INTRODUCTION

Introduction

As per as history of hospitality is concerned, the word hospitality is derived

from the Latin word hospes, meaning “guest, visitor, or one who provides
lodging for a guest or visitor.‖ In India, hospitality is based on the principle
―Atithi Devo Bhava”, meaning "the guest is God." Hospitality marketing is
unique because it deals with the tangible product, like a bed in the hotel or food
in the restaurant, but it also deals with the intangible aspects of the hospitality
and tourism industry. The first attempt of developing a new marketing mix for
the hospitality industry was undertaken by Leo. M . Renaghan. According to
him the hospitality marketing mix contain three major sub mixes- the product
/service mix, the presentation mix, and the communication mix. To these we
add one of the original elements defined by Borden – Distribution. Hospitality
Marketing: is illustrated as the process by which a service industry caters
service to its target customers by the various offerings the major responsibility
of hospitability service provider is to create unique mix of service offering to
cater the value demanded by the customer. ―First, you need to identify all the
key activities involved in creating and delivering the service in question and
then specify the linkages between these activities. Initially, it‘s best to keep
activities relatively aggregated in order to define the big picture.~Christopher
Lovelock, E. Jerome McCarthy in 1960 was the first to gave the concept of
marketing Mix which demanded and gain attention in late 70‘s when the
marketers acknowledge the upgradation of the marketing mix.This led to the
creation of the Extended Marketing Mix in 1981 by Bernard H. Booms and
Mary J. Bitner‟s insight in relation which added 3 new elements to the 4 P‘s
Principle. This now allowed the extended Marketing Mix to include products
that are services and not just physical component. There have been alternatives
to the traditional marketing mix offered in the marketing literature in response
to differences that exist between tangible products (i.e., goods) and services.
Services have four major characteristics that affect the design of marketing
programs: intangibility, inseparability, perishability, and variability. These
characteristics led to the creation of an expanded marketing mix for all services
with 7 P‘s -the original 4 plus physical evidence, participants/people, and
process.
INDIAN HOTEL INDUSTRY

The Indian hotel industry is becoming as one of the key industries driving
growth of the services sector in India. The fortunes of the hotel industry have
always been linked to the prospects of the tourism industry and tourism is the
foremost demand driver of the industry. The Indian hotel industry has recorded
significant growth fuelled by robust inflow of worldwide tourists as well as
increased tourist movement within the country and it has become one of the
leading players in the global industry. Trends in the Industry:

Budget Hotels as the next trigger

Medical Tourism
New avenues of growth
Shifting focus to Tier II and Tier III cities
Marketing Strategies
Emergence of Mixed Land Usage
Huge spurt of international brands
Innovative operating models

The Indian hotel industry is highly fragmented with a large number of small and
unorganized players accounting for a lion's share. The major players in the
organized segment include Indian Hotels Company Ltd, Hotel Leela Venture
Ltd, EIH Ltd, ITC Hotels and ITDC. The industry is likely to experience robust
growth on the back of rising disposable incomes and favourable industry
statistics. The market is estimated to reach US$ 30 billion by 2015. The Indian
tourism and hospitality industry has emerged as one of the key drivers of
growth among the services sector in India. The third-largest sub-segment of the
services sector comprising trade, repair services, hotels and restaurants
contributed nearly US$ 187.9 billion or 12.5 per cent to the Gross Domestic
Product (GDP) in 2014-15, while growing the fastest at 11.7 per cent
Compound Annual Growth Rate (CAGR) over the period 2011-12 to 2014-15.
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.
 INDUSTRY PROFILE
Hotel operators and observers often employ industry-wide averages as key
points of comparison and analysis for room rates, occupancy, and revenues. The
use of simple averages, however, can be misleading if one does not take into
account the possibility that a mean will be pulled in one direction or another by
extreme values. This analysis of three industry averages shows that those
averages are, indeed, subject to distortion, or skew. The analysis, which
examines figures for virtually all brand-name hotels in the United States,
determined that the means for average daily rate (ADR) and revenue per
available room (RevPAR) are skewed in a positive direction by hotels with
extremely high rates. On the other hand, occupancy is skewed in a negative
direction by a group of hotels with inordinately low occupancy levels.

Many of the extreme values are found in the top-25 markets, which have
hotels with inordinately high ADRs. Analysis of those markets shows that, once
again, the overall statistics are distorted by a relatively small set of hotels with
exceptional ADRs and occupancies. However, each of the top markets shows a
distinctive rate and occupancy pattern.
 The pattern of skewed operating statistics carries over into individual
lodging segments. The greatest distortions arise in the luxury and upscale
segments, while economy and budget hotels record more consistent (normally
distributed) statistics.

Finally, the analysis shows that although the events of created much
turmoil for the industry, the hotel business had already cooled substantially
from its record pace of a year earlier. In conclusion, managers must be careful
in applying overall industry statistics to their own situation and should take into
account the factors that distort operating statistics.

Scope of the report

At the backdrop of such a conducive business atmosphere 'Pre-feasibility Report

on Five-star Hotel Industry' attempts to examine such critical factors which will
provide vital inputs in general to the potential investors and estimation of
commercial viability of such an investment.

- It presents the market analysis of Indian hotel industry in terms of structure&

segmentation, market size, major hotels etc.

- It analyses the steps involved in setting up a hotel describing the technical

aspects in terms of locational details and land requirement.

- It assess the manpower planning and financial estimate involved in setting up

a hotel.

- Brings an insight into the procedure for setting up a hotel, type of machinery

& floors space required, requirement of regulatory permissions & clearances.

-Analysis of porter’s five forces and SWOT of the industry.

 INTRODUCTION

Global travel increased by 6% in 2007 compared with 2006, crossing tourism

forecasts for the fourth year in succession. Among the various regions, the
Middle East registered the highest growth in arrival of international tourists
with 46 million tourists compared with 41 million in 2006, a growth of
12.2%.The opening up of the aviation industry in India has resulted in exciting
opportunities for the hotel industry.

- The share of Travel & Tourism industry to the global GDP was 6.48% in the
year 2007 with value of US$ 3,493.19 billion and industry demand contributed
to 13.21% of global GDP in 2007.

- Middle East was the fastest-growing region in terms of arrivals of international

tourists during 2007.

- According to the report by World Travel and Tourism Council, India currently
ranks 18th in business travel and will be among the top 5 nations by the end of
2010.
- ASSOCHAM has projected that Medical Tourism is likely to become the
leading foreign exchange earner for India

- India is now emerging as one of the hot destinations for medical

- tourism after Singapore, Thailand, Hong Kong, Malaysia, Philippines,

Columbia

A touch of tenderness, a helping hand, a welcoming visage... the Indian

hospitality sector is certainly the most apt replication of the belief ‘ATITHI
DEVO BHAVA'.
Good quality products and services at affordable prices should be the USP of
any successful venture - and hotels in the country boast of exactly this!

According to the world travel and tourism council, the growth in the hospitality
industry is pegged at 15% every year, and with 2, 00,000 rooms (both luxury
and budget) needed in the country, the segment is poised for a stupendous
growth.

Travel tales

While the high influx of foreign tourists has ensured huge footfalls for the
sector over the years, internal tourism too has, off late, begun offering great
potential. With travelers taking new interests in the country, players in the
hospitality sector have had to offer the best of services, at affordable prices.
Also, with the USD 23 billion software services sector pushing the Indian
economy skywards, more and more IT professionals are flocking to Indian
metro cities, thus signaling a boom time for the hotel and hospitality segment.
Several other factors such as Commonwealth Games in Delhi are fueling the
need further.

The best bet

The Indian hospitality industry is projected to grow at a rate of 8.8% between

2007-16, placing India as the second-fastest growing tourism market in the
world. Initiatives like massive investment in hotel infrastructure and open sky
policies made by the government are all aimed at propelling growth in the
hospitality sector.

"Hotel and hospitality industries are among the biggest employment

generators in the country. Towards propelling its growth, while the government
should confer infrastructure status to the hotel industries, several taxation issues
also need to be rationalized. Further permits and licenses required for the hotel
operations need to be rationalised by offering a "single window" mechanism,"
says Sanjay Gupta, CMD, Neesa Leisure Ltd - the Group which boasts of
providing state-of-the-art facilities and services at its hotels.

Be it Cambay Sapphire - the elegant 3 star business hotel at Ahmedabad

or The Cambay Grand - the upcoming 5 star hotel in Ahmedabad that takes
contemporary luxury to new heights with opulent rooms and suites, exotic spa,
virtual golf, and multi cuisine fine dinning, redefining luxury is the perennial
mantra in each of Cambay's hospitality projects.

Some of the Group's forthcoming ventures include The Cambay Spa &
Resort at Neemrana, Rajasthan - a proposed five star business hotel boasting of
one of the largest conference and convention facilities, another venture of Neesa
Leisure Ltd in Dahej (SEZ) to have 100 rooms including apartment and
conference facilities and Cambay Sapphire, Jodhpur - a business hotel.
Exclusive and innovative initiatives like the Cambay projects certainly focus on
ensuring a bright future for the Indian hotel industry.

The government's decision to substantially upgrade 28 regional airports in

smaller towns and privatization & expansion of Delhi and Mumbai airport has
improved the business prospects of hotel industry in India. Also, the upgrading
of national highways connecting various parts of India has opened new avenues
for the development of budget hotels in India. Couple this with the availability
of qualified human resources and the hospitality sector has already got great
growth prospects.

BACKGROUND OF THE HOTEL INDUSTRY

The Hotel Industry comprises a major part of the Tourism industry.

Historically viewed as an industry providing a luxury service valuable to the
economy only as a foreign exchange earner, the industry today contributes
directly to employment (directly employing around 0.15 million people), and
indirectly facilitates tourism and commerce.
Prior to the 1980s, the Indian hotel industry was a slow-growing industry,
consisting primarily of relatively static, single-hotel companies.

However, the Asiad, held in New Delhi in 1982, and the subsequent partial
liberalization of the Indian economy generated tourism interest in India, with
significant benefits accruing to the hotel and tourism sector, in terms of
improved demand patterns. Growth in demand for hotels was particularly high
during the early 1990s following the initiatives taken to liberalize the Indian
economy in FY1991, as per the recommendations of the International Monetary
Fund (IMF).

The euphoria of the early 1990s prompted major chains, new entrants and
international chains to chalk out ambitious capacity additions, especially in the
metropolitan cities. However, most of these efforts were directed towards the
business travelers and foreign clientele. In recent years, the hotels sector has
grown at a faster rate than GDP. As a result, the share of hotels & restaurants in
GDP at current prices has increased from 1.2per cent in FY2000 to 1.5per cent
in FY2005.

In constant (1999-2000) prices, the GDP from hotels and restaurants has
increased from Rs. 222.65 billion in FY2000 to Rs. 335.49 billion in FY2005.
As a result, the share of hotels and restaurants in total GDP at constant prices
has increased from 1.24per cent in FY2000 to 1.40per cent in FY2005.

STRUCTURE OF THE INDUSTRY

Hotels in India are broadly classified into 7 categories (five star deluxe, five-
star, four star, three star, two star, and one-star and heritage hotels) by the
Ministry of Tourism, Government of India, based on the general features and
facilities offered. The ratings are reviewed every five years. As of December
2005 (latest available figure) there are following number and category of hotels.
 No. of Hotels No. of Rooms
Star Category

5-Star Deluxe 5-Star Deluxe 5-Star Deluxe

5-Star 92 11332

4-Star 132 9401

3-Star 704 31039

2-Star 587 19031

1-Star 212 695

Heritage 83 2216
To be 50 5127
classified
Total 1934 103973
The table excludes hotels in the unorganized sector that have a significant
presence across the country and cater primarily to economy tourists. Premium
and Luxury Segment This segment comprises the high-end 5-star deluxe and 5-
star hotels, which mainly cater to the business and up market foreign leisure
travellers and offer a high quality and range of services. The segment accounted
for 29per cent of the total hotel rooms in the country in December 2005.

Mid-Market Segment

This segment comprises 3 and 4 star hotels, which cater to the average foreign
and domestic leisure travellers. This segment also caters to the middle level
business travellers since it offers most of the essential services of luxury hotels
without the high costs since the tax component of this segment is lower
compared with the premium segment.

Budget Segment

These comprise 1 and 2 star hotels referred to as ‘Budget Hotels’. These

categories do not offer as many facilities as the other segments but provide
inexpensive accommodation to the highly price-conscious segment of the
domestic and foreign leisure travellers.

Heritage Hotels

In the past four decades, certain architecturally distinctive properties such as

palaces and Forts, built prior to 1950, have been converted into hotels. The
Ministry of Tourism has Classified these hotels as heritage hotels.
Others

At any point in time, applications for classification are usually pending with the
Ministry of Tourism because of which such properties remain unclassified. The
number of hotel rooms pending classification has declined from historical 15-
20per cent to 5per cent of the total rooms available in the recent past.

CURRENT SCENARIO OF HOTEL INDUSTRY

Over the last decade and half the mad rush to India for business
opportunities has intensified and elevated room rates and occupancy levels in
India. Even budget hotels are charging USD 250 per day. The successful growth
story of 'Hotel Industry in India' seconds only to China in Asia Pacific.

'Hotels in India' have supply of 110,000 rooms. According to the tourism

ministry, 4.4 million tourists visited India last year and at current trend, demand
will soar to 10 million in 2010 – to accommodate 350 million domestic
travelers. 'Hotels in India' has a shortage of 150,000 rooms fueling hotel room
rates across India. With tremendous pull of opportunity, India is a destination
for hotel chains looking for growth.

The World Travel and Tourism Council, India, data says, India ranks
18th in business travel and will be among the top 5 in this decade. Sources
estimate, demand is going to exceed supply by at least 100% over the next 2
years. Five-star hotels in metro cities allot same room, more than once a day to
different guests, receiving almost 24-hour rates from both guests against 6-8
hours usage. With demand-supply disparity, 'Hotel India' room rates are most
likely to rise 25% annually and occupancy to rise by 80%, over the next two
years.

'Hotel Industry in India' is eroding its competitiveness as a cost effective

destination. However, the rating on the 'Indian Hotels' is bullish. 'India Hotel
Industry' is adding about 60,000 quality rooms, currently in different stages of
planning and development and should be ready by 2012.

MNC Hotel Industry giants are flocking India and forging Joint Ventures
to earn their share of pie in the race. Government has approved 300 hotel
projects, nearly half of which are in the luxury range. Sources said, the
manpower requirements of the hotel industry will increase from 7 million in
2002 to 15 million by 2010.

With the USD 23 billion software services sector pushing the Indian
economy skywards, more and more IT professionals are flocking to Indian
metro cities. 'Hotel Industry in India' is set to grow at 15% a year. This figure
will skyrocket in 2010, when Delhi hosts the Commonwealth Games. Already,
more than 50 international budget hotel chains are moving into India to stake
their turf. Therefore, with opportunities galore the future 'Scenario of Indian
Hotel Industry' looks rosy. It is expected that the budget and mid-market hotel
segment will witness huge growth and expansion while the luxury segment will
continue to perform extremely well over the next few years.

The roles of the multinational companies are significant with their

increasing contribution to the Economy. Basically Services are intangible deeds,
processes and performances that cannot be touched, seen or felt but can be
experienced. The Service sector is characterized by its diversity. Global
opportunities are growing due to accelerated growth of the service economy.

In the hospitality industry, Average room rate (ARR) and occupancy are
the two most critical factors that determine the profitability, since most of the
marginal revenue gets added to the bottom-line. ARR in turn depends upon
location, brand image, star rating, quality of facilities, pricing of value added
services, complementary services offered and the seasonal factor. The hotels to
manage and invest their fund in India adopt many business strategies to
establish their place of business and create innovative service packages to their
custom. In a long-term perspective, these measures bring significant financial
returns.

The hotel industry in India has a latent potential for growth. This is
because India is an ideal destination for tourists as it is the only country with the
most diverse topography and relative political stability. At present India attracts
approximately 2.5 Million tourists every year, which is just 0.4% of the world
tourist arrivals.

Normally the Multi national hotels operated In India can be owned,

leased or acquired under management contract basis. Hotel operators want the
leverage on their management expertise and brand equity without making
enormous capital investment. In management contract agreements a fee
calculated as a percentage of revenue and/or operating profit is charged.
Typically, the management fee is to the tune of 3% of the total revenue and 7%
of gross operating profits.

Most players, with the exemption of IHCL and EIH, have entered into a
marketing tie-up with major international hotel chains. Thus we have Hyatt
Regency a renowned international hotel chain having tied up with AHL, Leela
having tied up with Kempinski and ITCH having a franchisee agreement with
ITT Sheraton to use the latter's brand name.

For the Indian hotel owners and the international hotel chains the benefit
is mutual, tie-up with an international hotel chain puts the hotel on the global
map with access to chain's reservation network worldwide. For the international
hotel chain they can ride on the boom of the industry without making enormous
capital investments on infrastructure and facilities. Associations with
international brand also play a major role in image building and attracting
foreign tourists. However the value of the international brand gets diluted if a
foreign entity enters an agreement with several Indian companies.

Luxury hotels operate under single tariff structure whereby the foreign
tourists are charged in dollar terms whereas the domestic guest is charged the
equivalent amount in rupees. The luxury hotels earn about two-thirds of their
revenue from foreign tourists. Leisure travelers constitute approximately 76.5%
of the total tourist arrivals whereas business travelers constitute 21% of the total
arrivals. The remainder is accounted by students. The hotel industry is the
second largest foreign exchange earner and between 1991 and 1998 there has
been a 100% growth in foreign tourists.

Hotels benefit from rupee depreciation as over 60% of revenues in the

luxury hotel segment are in foreign currencies. Thus any depreciation of the
rupee goes directly to the bottom line (FOREX income is also fully tax exempt),
as none of the costs are directly linked to the exchange rate. The hotel debt
environment is also improving. While many countries are hampered by a still
sluggish economy, those with a low interest rate environment with relatively
stable-banking conditions will provide opportunities for hotel investors to raise
capital. For hotel lenders, from a risk/return basis, there has never been a better
time to provide new capital to this industry in India.

FEATURES OF HOTEL INDUSTRY

The hospitality industry consists of companies within the food services,

accommodations, recreation, and entertainment sectors.
 The hospitality industry is a several billion dollar industry that mostly
depends on the availability of leisure time and disposable income. A hospitality
unit such as a restaurant, hotel, or even an amusement park consists of multiple
groups such as facility maintenance, direct operations (servers, housekeepers,
porters, kitchen workers, bartenders, etc.), management, marketing, and human
resources.

Usage rate is an important variable for the hospitality industry. Just as a

factory owner would wish to have his or her productive asset in use as much as
possible (as opposed to having to pay fixed costs while the factory isn't
producing), so do restaurants, hotels, and theme parks seek to maximize the
number of customers they "process".

In viewing various industries, "barriers to entry" by newcomers and

competitive advantages between current players are very important. Among
other things, hospitality industry players find advantage in old classics
(location), initial and ongoing investment support (reflected in the material
upkeep of facilities and the luxuries located therein), and particular themes
adopted by the marketing arm of the organization in question (such as a
restaurant called the 51st fighter group that has a WW2 theme in music and
other environmental aspects). Very important is also the characteristics of the
personnel working in direct contact with the customers. The authenticity,
professionalism, and actual concern for the happiness and well-being of the
customers that is communicated by successful organizations is a clear
competitive advantage

This significant growth of the tourism industry is the direct result of

changes in international consumer behaviors as well as economic prosperity and
political stability within the region. Historically, the supply of lodging facilities
within the region has proved to be both inadequate in terms of product quality
as well as insufficient in quantity for meeting the increasing levels of demand.
 These elements of supply and demand have created a favorable
investment climate for development within the region, resulting in a real estate
boom in both tourism and residential development. The growth in residential
real estate development has been primarily driven by foreign demand for
vacation and retirement homes in both urban and resort destinations within the
region. Investment and development has been further supported by the variety
of financial incentives for investment in tourism projects offered by national
governments as well as the availability of local capital for the financing of large
projects.

The first goal is to find ways to operate the hotel according to the idea of
a “triple bottom line,” which embodies profitable operation combined with
attention to the people who use and work in the hotel and a focus on careful
stewardship of resources. While that goal is important, even more vital is to use
the hotel’s position as an industry leader in the nation’s capital to demonstrate
to the hotel industry, customers, and vendors that sustainable operation is the
best strategy to ensure successful hotel operation. The sustainability initiative
goes beyond such well-known ideas as reusing guest linens, recycling waste
materials, and changing to compact fluorescent lamps.

CLASSIFICATION OF HOTELS:
Classification is based on many criteria and classifying hotels into different
types is not an easy task. The hotel industry is so vast that many hotels do not fit
into single well defined category. Industry can be classified in various ways,
based on location, size of property etc. The main hotel chains of India are: The
Taj Group of Hotels, the Oberoi Group and ITC Welcome group. Some of
the international chains are Hyatt, Marriott, and Le Meridian etc. these
properties have also come up in India now.
1. Based on location
 City center: Generally located in the heart of city within a short distance
from business center, shopping arcade. Rates are normally high due to
their location advantages. They have high traffic on weekdays and the
occupancy is generally high.
Example: Taj Mahal, Mumbai

 Motels: They are located primarily on highways, they provide lodging to

highway travelers and also provide ample parking space. The length of
stay is usually overnight.

 Suburban hotels: They are located in suburban areas, it generally have

high traffic on weekend. It is ideal for budget travelers. In this type of
hotel rates are moderately low.

 Airport hotels: These hotels are set up near by the airport. They have
transit guest who stay over between flights.

 Resort hotels: They are also termed as health resort or beach hill resort
and so depending on their position and location. They cater a person who
wants to relax, enjoy themselves at hill station. Most resort work to full
capacity during peak season. Sales and revenue fluctuate from season to
season.

 Floating hotels: As name implies these hotels are established on luxury

liners or ship. It is located on river, sea or big lakes. In cruise ships,
rooms are generally small and all furniture is fixed down. It has long stay
guest.
  Boatels: A house boat hotels is referred as boatels. The shikaras of
Kashmir and kettuvallam of kerala are houseboats in India which offers
luxurious accommodation to travelers.

 Rotels: These novel variants are hotel on wheel. Our very own "palace on
wheels" and "Deccan Odessey" are trains providing a luxurious hotel
atmosphere. Their interior is done like hotel room. They are normally
used by small group of travelers.

2. Based on Size of Property

The main yardstick for the categorization of hotel is by size the number of
rooms available in the hotel.

 Small hotel: hotel with 100 rooms and less may be termed as small
hotels.

 Medium sized hotel: hotel which has 100-300 rooms is known as

medium sized hotel.

 Large hotels: hotel which have more than 300 rooms are termed as large
hotels.

 Mega hotels: are those hotels with more than 1000 rooms.

 Chain hotels: these are the groups that have hotels in much number of
locations in India and international venues.

3. Based on the Level of Service

Hotels may be classified into economy, and luxury hotels on the basis of the
level of service they offer.

 Economy/ Budget hotels: These hotels meet the basic need of the guest
by providing comfortable and clean room for a comfortable stay.

 Mid market hotels: It is suite hotel that offers small living room with
appropriate furniture and small bed room with king sized bed.

 Luxury hotels: These offer world class service providing restaurant and
lounges, concierge service, meeting rooms, dinning facilities. Bath linen
is provided to the guest and is replaced accordingly. These guest rooms
contains furnishing, artwork etc. prime market for these hotels are
celebrities, business executives and high ranking political figures.
Example: Hyatt Regency, New Delhi.

4. Based on the Length of Stay

Hotel can be classified into transient, residential and semi residential hotels
depending
on the stay of a guest.

 Transient Hotel: These are the hotel where guest stays for a day or even
less, they are usually five star hotels. The occupancy rate is usually very
high. These hotels are situated near airport.

 Residential hotels: These are the hotel where guest can stay for a
minimum period of one month and up to a year. The rent can be paid on
monthly or quarterly basis. They provide sitting room, bed room and
kitchenette.
  Semi residential hotels: These hotels incorporate features of both
transient and residential hotel.

5. Based on Theme
Depending on theme hotel may be classified into Heritage hotels, Ecotels,
Boutique hotels and Spas.

 Heritage hotel: In this hotel a guest is graciously welcomed, offered

room that have their own history, serve traditional cuisine and are
entertained by folk artist. These hotels put their best efforts to give the
glimpse of their region. Example: Jai Mahal palace in Jaipur.

 Ecotels: these are environment friendly hotels these hotel use eco friendly
items in the room. Example: Orchid Mumbai is Asia first and most
popular five star Ecotels.

 Boutique hotels: This hotel provides exceptional accommodation,

furniture in a themed and stylish manner and caters to corporate travelers.
Example: In India the park Bangalore is a boutique hotel.

 Spas: is a resort which provide therapeutic bath and massage along with
other features of luxury hotels in India Ananda spa in Himalaya are the
most popular Spa.

6. Based on Target Market

 Commercial hotel: They are situated in the heart of the city in busy
commercial areas so as to get good and high business. They cater mostly
businessmen.

 Convention hotels: These hotels have large convention complex and

cater to people attending a convention, conference
 Example: Le meridien, Cochin, is a hotel with largest convention
center in south India.

 Resort hotels: These leisure hotels are mainly for vacationers who want
to relax and enjoy with their family. The occupancy varies as per season.
The atmosphere is more relaxed. These are spread out in vast areas so
many resorts have solar powered carts for the transport of guest.

 Suite hotels: These hotel offer rooms that may include compact
kitchenette. They cater to people who are relocating act as like lawyers,
executives who are away from home for a long business stay.

 Casino hotels: Hotel with predominantly gambling facilities comes under

this category, they have guest room and food and operation too. These
hotels tend to cater leisure and vacation travelers. Gambling activities at
some casino hotels operate 24 hours a day and 365 days

COMPANY PROFILE

About group – Clarks Inn Group of Hotels, one of the fastest growing hotel
companies in India, adds another milestone in its expanding network with its
debut in the southern state of Andhra Pradesh as it announces the opening of
Triguna Clarks Inn IN THE HISTORIC CITY OF KURNOOL. With the latest
addition, Clarks Inn now boasts of a portfolio of 84 hotels properties, including
44 in operation, spread across 18 states in India and one in kathmandu , Nepal.

Triguna Clarks Inn – A distinct hotel property, the hotel boasts of 49

aesthetically designed rooms across different categories to cater to the needs of
discerning business as well as leisure travellers. All 49 guest rooms are
epitomized by their elegant décor and are well equipped with modern and
contemporary amenities.

We are glad to offer corporate discount of 30% on published tariff(except

suite room), valid till 31st march 2019.Check in and check out time is 12.00
noon or 6.00pm. Please find the enclosure for the same.

Services and Facilities(in each room)

 In Room Minibar
 Direct Dial Telephone
 24 Hours in Room Dining
 Laundry Services
 Multichannel LCD TV
 Electronic Safe
 Work station
 Running Hot/Cold Water
 Newspaper
 Wi – fi LAN Facility
 Hair dryer(no request)
 Iron box(no request)
 24 hrs Laundry Service

The Bridge- Clarks Inn signature multi-cuisine restaurant brand ‘The Bridge’
will delight guests with its offering of Indian and international cuisines, 120
covers serving multi-cuisine delicacies. The multi cuisine restaurant has
widespread buffet &a-la carte options to choose from.

Coffee shop – 42 covers serving 24 hrs dining facility specially with local food
taste.

Banquet facility: Conference /Get-together/Marriage/Birthday party/Kitty

party etc.
Name of the Cluster Theatre Social
U Shape
Halls Seating seating function

Board Room 18-20 _ _ _

Emerald 50-60 100-120 250-300 300-350

Look forward to welcoming you and your officials at Triguna Clarks Inn.

We promise you to serve you better and want to be attentive &sensitive to your
needs. We also seek to be innovative in meeting and also exceeding your
expectations.

Should you require any assistance or have any special requirements,I shall be
glad to assist you.

Thanking you in anticipation of your patronage.

REVIEW OF LITERATURE
New Service Developments
In Today’s modern world ,competitive intensity and
customer expectations are constantly increasing in nearly all services industries
.Thus to compete with the others it becomes essential not only to provide
existing services well but also to create new approaches to service .
 It is because the outcome and process aspects of service are
often combined to create the experience and benefits obtained by customers ,
both the aspects must be addressed in new service developments.

Hierarchy of New Service Categories:

1. Major Service Innovations: These are new products for markets that have
not been previously defined. These products usually include both new service
characteristics and radical new processes .

2. Major Process Innovations: It consist of using new processes to deliver

existing core products in new ways with additional benefits.

3. Product line Extensions: These are additions by existing firms to their

current product lines .The first company in a market to offer such a product may
be seen as an innovator. These new services may be targeted at existing
customers to serve a broader array of needs to attract new customers with
different needs .

4. Process line Extensions: Creating self- service options to complement

delivery by service employees is another form of process-line extensions. They
are less innovative than product innovations but often represent distinctive new
ways of delivering existing products.

5. Supplementary Service Innovations: It takes the form of adding new

facilitating or enhancing service elements to an existing core service or of
significantly improving an existing supplementary service. Theme Restaurants,
such as the rainforest cafe, enhance the core food service with new experience.

6. Service Improvements: They are the most common type of innovations. They
involve modest changes in the performance of current products, including
improvement to either the core products or existing supplementary services.

7. Style Changes: Style changes represent the simplest type of innovation,

typically involving no changes in either process or performance.

Service Innovation Process

1. Calculation of Ideas: To conceive , assess, prioritize ideas from internal and

external sources .
2. Plan and Design: To assign design needs, to complete design and build a
rollout plan .

3. Implement: Develop test plan and implement the new idea.

4. Test: To monitor the performance of executed ideas, report the results to the
authorities and improve the process in stable operating environment.

5. Recommend: To review, approve and communicate the desired

recommendation to complete the service delivery process.

Stages in New Service Development:

The key issues involved in the development process of new services are:

1. New service development concerns all the activities involved in realizing new
service opportunities, product or service design, business model design and
marketing.

2. Services development is mostly seen as growing an enterprise through a

number of marketing techniques. The two main questions necessary to this
approach are: How do we find , reach and approach to each customer ? How do
we keep these customers satisfied with new possible services ?

3. Innovative technology provides important opportunities for new service

development. For a company to stay competitive, it is important to keep
services and service processes up to date .

New service development concerns all the activities involved in realizing

new service opportunities , including product or service design, business model
design and marketing of services.

Development is very abstract and can be linked with some of the

following keywords: technological improvement, cost reduction, general
welfare, improved relations and movement in a positive direction. Service
development is mostly seen as growing an enterprise through a number of
techniques, that are instrumental in ensuring two issues: How to find, reach and
approach customers and How to keep these customers satisfied with new
possible services?

When supplying a solution , it is important to focus on the total

offering the firm gives instead of only focusing on the product or service . An
offering is a package consisting of different proportions of a physical product,
service, advice, delivery and the costs.

The new services development process changing involves recognizing

chances and opportunities in a fast technological environment. For example, car
manufactures should recognize that rising gas prices are an opportunity to create
fuel efficient cars.

Innovative technology provides improvement opportunities for

new service development . For a company to stay competitive , it is important to
keep services and processes up to date.

Physical Goods as a Source of New Service Ideas: Goods and services

may be competitive substitute when they offer the same key benefits . Say for
example,

If your lawn needs mowing, you could buy a lawn mower and do it yourself or
you could hire a lawn maintenance service to take care of the chore. Such
decisions may be shaped by the customers skills, physical capabilities, time
budget etc.

Any physical product has the potential to create a need for related
possession service: Particularly if the product is a high-value and durable item.
Industrial equipment may require servicing throught out its lifespan,beginging
with shipping and installation and continuing with maintenance, cleaning,
consulting advice , problem solving, upgrading, repair and ultimate disposal.

Achieving Success In New Service Development:

According to chris storey and Christopher Easingwood, “without an

understanding of the market place, knowledge about customers and knowledge
about competitors, it is unlikely that a new product will be success.”

1.Market synergy: The new product fit well with the existing image of the firm,
provided a superior advantage to competing products in terms of meeting
customers known needs, and received strong support during and after the launch
from the firm and its branches ;further the firm had a good understanding of its
customers purchase decision behavior.

2.Organisational Factors: There is strong inter functional cooperation and

coordination; development personnel need to be fully aware of why they are
involved and of the importance of new products to the company.
3.Market Research Factors: The fact that services are intangible and
heterogeneous, it becomes imperative for a new service development system to
have four basic attributes.

They are:

1. Service design should be objective and not subjective.

2. Service design should be precise and not vague.
3. Service design should be fact-driven and not opinion-driven.
4. The steps in service design should be methodological and not
philosophical.

FINDINGS
 From the analysis I found that the hotel always uses social network sites
as strategy for business practices.
 I found that Make my Trip and Goibibo are the online social network
sites are mostly preferred by the hotel.
 From the analysis I found that the hotel is most preferring Zomato,
A to Z Kurnool, Swiggy are used by the hotel for food delivery services.
 I found that the hotel provides discounts to the regular customers.
 It is found that the value added services like surprise gifts are
implemented to attract to retain customer.
 I found that the hotel is not providing any event organizing services to the
customers.
 From the analysis I found that the hotel is providing catering services at
the of functions.
 I found that the hotel is providing free Wi-Fi facility to the customers.
 From the analysis I found that the hotel is providing additional package
services like MAP, APLAN which include meals to the customers.

LIMITATIONS
 The survey is constrained to Kurnool
 This project work is limited to the regular function of the company and
does not go deep into functions of department.
 The study is restricted to the executive and staff of the hotel as the
information was gathered by the discussion with them.
 The study is confined to Triguna Clarks Inn of branch at Kurnool.
  Time factor is the main limitation of the study.
 The method used in the project is survey method and results obtained
may not be fully accurate and believable.
 The analysis is purely based on answers, information and reactions of
respondents, which may involve loss of actual information due to
deliberate manipulation of the reaction or even barriers of
communication.

RESEARCH METHODOLOGY

“Marketing research means the systematic gathering, recording,

analyzing of data about problems relating to the marketing of goods and

services”

METHODOLOGY ADOPTED:
Research methodology is a way to systematically solve the research problem.

Here we study the various steps generally adopted by the researcher in studying

the research methods to continue a part of research methodology.

In this research, both Primary and Secondary data taken into consideration. The

project would be executed through primary data i.e. questionnaires, discussion

with various age groups of employee, information from other group of

companies, internet data’s.

Primary data: - This is those, which are collected as fresh and for the first

Time, and thus happen to be original in character. There are many ways of data

collection of primary data like questionnaire, observation method, interview

method, through schedules, pantry Reports, distributors audit, consumer panel

etc.

Secondary data: - These are those data, which are not collected afresh and are

used earlier also and thus they cannot be considered as original in character.

There are many ways of data collection of secondary data like publications of

the state and central govt., website, journals, companies reports, reports

prepared by researchers, reports of various associations connected with

business, Industries, banks etc. For this project secondary data was taken from

company’s reports and websites.

RESEARCH DESIGN:

1. Type of research: Voluntary research design

 2. Sources of data: Primary Data & Secondary Data

3. Primary Data – Questionnaire

4. Secondary Data – Websites

5. Data collection method: Survey Method, Questionnaire

6. Survey Instrument: Questionnaire (Closed and Open

Ended)

7. Method of communication: Collect the data through survey

of the employees in the organization

8. Sample size: 15 respondents

9. Sample unit: Here the researcher has randomly selected the

respondents of the Kurnool.

10.Sampling Design: systematic sampling (sample collection)

DATA ANALYSIS

NUMBER OF
PARTICULARS PERCENTAGE
RESPONDENTS
Always 15 100%
Occasionally 0 0
 Often 0 0
Rarely or seldom 0 0
TOTAL 15 100%
1. How does your hotel use social network sites as strategy for business
practices?

16
14
12
10
8
6 NUMBER OF RESPONDENTS
4 PERCENTAGE
2
0

INTERPRETATION:

From the above graph, it is analysed that always the hotel uses social
network sites as strategy for business practices.

2. Which of the online social network sites is mostly preferred by your Hotel?

NUMBER OF
PARTICULARS PERCENTAGE
RESPONDENTS
Make My Trip.com 08 53%
Tivago.com 0 0
Booking.com 0 0
 Goibibo.com 07 47%
TOTAL 15 100%

18
16
14
12
10
8
6 PERCENTAGE
4 NUMBER OF RESPONDENTS
2
0

INTERPRETATION:

From the above graph, it is analyzed that the online social network sites is
mostly preferred by hotel are Make My Trip & Goibibo.com i.e., 53%
and 46% respectively.

3. What is the most preferred app used by your hotel for food delivery service?

NUMBER OF
PARTICULARS PERCENTAGE
RESPONDENTS
Zomato 3 20%
A to Z Kurnool 3 20%
Swiggy 9 60%
Any other 0 0
 TOTAL 15 100%

16
14
12
10 PERCENTAGE
8
6 NUMBER OF
RESPONDENTS
4
2
0
Zomato A to Z Swiggy Any TOTAL
Kurnool other

4. Do you provide any discounts to your regular customers?

PARTICULARS NUMBER OF PERCENTAGE

 RESPONDENTS
YES 15 100%
NO 0 0
TOTAL 15 100%

100%
90%
80%
70%
60%
50% PERCENTAGE

40% NUMBER OF RESPONDENTS

30%
20%
10%
0%
YES NO TOTAL

5. Which of the value added service do you implement to attract &

retain customers in your Hotel?
 NUMBER OF
PARTICULARS PERCENTAGE
RESPONDENTS
Surprise Gifts 15 100%
Complimentary
0 0
breakfast
Discounts or
0 0
Beverages
Any other 0 0
TOTAL 15 100%

16
14
12
10
8
6
NUMBER OF
4
RESPONDENTS
2
0 PERCENTAGE

6. Are you providing any event organizing services to the customers?

PARTICULARS NUMBER OF PERCENTAGE

 RESPONDENTS
YES 0 0
NO 15 100%
TOTAL 15 100%

100%
90%
80%
70%
60% PERCENTAGE
50%
40% NUMBER OF
RESPONDENTS
30%
20%
10%
0%
YES NO TOTAL

7. Is your Hotel providing catering services at the time of Functions?

 NUMBER OF
PARTICULARS PERCENTAGE
RESPONDENTS
YES 15 100%
NO 0 0
TOTAL 15 100%

100%
90%
80%
70%
60% PERCENTAGE
50%
40% NUMBER OF
RESPONDENTS
30%
20%
10%
0%
YES NO TOTAL

8. Are you providing free Wifi facility to your customers?

 NUMBER OF
PARTICULARS PERCENTAGE
RESPONDENTS
YES 15 100%
NO 0 0
TOTAL 15 100%

100%
90%
80%
70%
60% PERCENTAGE
50%
40% NUMBER OF
RESPONDENTS
30%
20%
10%
0%
YES NO TOTAL

9. Are the any leisure to amenities service are available in your Hotel?

PARTICULARS NUMBER OF PERCENTAGE

 RESPONDENTS
Play Zone 15 100%
Gym 0 0
Spa 0 0
Others 0 0
TOTAL 15 100%

100%
90%
80%
70%
60% PERCENTAGE
50%
40% NUMBER OF
30% RESPONDENTS
20%
10%
0%
Play Gym Spa Others TOTAL
Zone
10. What are the additional package services your hotel is offering to
customers?

NUMBER OF
PARTICULARS PERCENTAGE
RESPONDENTS
MAP 6 40%
APLAN 9 60%
Others 0 0
TOTAL 15 100%