BREVISTAY

CASE STUDY

SUBMITTED BY:

AKANSH SINGHAL (190103019 )

MAYANK GARG (190103211)

HARSHIT MITTAL (190103182)

APURAV GUPTA (190103033)

GARIMA GAUR (190101047)

 BREVISTAY

(Strategy in Making)

‘’Strategy is about making choices, trade-offs; it’s about deliberately choosing to be

different ’’- Michael Porter.

The rising middle class and increasing disposable incomes have continued to support
the growth of the domestic and outbound tourism and hospitality industry, which have
emerged as key drivers of growth among the services sector. India is one of the most
technically advanced nations in terms of using digital tools for planning trips. Multiple
digital platforms allow customers to book hotels instantly. However, the hospitality
industry has always been rigid in its approach, be it 12-hour check-ins and check-outs
or conventional admission policies. Customers have always faced this menace of
having to pay extra charges owing to untimely check-outs. Relaxation isn’t really what
you get when such regulations bind you down.

Fortunately, a few start-ups are addressing these problems. BreviStay is one such
venture that makes stays easier and hotels friendlier for customers. It ensures
convenience to travelers by allowing flexible check-ins and check-outs and providing
them the choice to choose their check-in times. It is a novel change from the existing
12-hour check-out system, as it gives an opportunity to books room on an hourly basis.

‘Short stay, safe stay’ is their motto and they live by it.

Just like how this platform is unique in every way, the story of Brevistay came to be is
also quite a tale.

Some Current Problems Faced by Brevistay are:

1. Competing with Prominent players and Expanding its customer base in the
metro cities.

2. Increase the rate of acquisition of partner hotels. 250 hotels were partnered
with
in 2 years. Target is to double this rate and reach 500 hotels in 2 years.

3. Breaking the taboo associated with the hourly booking of rooms.

Long Term Implications:

Brevistay is not able to generate high revenues and desired funding from big
organizations. Because of the taboo associated with the hourly bookings, the major
customer base is reluctant to book. If current problems will maintain over a period of
time, then it will be a great loss for the business of Brevistay and it will not be able to
make its mark in the market.

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 About Brevistay:

BreviStay is a Noida-based start-up that began its journey with just five cities including
Delhi and Lucknow and is now operating in 16+ cities all over India. They offer a unique
service called ‘Micro stay’ that challenges the traditional set up of the hotel industry. A
‘Micro stay’, as the name suggests, is a short stay. Be it a flight delay, a brief layover
or a short meet with a client, travelers who had to stop by for a few hours were forced
to book rooms for entire 24-hour duration and pay hefty amounts. BreviStay
acknowledged and challenged this notion by introducing the hourly booking of hotel
rooms. Customers are empowered, as they can rent hotel rooms for 3,6 or 12 hours
and pay accordingly. Besides providing rooms by the hour, they also ensured that
customers who wanted to use hotel lounges, swimming pools or other luxurious
services in a hotel for few hours only, enjoy all these facilities at affordable prices.

The best way to draw attention to a new venture is by actually doing something
positive for the customers. It requires more effort, but it’s far more cost-effective and
can help build a loyal base of the brand. BreviStay reined in this concept by addressing
the need for privacy by unmarried couples who are restricted from renting rooms at
most hotels.

Booking a hotel room for a couple of hours is something that still draws shame and
disgrace. Couples with local IDs are unable to book rooms in hotels. Although it is a
taboo prevalent in India, there is no law that prohibits unmarried couples from staying
in the same room irrespective of the city they belong to. BreviStay has taken the onus
to educate hoteliers about the legal aspects of these scenarios and move towards a
progressive change. This is also creating an enormous impact on society.

Unmarried couples can easily book hotel rooms through BreviStay for few hours if they
have valid ID proofs of either the same city or any other city. The hotel management
ensures their safety and security and provides a hassle-free check-in check-out
routine with no questions asked.

BreviStay targets tourists on the go, business travelers, students traveling for
admissions, examinations or interviews and couples. Their major revenue comes from
the following fractions:

 Corporate travelers journeying for short durations

 Tourists seeking hotels near airports, stations, service areas and ports to wait
for their delayed departures/arrivals
 People requiring hotels near hospitals to stay in case of an emergency
 Naps or time-out for spa and relaxation
 People looking for staying by after a short trip who arrived due to concerts,
festivals or other similar events
 Youngsters on short getaways
 Breaks for leisure and time-out in your own city
 Couples seeking privacy along with an assurance of safety

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 EXCERPTS OF INTERVIEWS OF BREVISTAY EMPLOYEES

Interview 1

1.) How do you feel people consider hourly stays?

- There is still a taboo with the bookings of room on an hourly basis.

2.) Does OYO posses a competition for the company?

- No, right now there not much of a threat from OYO as they have recently come up
with hourly packages but cost really pays a role here, where right now brevistay is
the leader.

Interview 2

1.) How does the plan to expand to new geographies?

- Till now the response has been immense, we have now zeroed in on tier 2 and 3
cities for expansion based on our resources and capabilities and we are avidly
working on its strategy formulation.

2.) Is the company willing to partner with corporations or other entities?

- No, right now there is no word on this in the company, maybe we can consider it in
the future.

Interview 3

1.) Would you yourself consider booking the brevistay facility?

- As a truth, initially I would not but been here and working in the company I will
always book the facility if possible for my family.

2.) How likely would you recommend brevistay on a scale of 10?

-Since I work here and know about the company I would give it a 7.

Interview 4

Q. What kind of marketing does the company do?

- We depend more on word of mouth as we prefer serving our customers in the best
possible ways so that they will come back in the future and will spread a positive
word about us.

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 Industry Analysis

The Indian tourism and hospitality industry has emerged as one of the key drivers of
growth among the services sector in India. Tourism in India has significant potential
considering the rich cultural and historical heritage, variety in ecology, terrains, and
places of natural beauty spread across the country. Tourism is also a potentially
large employment generator besides being a significant source of foreign exchange
for the country. During 2018, FEEs from tourism increased by 4.70 percent* year-on-
year to US$ 28.59 billion. FEEs during January 2019 was US$ 2.55 billion.

Market Size:

India is the most digitally-advanced traveler nation in terms of digital tools being used
for planning, booking and experiencing a journey, India’s rising middle class and
increasing disposable incomes has continued to support the growth of domestic and
outbound tourism.

During 2018, foreign tourist arrivals (FTAs) in India stood at 10.56 million, achieving
a growth rate of 5.20 percent year-on-year. FTAs in January 2019 stood at 1.10
million, up 5.30 percent compared to 1.05 million year-on-year. During May 2019,
arrivals through e-tourist visas increased by 21.70 percent year-on-year to 1.23
million.

The travel & tourism sector in India accounted for 8 percent of the total employment
opportunities generated in the country in 2017, providing employment to around 41.6
million people during the same year. The number is expected to rise by 2 percent
annum to 52.3 million jobs by 2028.

International hotel chains are increasing their presence in the country, as it will
account for around 47 percent share in the Tourism & Hospitality sector of India by
2020 & 50 percent by 2022.

India’s travel and tourism industry have huge growth potential. The tourism industry
is also looking forward to the expansion of the E-visa scheme which is expected to
double the tourist inflow to India. India's travel and tourism industry have the
potential to expand by 2.5 percent on the back of higher budgetary allocation and
low-cost healthcare facility, according to a joint study conducted by Assocham and
Yes Bank.

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PORTER 5 Force Analysis of Tourism and Hospitality Industry:

1. Rivalry Among Existing Competitors:

 The Indian hospitality sector is

highly fragmented with a large
number of small and
unorganized players; this
increases competition
 Customers’ low switching cost
and price sensitivity are
increasing competition among
players
 Therefore, Competitive Rivalry
is High

2. The threat of New Entrants:

 Entry is easy as it is not capital

intensive, but a player needs
to achieve economies of scale
and access to distribution
channel to compete

 Therefore, the Threat of New

Entrants is Moderate

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3. Bargaining Power of Suppliers:

 There is the threat of

forward integration; for
instance, the airline
starts selling directly to
customers

 The cost of switching

suppliers is low

 Therefore, the
Bargaining Power of
Suppliers is Moderate

4. Bargaining Power of Buyers:

 Low switching cost

gives customer high
bargaining power

 Customers are price

sensitive and have
information about the
services being provided

 Therefore, the
Bargaining Power of
Buyers is High

5. The threat of New Substitutes:

 The threat of substitute

products is minimal as no
substitutes are available in
the market

 Therefore, the Threat of

Substitute Products is low

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PEST ANALYSIS OF HOTEL INDUSTRY IN INDIA:
POLITICAL
 The hotel industry, as well as the
tourism industry, has a basic
backbone of government support
without which it won’t be able to
sustain the competitive world.
 The government charges a huge
amount of tax from the star and
luxury category of hotels and thus
has a huge impact on the political
changes that occur.
 Any small step was taken by the
government by changing some law
it would seriously affect the hotel
industry.
 The hotel industry is getting huge
incentives and the state
governments are supporting the
development of the hotels and their
growth.
SOCIAL
Threat:
 Lifestyle trends; Increased or
Decreased amount of travel.
 Ethical Issues such as irresponsible
hosts or travelers causing bad
publicity and jeopardizing the
image of the business.
 Media highlighting the low-quality
aspect of business
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ECONOMIC
 As seen in the recent past the
guests are willing to pay for the
services they get and the more the
guests pay the more would the
hotel and the industry would
prosper.
 With the increase in the paying
power of the guests, the need for
the good and luxurious hotels
become massive.
 The per capita income in India also
has risen to a new extent enabling
the common man to go to luxurious
hotels to have lunch or dinner.
TECHNOLOGICAL
Opportunity:
 An ever-increasing amount of users
accessing the internet to shop for
hotels and lodging.
 Access to IT systems allowing
more efficient data collection and
extensive market research to
address other threats/weaknesses.
Online Hotel Booking:

The area of online hotel bookings holds one of the largest growth potentials within
the hospitality and travel sector. Gross hotel bookings, which stood at $7.2 billion in
2016, are poised to grow to $10.9 billion by 2020, while the percentage of bookings
made online will increase to 28% from 19%. Moreover, with the increase in
smartphone penetration and digital payments usage, the online hotel segment has
the potential to generate about $2.3 billion in gross bookings by 2020 and as much
as 78% of the overall online hotel bookings will be routed through OTAs, throwing up
a $2.3 billion opportunity for such businesses. By 2020, one in three hotel rooms will
be booked online – a clear indicator of the growing importance of digital in travel
research, planning, and booking.

In terms of demographics, users in the age group of 35 – 44 are the savviest when it
comes to booking hotels online, displaying the highest numbers. On Google search,
hotel searches from mobile saw 30x growth from 2011 to 2014. Payment for hotels
still seems to be a majorly offline activity, as two-third of Indian travelers prefer to
pay offline while half of them pay directly at the hotel.

Short duration trips are also on the rise in India, as leisure travelers prefer more than
2 or more trips in a year, with 64% travelers preferring short trips of less than 5 days.

As penetration increases in tier II/III cities, budget hotels, and homestays have also
become important. Almost two-thirds of India’s rooms supply in 2020-21 will
comprise of budget hotels. It is one of the most popular with users in India, with 49%
users booking budget hotels, 32% of users book economy hotels and 19% users
book luxury hotels. Friends emerged as the most preferred travel companions at
37% followed by family at 31%.

In terms of barriers to booking hotels online, safety and trust were the top deterrents.
Low trust is cited as the major deterrent in online portal offerings. Complicated terms
and conditions, concerns about online cancellation policies, better rates and
discounts available offline and personalized service were cited as the other reasons
for users to book hotels offline.

The sector is also witnessing increased competition, a high cash burn rate, and
reduced margins. MakeMyTrip is the largest OTA in the country and commands a
market share of 41% in the online travel space. Yatra and EaseMyTrip, as well as
accommodation start-ups such as Oyo, among others, are stepping on the gas to
grab a lion’s share of the market. In addition, metasearch engines like TripAdvisor,
which operate like travel discovery platforms have been able to establish their
presence in the Indian market and this segment is also expected to attract
competition in the coming times.

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With OTAs and online accommodation booking services starting loyalty schemes, its
market share compared to the direct bookings channels from branded hotels is
expected to improve drastically. Overall, the Indian hotel industry is expected to
register a huge surge in online bookings and the low penetration levels coupled with
the increasing smartphone and internet usage is expected to turn it into a big
opportunity for home-grown start-ups and international brands alike.

Some of the Direct Competitors of Brevistay are:

 Oyo Rooms
One of the unicorns of India, Oyo offers standardized service across hotels
associated with it. It has an ever-growing network with a high spirit of
innovation. It further subsidizes hotel stays for customers and is led by a team
that is young and adds freshness to the approach taken. In 2019, OYO
reported 3.5x growth in revenue in FY 2017–18 at Rs 416cr for India
operations and a marginal loss of 360 cr. In 2018, OYO reported a loss of
330.97 cr which was better than the previous year.

 StayUncle
Operating in 40 cities at the moment with more than 800 Hotels to date,
StayUncle's bold concept has been reported on across numerous national
and international channels including The Discovery Channel and BBC.
They bragged over $3million in revenue by 2019 end. Their product now is
more robust, more interactive and powers some unique features unseen in
other hotel booking portals. They have paired the Superfasts Checkin with
Express Checkout which lets the hotelier be notified when the guests are
ready to checkout and complete the checkout time in the hotel room. This
diminishes the time a couple has to spend at the reception by 90%.

 Goibibo
Goibibo is India’s leading online travel booking brand providing a range of
choices for hotels, flights, trains, bus and cars for travelers. Our core value
differentiator is the most trusted user experience:
1. Fastest Travel Booking
2. Fastest Refunds
3. Dedicated Customer Support
4. Large Inventory and Latest Technology
5. An engaging User-Interface
6. Best Offers and Lowest Fares,
7. Hotel Bookings and Convenient and Easy Bus booking
8. With industry-first virtual travel booking currency goCash and travel social
network, goCash+ Rewards

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SWOT Analysis of Brevistay:

Strength:

 Affordable
 Welcomes Everyone i.e Singles, Unmarried Couples
 high-class Facilities
 Flexible Stay Packages
 Growing Network

Weakness:

 Tight Margins
 Less Funding
 Taboo for hourly stay for unmarried couples

Opportunities:

 People want to value benefits and want to minimize spending. Thus Hourly
Booking facility provides a great scope
 Increase in the number of business travelers. Therefore Corporate Tie-ups is
a viable option

Threats:

 High Competition from Big Players like OyoRooms & Goibibo

 Increased Concern over safety

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 Financials

Brevistay Hospitality Private Limited's operating revenues range is Under INR 1 cr

for the financial year ending on 31 March 2018.

 It's EBITDA has increased by 243.34 % over the previous year.

 At the same time, it's book net worth has increased by 1,252.91 %.
 The total paid-up capital is INR 1.00 lac.

Operating Revenue Under INR 1 cr

EBITDA Increased by 243.34 %

Networth Increased by 1,252.91 %

Debt/Equity Ratio 1.60

Return on Equity 131.41 %

Total Assets Increased by 2,269.42 %

Fixed Assets N/A

Current Assets Increased by 1,981.11 %

Current Liabilities Increased by 873.78 %

Trade Receivables Increased by 1,589.76 %

Trade Payables N/A

Current Ratio 1.34

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 CONCLUSION

So, Brevistay faces the challenge of Competing with Prominent players, Expanding
its customer base, Increasing the rate of acquisition of partner hotels and Breaking
the taboo associated with the hourly booking of rooms.

Challenges we consider as the protagonist are:

 Being a Startup it is not able to make its name in the market

 Because of less investment in marketing, People are still not aware of the
availability of the Hourly deals

 Consumers like to enjoy hospitality services from portals which are well
known in the market considering better quality and security

Brevistay should follow the following Strategies:

1. Reposition the brevistay brand amongst the customers to gain more traction
towards it.

2. Work on their mission and vision statements so that proper strategy could be
formulated.

3. As the competitive advantage of hourly stay goes, they can tie up with
airlines and corporates and target the business people traveling to different
cities for short stays.

4. It can start with there own loyalty programs to retain customers as the cost of
retention is less than cost of acquisition.

5. To expand to new geographies, we can partner with locals and consider

options like homestays to decrease initial fixed costs.

6. Partner with platforms providing online bookings like yatra and MakeMyTrip
to gain brand awareness.

7. Can opt for a web series based on brevistay to attract millennials and bury
the taboo with hourly bookings.

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 EXHIBITS

OYO ROOMS:

GoIbibo:

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