truly an opportunity that we cannot ignore as a long-term investment destination. There is vibrancy and energy in India that is not so apparent in other markets that we operate in. This leads to opportunities in business and also for knowledge. A robust domestic demand coupled with a young population with very low penetration of long-distance travel options makes India a developing market that is unparalleled in the world today.

What trends do you see among Indian customers?

Our findings indicate that the domestic Indian traveller travels for both work and pleasure. But at the luxury end of the market, where Sofitel is positioned, it is mainly for business and some high-end leisure travel for weddings and family events. Like any developing market in the world, India and Indians are discovering luxury in terms of travel and hotels. The number of business class travellers is growing rapidly, regardless of the number of flights between main gateway cities in India. The domestic traveller is most likely to book directly at the hotel, normally 72-24 hours before arrival. We are, however, seeing a shift in this segment to more and more online purchases, even though the booking period is not becoming any longer.

Experts always compare the number of rooms in New York with the total hotel room capacity in India. Is this a fair comparison?

This is an often quoted and sensationalised statistic and like all statistics, it can be viewed in many ways. According to independent sources, New York is often quoted as having more branded hotel rooms than the whole of India. While this may be an absolute fact, it does not tell the whole story. New York has been an international business centre for almost 100 years and a leisure destination for almost that long. The US is also the largest travel market in the world and a large proportion of that travel is domestic. I believe the shortage of branded hotels rooms in India is one of the opportunities that await brands like ours, who are excited and committed to a long-term investment in the country.

What about your expansion plans?

We aim to have hotels in Delhi, Bangalore, Chennai and Goa in the coming years. Sofitel Luxury Hotels also plans to have over 150 properties across the world by 2015. This is the result of a significant repositioning exercise that we have undergone—from 206 properties in 2006 to over 120 properties in 2012. Many of these will be in the Asia-Pacific region as well.

Any Indian hotel companies that you admire?

Many Indian hotel companies are admirable and we have much to learn from them about operating in this country. The two stalwarts are of course the Taj and Oberoi brands but added to these would be the newer entrants like The Leela or ITC groups.

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Published: 04 Apr 2013, 04:09 PM IST
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