Deepa Harris, senior vice president of Taj Hotels Resorts and Palaces, reveals how the luxury hospitality brand draws on India’s rich heritage to nuture its future.
It’s an interesting time for Taj Hotels Resorts and Palaces, the luxury hospitality subsidiary buried within Mumbai-based Tata Group, and effectively the ‘public’ brand representing The Indian Hotels Company Limited.
Between 2011 and 2012, turnover grew by 8%, driven by an increase in average daily rooms sold, including a capacity increase of seven hotels, adding 971 rooms to the portfolio. Food and beverage sales increased by 11% driven by an increase in culinary offerings as well as a stable banqueting business.
But Taj more recently made headlines when The Indian Hotels Co. – effectively the same company – launched a $1.86 million unsolicited takeover bid for fellow luxury hotelier Orient-Express.
Indian Hotels Co. currently holds a 6.9% stake in the group, but recently offered $12.63 a share in cash – a premium of close to 40% at time of offer – to acquire the remaining 93%. The bid was ultimately rejected by the Orient-Express board, which criticised the offer as undervalued and ill timed.
“ Taj more recently made headlines when The Indian Hotels Co. launched a $1.86 million unsolicited takeover bid for Orient-Express ”
The move would have added properties such as Hotel Cipriani in Venice, Grand Hotel Europe in St Petersburg, Mount Nelson Hotel in Cape Town and Copacabana Palace in Rio de Janeiro to a predominantly Indian focused portfolio of hotels and palaces.
Though Taj has expanded to include properties in the United States, United Kingdom, Africa, Australia, Sri Lanka and the Maldives, it controls an overwhelming 93 hotels in 55 locations across India, and continues to count the affluent Indian traveller as part of its core global consumer group.
“Whilst growth has been slower on account of the global economy and a general decrease in demand combined with excess supply in certain cities, we strongly feel that India continues to be attractive as a destination for both business and high end leisure.
The Taj Mahal Palace, Mumbai
“Our ultra luxury properties are performing the best primarily India and the Indian Ocean region. In India our Grand Palaces in Rajasthan and our city luxury hotels like the iconic Taj Mahal Palace and Taj Lands End in Mumbai. The Taj Mahal in Delhi, Taj West End in Bangalore and Taj Bengal in Kolkata continue to do well.
“Besides Indians, it’s the Americans and Europeans that drive the business and all our offerings and facilities are suited to these nationalities. A great deal of emphasis is given to customising cuisine and service around cultural sensitivities.
“60% of our revenues come from Business and the balance from leisure, and our portfolio is also divided similarly with a range of city hotels and authentic palaces, luxury resorts and high-end wildlife lodges.”
Though Taj Hotels was incorporated as early as 1903, with the opening of the opulent Taj Mahal Palace Hotel, the group has gone on to diversify its portfolio and positioning to reflect the changing nature of the global luxury traveller.
“ 60% of our revenues come from business and the balance from leisure, our portfolio is also divided similarly ”
Of prime importance is the introduction of the Vivanta by Taj brand – which already commands over twenty properties – which was launched as IHCL’s way of “getting ready for the future” where markets will be more fragmented in a brand sense.
“Vivanta by Taj is targeted at the global cosmopolitan traveller,” explains Ms. Harris. “Vivanta by Taj is an output of the brand architecture exercise undertaken by the Taj to clearly define and re-iterate its proposition to its target audiences as it expands its global footprint.
“We believe that the Indian market today is at the right level of development to be able to understand and accept tiers of brands in the hospitality industry. That is what we are offering in this market.
“The Vivanta by Taj customer appreciates luxury but in a more contemporary, minimalist and informal way. Vivanta customers appreciate style and sophistication and see themselves as connoisseurs. They lead an ‘always on lifestyle’ with no demarcation between work and play.
Taj Falaknuma Palace, Hyderabad
“They love to experiment, being pleasantly surprised and greatly appreciate creativity. Thus the typical Vivanta by Taj customer is not restricted to either sex or by nationality. They are contemporary global citizen.”
As affluent consumer segments begin to augment, so too does the way they choose to access information and ultimately, book hotels. Resultantly, Taj has embraced not only the eCommerce space but social media tools such as Facebook and Twitter, often for individual properties.
“There is a definite shift towards the online space with a majority of business being influenced and driven through online platforms. Social media is emerging as the next frontier that drives brand reputation and resultant preferences.
“Yet in India, the sales process is still largely driven by direct relationships, followed by Travel Agents, Third party sites, GDS and internet. However this changes in other markets where GDS, Third Party Sites and website play a bigger role.
“ We believe that the Indian market today is at the right level of development to be able to understand & accept tiers of brands in the hospitality industry ”
Though Indian luxury brands are slowly making their mark on the international stage, Taj remains one of a select few to achieve truly global recognition. According to Ms. Harris, much of its global success and unique value proposition is a direct result of its proud Indian heritage and dedication to training.
“An ancient Sanskrit saying, “the Guest is God,” summarises our philosophy of hospitality. We welcome guests as if into our homes, with the utmost care and respect. All of our associates embrace this philosophy on a daily basis.
“We support their commitment by offering comprehensive training programs at every level. We have established numerous skill centres, awards and rewards to inspire and recognize excellence, and launched a Hospitality School to ensure they have every tool they need to succeed.
Taj Falaknuma Palace, Hyderabad
“We also strive to preserve the past to enlighten the future, energizing a revival of appreciation for skilled craftsmanship and restoration of art and historic, iconic buildings.
“We have painstakingly restored 10 authentic Indian palaces, all once or still home to royalty, to preserve an intimate glimpse into the past while also offering significant employment opportunities for a wide range of skill sets.
“Our Khazana Boutiques, including the newest in London, showcase the work of local Indian artisans who create magnificent textiles, jewellery and more using time-honoured traditions that have been preserved for the next generations through sales of these products. Our front of the house staff in many hotels wear custom attire designed and crafted by Benares weavers using ancient techniques.”
“It’s not surprising that, with a parent company born in India, a country with more than 5,000 years of history, we revere tradition to nurture our future. “
For more in our series of conversations with Luxury Leaders, please see our most recent editions as follows: