The Ripple Effect: How Events Shape the Hotel Industry's Fortunes
by Komal Parmar Industry Watch | December 7, 2023 | Feature
In the dynamic world of hospitality, the fate of the hotel industry is often intricately tied to the rise and fall of events – from the joyous anticipation of festivals to the disappointment of cancellations. This delicate dance between events and hotel bookings is exemplified by recent developments in Shantiniketan's Poush Mela and the upcoming inauguration of the Ram Mandir in Ayodhya.
The Cancellation Blues: Poush Mela's Impact on Hoteliers
The decision by Visva-Bharati and Santiniketan Trust to cancel the iconic Poush Mela in Shantiniketan this year has sent shockwaves through the hospitality sector. Tourists, eager to immerse themselves in the cultural festivities, had already secured hotel bookings at elevated tariffs. Now, with the fair called off, many find themselves in a quandary, seeking refunds or revised rates.
Anuradha Banerjee, a college professor, expressed her frustration, stating, "I had paid INR 1,500 for a double bed room, but for the Poush Mela dates, I had to pay INR 4,000. Now that the fair is canceled, the hotel refuses to refund the extra money." This sentiment is echoed by others, highlighting the challenges faced by both tourists and hotel operators.
Chandranath Banerjee, secretary of Bolpur Santiniketan Hotel Owners Association, laments the potential loss, saying, "More than 50 percent of rooms in Bolpur are already booked. But we were expecting a full booking during the period. With the fair canceled, we fear tourist numbers will not meet our expectations."
The Rise of Ayodhya: Anticipating the Ram Mandir Boost
In stark contrast, the anticipation surrounding the inauguration of the Ram Mandir in Ayodhya tells a different tale for the hotel industry. As the countdown to the much-awaited event narrows, hotel chains and investors are strategically positioning themselves for a surge in demand.
Leading hotel chains such as Indian Hotels Company Limited (IHCL), Marriott International, Sarovar Hotels & Resorts, and Wyndham Hotels & Resorts have committed significant investments. Estimates suggest a whopping INR 350 crore worth of investments in hotel development in Ayodhya. JLL anticipates the opening of five branded hotels comprising 520 rooms post-2024, indicating a substantial influx of organized supply.
Ajay K Bakaya, MD of Sarovar Hotels & Resorts, emphasizes the competitive advantage of early movers, stating, "Every chain we know of has signed or is talking of signing hotels in Ayodhya. Early movers will have an advantage." The UP Housing and Development Board's recent invitation for the e-auction of hotel plots in Ayodhya further underlines the industry's bullish outlook.
Poush Mela Cancellation: A Cautionary Tale
The cancellation of Poush Mela illustrates the vulnerability of hotel bookings tied to specific events. It not only disappoints eager tourists but also leaves hoteliers grappling with potential losses and customer dissatisfaction. The aftermath highlights the need for flexible booking policies and proactive communication in such situations.
Ram Mandir Inauguration: A Beacon of Hope
Conversely, the upcoming inauguration of the Ram Mandir showcases the hotel industry's ability to capitalize on significant events. Hotel chains are aligning their strategies with the expected surge in demand, demonstrating how a major event can be a catalyst for growth, attracting investments and fostering a competitive landscape.
Navigating the Ebb and Flow
In the world of hotels, events wield a powerful influence, shaping the industry's fortunes with each announcement or cancellation. The tales of Poush Mela and the Ram Mandir inauguration serve as poignant reminders of the symbiotic relationship between events and hospitality. As the industry adapts to the ever-changing landscape, flexibility, strategic planning, and a keen understanding of market dynamics will continue to be the keys to success.
The fate of the hotel industry is often intricately tied to the rise and fall of events – from the joyous anticipation of festivals to the disappointment of cancellations.