CONSUMER PERCEPTION TOWARDS 3 STAR HOTELS

Made by-PRIYAVANSH SINGH(114)

KUNAL MEHRA (69)

WHAT IS CONSUMER PERCEPTION?

Introduction: The Indian Hospitality Sector is witnessing one of its rare sustained growth trends. Hotel industry is inextricable linked to the tourism industry and the growth in the Indian tourism industry has fuelled the growth of Indian Hotel Industry. A major reason for the demand for hotel rooms is the underlying boom in the economy, particularly the growth in the information technology enabled services and information technology industries. Rising stock indices and new business opportunities are also attracting foreign institutional investors, funds, equity and venture capitalist. The financial year 2008 – 09 was an unforgettable one for the Indian tourism industry with the Mumbai terror attacks and the global economic downturn affecting the industry’s performance. The Hotel Industry, too, observed an overall decline in occupancy and revenue in most cities in India.

INDIAN HOTEL INDUSTRY

Classification of Hotels

1. Star Category Hotels: 5 Star Deluxe, 4 Star, 3 Star, 2 Star, 1 Star.

2. Heritage Category Hotels: Heritage Grand, Heritage Classic & Heritage

Basic.

Statistical Data – Indian Hotel Industry

Size of the Hotel Industry USD 3.8 Billion

Share of premium segment in the overall hotel market (2008)

USD 2.3 Billion

Expected growth rate from 2008 to 2009

12 percent

Key Players Leela Ventures, ITC Hotels, Oberoi Hotels, Bharat Hotels,

ITDC, Kamat Hotels.Rooms

Current Supply Current Demand

About 110,000 hotels rooms About 150,000 hotels rooms

Hotels Classification – Occupancy

PARTICULARS 2004-05 2005-06 2006-07 2007-08 2008-09

OVERALL AVERAGE

69.0 % 71.5 % 71.4 % 68.8 % 60.3 %

5 STAR DELUXE

71.4 % 73.8 % 73.0 % 71.7 % 62.3 %

5 STAR 71.1 % 70.4 % 70.2 % 67.2 % 59.9 %

4 STAR 71.8 % 72.7 % 71.7 % 68.9 % 59.5 %

3 STAR 56.7 % 65.9 % 68.9 % 64.7 % 57.5 %

LITERATURE REVIEW

MUMBAI, NOV 26: 3-star hotels drive 50 per cent online bookings in India within the tariff slab of Rs 1,500-Rs 3,500, according

to a travel report. The affordable average price point and online availability are the key reasons for travelers opting for this category of hotels, the report by online travel portal Go ibibo said.

The report also shares insights on average price points of various star rated hotels, break down of leisure versus business hotels booked online, customer segments and top destinations for business hotel bookings.

While leisure hotels are found to comprise of 56.41 per cent bookings, business hotels fall slightly back at 43.59 per cent. Bangalore is found to be the busiest business travel destination due to more online visibility of hotels from this city followed by Mumbai and Hyderabad. SMEs and individuals clearly outrival corporate in terms of driving these bookings. “This is because SMEs are the most price-conscious segment and are seeing value in booking online,” the report said. Also, they get transparent information and better value than the intermediary channels.

The report also captures qualitative aspects such as top factors that make people unhappy during their stay and also the important elements that travelers look forward to from a hotel. Extra beds, health forceps, kids’ area and food preferences in terms of vegetarian or non-vegetarian make up the most common hotel requirements that guests demand. On the other hand, unhygienic bathrooms, uncomfortable bed mattresses and external noise factors seem to distress guests most often.

According to industry reports, hotels is the fastest growing vertical in the online travel business. 3-star and below segment of hotels have the largest and the most fragmented supply in India. It is this fragmentation that creates huge opportunity for driving e-commerce between thousands of these hotels and travellers.

Ashish Kashyap, CEO, ibibo group said, “Hotels is one of the fastest growing segment for Goibibo. There is a lot of headroom for growth in this segment with the ecosystems getting established.”

nivedita.ganguly@thehindu.co.in

DATA INTERPRETATION AND ANALYSIS

FOOD & BEVERAGE

MENU VARIETY

Several hotels, both in the luxury and budget sector, opt to outsource their food and Beverage operations. This trend it set to increase as already established brand become more secure revenue option and also the hotel then avoids the cost of running a restaurant. It has been accepted that a critical hindrance in the future development of the hotel catering sector is the shortage of food service specialists, who are able to propel the market forward, manage the food and beverage business efficiently and develop effective marketing techniques. This is the main reason for the for the insufficient menu variety in the three star category.

EXCELLEN22%

GOOD28%

FAIR33%

POOR17%

MENU VARIETY

VALUE FOR PRICE PAIDThe prices for food and beverages charged in three star hotels are neither too low nor too high because of the limited variety of food and beverages offered. This is the main reason why we have got a moderate response from the customer regarding the value for the price charged from them. The respondents participated in the survey are not unhappy for the value they got, at the same time they are also not delighted by the experience. Respondents added that the concept of low-cost services should not be attributed with a low-quality level of service, but with value for money products that satisfy its consumers.

EXCELLEN29%

GOOD36%

FAIR32%

POOR3%

VALUE FOR PRICE PAID

PROMPTNESS OF SERVICE

During our research for promptness of service by the employees to the guest, we found that a major chunk of the respondents are unsatisfied with the service of the employees. There are various factors responsible for this situation:Three star hotels majorly recruit unskilled staff for their restaurant services.No major action has been taken for the training of the staff.Staff not following the standard operating procedures.Delayed in room dinning services.Human resource department missing in most of the three star hotels. 

EXCELLEN15%

GOOD30%

FAIR20%

POOR35%

PROMPTNESS OF SERVICE

QUALITY OF FOOD

The global food service industry is enormous and complex. The Food and Beverage sector in different category of hotels plays a different role. The way in which a luxury hotel plans and strategizes its F&B department is different from that of a budget hotel. According to the respondents participated in the survey budget hotels, pay little or no importance to catering, this can be a major reason for the dissatisfaction of the respondents.

EXCELLEN20%

GOOD32%

FAIR25%

POOR23%

QUALITY OF FOOD

OVERALL AMBIENCE OF THE ROOM

DECORThree star category hotels do not pay proper attention towards the décor of the room. This is because most of the guests coming in these hotels do not stay for more than 2 days on an average, as most of them are transit guest who require a short stay in the hotels. These hotels are considered as bed and breakfast hotels. It is important to note that official publications ignore many forms of accommodation, such as guest houses, non serviced accommodations and motels, which reflect the lack of interest by authorities in low-cost services.

  

EXCELLEN25%

GOOD31%

FAIR11%

POOR33%

DÉCOR

CLEANLINESS/HOUSEKEEPING

Three star category hotels are less concerned about the cleanliness of the rooms and public areas. According to the respondents there is no proper housekeeping staff available in these hotels; also the management does on lay any emphasis on it. There is a routine cleaning of the rooms and the public areas which is done once in a day. From the above figures we can say that the guests are unsatisfied.

EXCELLEN22%

GOOD34%

FAIR16%

POOR28%

CLEANLINESS

EXCELLEN18%

GOOD37%FAIR

14%

POOR31%

HOUSE KEEPING SERVICE

HEATING AND COOLING WITHIN THE ROOM

It is clearly mentioned from the above figures that the heating and cooling facilities in the rooms are unsatisfactory. More than half of the respondents in the survey had given a very poor response regarding these facilities.

EXCELLEN13%

GOOD24%

FAIR19%

POOR44%

HAETING/COOLING WITHIN ROOM

FRONT DESK

RECEPTION

This is a place where guest comes in direct contact with the hotel staff. This should be the most important place in a hotel because it creates a first impression of the hotel in the mind of the guest. But as the above figures shows that the respondents participated in the survey are having mixed reactions for the reception service. as per the above figures There are nearly equal no of respondents satisfied and dissatisfied in this category.

EXCELLEN28%

GOOD29%

FAIR16%

POOR27%

RECEPTION

CONCIERGE

There is a separate counter in 5-star hotels which deals with the extra services required by the in house guests. These services can be transport facilities, entertainment facilities, arrangement of movie tickets, concerts and various others. According to the respondents participated in the survey they are very dissatisfied with the concierge services as most of the three star hotels does not have a concierge counter. Moreover when the guest asks for these special services they are not entertained.

EXCELLEN16%

GOOD23%

FAIR39%

POOR22%

CONCIERGE

BUISNESS AIDING ADD ON FACILITIES

INTERNET/WIFI

As in case of the 3 star hotels there are very less hotels having wifi facilities due to which it becomes difficult for the people to do their work. So as per the results we can also state that the people are not that happy with this service.

EXCELLEN25%

GOOD42%

FAIR10%

POOR23%

INTERNET/WIFI

MEETING ROOM

Meeting room is very essential for the consumer who is coming for the business purpose but in case of 3 star hotels very less hotels provide that service due to which consumer are less satisfied with the 3 star hotels for this purpose.

EXCELLEN11%

GOOD28%

FAIR31%

POOR30%

MEETING ROOM

CHECK-IN-FACILITIES

TIME TAKEN FOR CHECK IN

Sometimes hotels staff are not that much trained to attend the customer which leaves a bad impression on the consumer and also they take too much time at check in because of which they are not satisfied which creates a perception in their mind. Therefore for the next time they avoid that hotel.

EXCELLEN31%

GOOD22%

FAIR27%

POOR20%

TIME TAKEN FOR CHECK IN

ROOMS READY ON ARRIVAL

This factor plays a very important role for the consumer as they want that the room should be ready on their arrival. But as per the findings fewer consumers were satisfied with the service due to which response was not that great.

EXCELLEN38%

GOOD28%

FAIR11%

POOR23%

ROOMS READY ON ARRIVAL

Solutions:SUCCESS FACTOR FOR BUDGET HOTELS

Site & location

Positioning

Financial flexibility

Brand equity

Recommendations

Competitive Pricing Single Room Charges- Rs. 1000 Double Room Charges- Rs. 2000. The customers were entitled to a discount of Rs. 50 if booking is made

through internet. This practice will help to cut their marketing costs which contributes to

10% -15 % of room costs.

SPECIAL OFFERS Early Booking Offer:- “SAVE NOW” Book Early and Pay Less. Last Minutes Rates:- Sensational last minutes rates in their top

destinations. Day Use Rates:- Introducing special day use rates for travelers to

freshen up or relax before heading to work. Coolest Offer Packages:- Visit most popular destination starting at just

Rs. 2799/- onwards.

FACALITIES

Facilities and services should be intelligently designed for customers comfort and convenience.

It provides:- meeting room, conference room, restaurant and WiFi and net zone self checking safe zone CCD, water dispenser 20 inch flat-TV in each room with satellite channel Mini fridge 24 hr hot /cold water

CORPORATE ADVANTAGES

Optimizes costs:- Enjoy special customized rates. Enjoy exciting facilities. Convenience and peace of mind:- suitable location, rooms are

hygienic, peaceful & comfortable. Consistency:- Uniform standard in services. Hassle free reservations. Transparency in booking system.

Conclusion

The hotel industry is maturing, getting right there where the growing economy is driving it. The supply of hotels is set to increase and a few years from now, it is expected to match the demand. As a result, prices will stabilize and become more realistic, Pricing is also expected to become more in sync with the quality of product and also its delivery, both getting equal recognition among providers as well as the end consumers. The hospitality sector will therefore begin to offer truer value for money. The hotel product will be offered more transparently in the market, it will become more international in its appeal and offering.

The increasing demand and pressure for excellence is resulting in India beginning to create some of the best hotels and resorts. Many of the world's leading hotel chains have entered the Indian market and more are coming in. Thus, a wider range of hotels, catering to various niches, and segments, will come around. India's hotel industry in ten years time will adhere to international best practices.

  The results from the findings state that the consumer perception towards 3 star

hotels is not good because of the services they are providing. So as from the above paragraph it is saying that the hotel industry is growing so the 3 star hotels should improve their performances to satisfy their consumers and change their perception.