IMB 373

J RAMACHANDRAN AND SEEMA GUPTA

THE PARK HOTELS: DESIGNING EXPERIENCE

January 2010. Priya Paul, Chairperson of Apeejay Surrendra Park Hotels Ltd., the hospitality arm of the Apeejay
Surrendra Group that had interests in tea, shipping, real estate, retail, and financial services, was relieved. The
company had weathered the sharp downturn caused by the twin effects of the 26/11 Mumbai terror attacks and the
global economic meltdown better than its competitors in the highly competitive hotel industry (Exhibit 1). More
importantly, the company was on track to make a significant contribution to the Group’s vision of being India's
largest and most profitable privately owned family business.

Priya Paul, winner of a host of awards including the India Today Woman in Business: 1 Zee Astitva Business
Woman: 2 Young Entrepreneur of the Year; 3 and recognized by Forbes as one of India’s 100 most powerful business
women for 2006, had pioneered the concept of boutique hotels in the country and carved out a strong niche for the
company. Her plans to grow The Park Hotels network (Exhibit 2) to 20 properties by 2020 with presence in ten
major markets, five upcoming markets and five unique tourist destinations would radically redefine the traditional
contours of boutique hotels. Historically, boutique hotels came into being as a response to the emergence of large
hotel chains. They were typically small hotels that sought to differentiate themselves from large “full service” hotels
by virtue of their unique design and highly intimate and personalized service. Sometimes referred to as "design
hotels" or "lifestyle hotels", most were standalone properties as often, these hotels, were converted older properties
resurrected by designers, combining the charm and character of an old building with modern design. Priya Paul
asserted:

The Park is neither a cookie cutter hotel nor a chain, but a collection of hotels. Each of the hotels
in the group has it its own distinctive character, but shares a common spirit and standards of
excellence. If you notice, our logo (Exhibit 3) has a blue base that is common across all properties
– it shows that there is a certain look and feel about being in a Park hotel. But, it does not mean
that everything is identical! And that is captured in the unique thread scheme for the individual
properties reflecting the location of the hotel.

Even as she executed her 20–20 plan, Priya Paul was aware of both the strategic and organizational challenges that
lay ahead. The growing Indian economy was attracting large-scale entry from international majors with some of
them planning to enter the boutique hotel segment. Their entry, coupled with the growth plans of incumbent hotel
chains, both domestic majors such as The Taj, Oberoi, and ITC Welcomgroup and global majors such as Hyatt,
Starwood Hotels, and JW Marriott would change the competitive landscape (Exhibit 4), and make the task of
defending the niche she had so painstakingly built challenging. Further, as The Park expanded its “collection” of
hotels, the task of maintaining the individual identity of the various properties while enhancing their operational
efficiency through greater sharing of resources and coordination could prove to be particularly arduous. She said:

The whole industry is in a flux right now in terms of positioning, niche, and where you belong. It
is getting more and more crowded. Our strategy has worked well so far. Today, we are known
internationally. We have built a strong niche with our boutique hotels. To maintain it, we will need
to raise the bar and go to the next level. We need to grow, acquire good assets and find suitable
people to manage the properties. We need to make our products even more interesting and the
customer experience far more individual and innovative.

1
The award was given by the media group India Today in 2010 for her contribution in business.
2
The award was given by the media group Zee jointly with the Mumbai-based Archana Trust in honor of Indian women achievers across various
fields who have made significant contributions to the growth of society.
3
The Federation of Hotels and Restaurants Association of India conferred the award for the year 1999–2000.

J Ramachandran and Seema Gupta prepared this case for class discussion. This case is not intended to serve as an endorsement, source of primary
data, or to show effective or inefficient handling of decision or business processes.

Copyright © 2012 by the Indian Institute of Management Bangalore. No part of the publication may be reproduced or transmitted in any form or
by any means – electronic, mechanical, photocopying, recording, or otherwise (including internet) – without the permission of Indian Institute of
Management Bangalore.
The Park Hotels: Designing Experience Page 2 of 25

TAKING CHARGE
The Park Hotels came into being in 1967 when the Apeejay Surrendra Group converted its surplus real estate on the
fashionable Park Street in downtown Kolkata into a hotel. It was an instant success as it quickly emerged as the
hotspot for Kolkata’s elite. The Group launched its second hotel, a beachfront property, in the then upcoming city of
Vizag, in the southern State of Andhra Pradesh in 1968. The third property came up in downtown Delhi, almost two
decades later, after Priya Paul’s father, Surrendra Paul, renewed the group’s interest in the hotel industry. Priya Paul
recalled:

In 1986, my father decided to move the family to Delhi as The Park New Delhi that was under
construction was behind schedule. We all got involved. I would work here during every break.
Soon after I completed my undergraduate studies in Economics from Wellesley, I joined full time.
Initially I was keen to work in Wall Street, but the October 1987 crash ruled that out. I then
wanted to travel for three months in South America. When I told my father of my plans, he said
‘‘Nothing doing. Tomorrow is your first day of work!’’ And that was July 1,, 1988.

Priya Paul began as Marketing Manager of The Park New Delhi, but soon assumed the responsibility for the
property as its acting General Manager. Priya Paul said:

My father was a great teacher. He had very high standards; he wanted me to be the perfect General
Manager! Initially he came in every morning and evening for an hour to guide me. Over the course
of a year, he gradually weaned me off and came in only once a week.

With Priya Paul in charge of the Delhi hotel, Surrendra Paul turned his attention to the other two hotels in the group.
Growing competition, difficult relationship with unionized staff, and years of benign neglect – The Park Kolkata
was, for example, decrepit in comparison to newer hotels such as the Tata Group’s Taj Bengal, which had resulted
in a decline in the performance of these hotels. He set about rejuvenating the group’s hotel business. His plans
included renovation of the two properties as well as restructuring of the organization (until then, each of the
properties operated independently). Tragically, before he could execute his plans, Surrendra Paul lost his life in a
terrorist attack. The responsibility of leading the hotel division fell on the shoulders of the 23-year-old Priya Paul.
She said:

The first two years were really, really stressful. Even as I was coping with my grief, I found
myself having to suddenly manage all the three hotels. There were lots of challenges: growing
competition, militant employee unions, poor quality of service, dated systems, etc. All through
1990–1991, I was learning what was happening in each hotel, putting systems into place, finding
the right people, and putting a team together. The idea was to bring the company together and
function cohesively as one group.

A NEW VISION
Among the first people Priya Paul recruited was Vijay Dewan, the Managing Director, The Park. A graduate of the
Oberoi School of Hotel Management, Dewan had just returned after serving as the General Manager of the Oberoi
Hotel in Iraq. Vijay Dewan said:

Right from the beginning, we were clear about the direction we had to take. The idea of a boutique
hotel was there right then, but we had to sort out a lot of operational matters. We were tough with
the unions. Today, there is no employee union at The Park. We also spent a lot of time on
reorganizing the structure and practices and in building the team. We looked into all our different
activities and began outsourcing many of them. We reviewed and benchmarked every one of our
processes to find out ways in which we could create a differentiation. For example, we noticed that
a lot of hotels put in a lot of effort and expertise in guest arrival experiences but not much went
into creating a departure experience for customers. We saw an opportunity to differentiate
ourselves on providing our customers with great departure experiences. For instance, we gift an
article that resonates with the likings of the guest – chocolates for the chocoholic, traditional
Bankura horse for those interested in arts, etc. The lobby manager provides a goodbye experience
The Park Hotels: Designing Experience Page 3 of 25

(similar to that experienced on staying at a friend’s house) by waving to the guest till the car
leaves the premises. Our effort was and continues to be to differentiate and win on our service.

Even as the team focused on enhancing the quality of service, Priya Paul realized that The Park would need to
differentiate its product. The renovation of The Park Kolkata that her father had initiated provided her with an
opportunity to test her ideas. She said:

I used the new Chinese restaurant, Zen that was coming up at The Park Kolkata to demonstrate a
new design or a vision for the team. I found the design that had been developed – we were then
working with a senior Bombay designer who my father had worked with before – to be very
traditional and staid with red and green dragons and all that. I said let’s do something modern and
contemporary, something different from everyone else. We came up with a radical look in black
and white and went with that. We didn’t go out there in Kolkata and ask people what they wanted
but created products that I felt I would enjoy and hopefully others too.

The restaurant opened at the end of 1992 and met with rave reviews. Its success prompted further experimentation.
The bar at The Park Kolkata was next. When it opened on August 19, 1994, it was different from all other bars in
the city. Branded Someplace Else, the bar, hosted live bands. It too proved to be a big hit. Priya Paul explained:

Our timing was great. Soon after the liberalization of the economy in 1991, there were suddenly a
lot of Indians who had made a lot of cash and wanted to spend it and there was nowhere to do that.
There were hardly any clubs or bars that were fun places. Most hotels were these bastions of
formality with waiters with gloved hands, etc. So when we opened our clubs and restaurants in
Kolkata, apart from the fact that they were very refreshing looking and the serving style was much
more informal – our waiters wore colored uniforms and not those white and black things that were
typical of those days – they became an entertainment venue. Someplace Else became a hotspot; a
place where you could go and spend some time and relax and be seen.

The success of both Zen and Someplace Else, prompted Priya Paul to formally articulate a new vision for The Park:
Leadership through Differentiation (Exhibit 5). Priya Paul said:

Our challenge was to survive and grow in a market place that had big chains like The Taj Group,
The Oberoi Group, and the international chains. We could do that only by being different, by
being more creative than them and by creating a new paradigm in terms of product and service.
But, we needed to get a buy in from our people before we could sell the concept of differentiation
to our customers. I made presentations to senior management on how The Park is a design hotel
with superior service and what it meant to be a boutique hotel company.

PIONEERING A NEW PARADIGM

The acquisition of two properties in quick succession in Bangalore and Chennai provided Priya Paul with an
opportunity to create a new paradigm on the lines of what Ian Schrager 4 had done in New York. Priya Paul said:

While I was in college, I was watching what Ian Schrager had done in New York; I had even
stayed in two of his boutique hotels and had realized that hotels can be quite different. So when I
wanted to figure out what our identity was, how we make ourselves seen and heard against the
crowd, I felt that we could create a niche for ourselves by positioning ourselves as a boutique
hotel. The buying of the Bangalore property was a defining moment. It was small enough to be
completely transformed and launched as a proper boutique design hotel.

4
Ian Schrager, co-founder of the famous nightclubs Studio 54 and Palladium in New York City, pioneered the concept of boutique hotels when
he launched Morgans Hotel, a refurbished property, in 1984 in New York City’s Madison Avenue. Several other hotels – the Royalton (1988), the
Paramount (1990), and the Hudson (2000) in New York, the Delano (1995) in Miami, the Mondrian (1997) in Los Angeles, and the St. Martins
Lane (1999), and the Sanderson (2000) in London followed. In 2005, Schrager left the Morgans Hotel Group to create the Gramercy Park Hotel
in New York, in collaboration with artist Julian Schnabel, and two residential projects: 50 Gramercy North, in collaboration with British architect
John Pawson and 40 Bond Street in partnership with Swiss architects with Herzog & de Meuron. In 2007, Schrager signed a deal with Marriott
International to design about 100 boutique hotels, to be owned by individual investors and operated by Marriott, in major cities across the
Americas, Europe, and Asia. The first two properties branded ‘‘Edition’’ were to be operational by the end of 2010. (Source: Author research)
The Park Hotels: Designing Experience Page 4 of 25

While the centrally located Bangalore property was small enough, its transformation was not easy. Deepak Bali,
Vice President, Engineering & Projects explained:

What we had acquired was a three star property, which meant it was built differently – the rooms,
the restaurants, the banquets, and the kitchens were all built small. To convert that into a five star
property was a challenge.

The company hired the UK firm Conran & Partners to design the hotel. Priya Paul said:

Until then, we had worked with local design firms and it was clear to me that there was a limit to
how far Indian firms could take the design. I felt an international company would be able to
interpret India in a more contemporary manner than anybody else.

The new hotel, The Park Bangalore, opened in the year 2000 to rave reviews. The hotel’s design was a fusion of
vibrant colors and landscapes; the first floor was designed to give a feel of cool expanse of sea, the second floor
suggested a mountain landscape, the third the look of a jungle and, the fourth floor sported the feel of an oasis in a
desert. The unique imagery won it a place among the Tatler magazine’s 101 best hotels in the world. The Park
Bangalore’s lounge bar, the I-Bar, with its low furniture, bean bags, and neon colors was described by a leading
Bangalore daily as one of the hippest hangout places in the city. Its Italian restaurant, Italia, quickly gained
popularity among the discerning foodies of Bangalore and won a host of awards including the Best Italian
Restaurant award from The Times Food Guide, the Best International Restaurant, and the Restaurant of the Year
awards from the Taste & Travel Food Lovers Food Guide.

If The Park Bangalore showcased contemporary India, The Park Chennai, built on the premises of the historic
Gemini film studios 5 and designed by the American firm, Hirsch Bedner Associates captured the fantasy world of
films. While the lobby with its stage-like setting evoked the look of a theatre (Exhibit 6), old movies projected
during the evenings on a floating screen located in the atrium and the carpets in the corridors that looked similar to
film reels reminded one of the magic of movies. Reviewing The Park Chennai, soon after its launch, the industry
magazine Hospitality World commented:

It is difficult not to get away from the metaphor of film nostalgia while sampling the many
different aspects of The Park. On the 8th floor for instance, floating up over the rest of the still
modest Chennai landscape is a setting worthy of Lawrence of Arabia. There are blue and white
striped tents and sunshades that hover over white cushioned deck chairs that border a California
style swimming pool. An op-art-like effect of black and white stripes dominates the floor of the
adjoining coffee shop called Aqua, with blond wood furniture and a startling close up of a young
woman clad in a blue and white thing stretches along one wall to add a surreal effect.

The widespread acclaim the company received for the Bangalore and Chennai properties prompted it to build new
boutique hotels in Navi Mumbai and Hyderabad. In designing the former, it sought to bring together “East and West
and fusing technology with local crafts” and in the latter case, it drew inspiration from Hyderabad’s history of
producing precious stones; the hotel’s façade, for example, references the fabled jewelry collection of the Nizam of
Hyderabad.

Even as she pioneered the concept of boutique hotels in the country, Priya Paul was clear that her notion of boutique
hotels differed from the Western models. She said:

I don’t believe in design for design sake. Both design and function need to work together.
Customers want both good design and good service, especially Indian customers. They don’t like
the western concept of plug and play. They would like us to guide them to get plugged. And why
not? I believe we are in the business of indulging people. That’s why I never put weighing scales
in any of my rooms. I believe in people having fun, enjoying the night life, hanging out in the bar,
eating in our restaurants. The last thing I think customers should do is discover that they are 5
kilos overweight the next morning on the weighing scale!

5
Gemini studio was one of the earliest and most influential film producing studios of India. The Gemini emblem of two small boys with bugles
adorned many classic movies made between 1940s and 1960s.
The Park Hotels: Designing Experience Page 5 of 25

INDULGING CUSTOMERS
In addition to building new properties, the company, renovated its older properties in Delhi, Vizag, and Kolkata. The
Park Delhi got a complete facelift. Its new design was inspired by the five elements of nature (water, fire, air, earth,
and space) from the Hindu science of Vaastu Shastra. The Park Kolkata focused on further enhancing its reputation
as a fun and happening place. A street café called ‘‘The Street’’, created a vibrant atmosphere right at the entrance.
A new cocktail bar Roxy, its retro look a tribute to the swinging ‘60s, offered customers a wide variety of cocktails
and an enviable choice of cigars. Spread over two split levels, the night club Tantra with its pulsating dance floor
and a lounge area called the Santra Room, provided its typically young customers a choice of two bars. While Aqua,
a fashionable new bar, indulged the young and trendy with a “Miami”-like poolside experience – the open deck,
used for sunbathing by the day, became a stage for night time revelry, Someplace Else continued to offer customers
its signature live band experience. Vijay Dewan said:

The traditional notion of hotels was one where people came to sleep when they were travelling on
business. We asked ourselves “Can we be more? Can people socialize in hotels, can people come
to party in hotels, and can people come to entertain or get entertained in hotels?” That is when the
second part of our mission came in, we would take customer experience to be the purpose of our
every action we take and every job we do. Our 1995 vision and mission statement focused on
customer satisfaction. In the early part of 2000, we revised it to focus on creation of experiences.
Thereafter began our huge emphasis on entertainment, in creating a spa experience, in creating a
luxury experience; you may come for business, but you can also relax and get entertained. For us,
entertainment is a key differentiator.

The company also offered its customers a wide variety of culinary experiences through its exciting range of award-
winning restaurants. Priya Paul said:

I am a foodie and I enjoy discovering new cuisines. So, I am willing to be a lot more adventurous.
Sometimes they don’t work like the Spanish restaurant that we opened in The Park Delhi. It was
too avant garde and had to be closed down despite excellent reviews for its authenticity. When we
did Fire, our Pan Indian restaurant in Delhi, I asked all the chefs, some 10–12 of them, who were
from different parts of the country to make the best dish from their respective homes, whether it
was their own recipe or their grandmother’s. Every one of them came back with great pride with
what was the best from their home. We had a wonderful time – tasting them all and choosing what
was to be included in the menu. Our challenge was to make the traditional Indian dishes in a way
that they can be included in a restaurant menu. Take Haleem. Most restaurants won’t serve such a
labor-intensive item. But we do, at Fire. It has been such a run-away success that we can’t take it
off the menu. Our customers would protest! Our effort is to make items that are usually not on
restaurant menus, and offer them along with staple dishes on any menu like Dal Makhani.

Aditya Gemini, Executive Sous Chef, The Park Delhi added:

Food is not only to fill the stomach; it is also to evoke emotions. There should be at least one
highlight of the meal that the guest will never forget. Cooking is not a task, but an art form – let
the passion reflect on the plate. It is not the chef but the food one makes that is the star. Every dish
irrespective of its position on the menu or its price tag needs to get equal love from the chef.

According to Vijay Dewan, what made the customers experience memorable, in addition to the company’s
distinctive products, was the quality of its service. He said:

Our style is different. It is what Priya calls “white-gloved service without the white gloves”. The
difference can be in small things like say how we present our people to you – all our staff are in
uniforms designed by designers like Rohit Bal or Suneet Verma or Raghavendra Rathore or Kiran
Uttam Ghosh – or in how they interact with you. Our people know it. We actively encourage them
to express their individuality in their interactions with customers because we believe it is critical
for our success.
The Park Hotels: Designing Experience Page 6 of 25

EMPOWERING PEOPLE
In 2007, The Park received the international ‘‘Gallup Great Workplace Award’’ for extraordinary employee
engagement. The Park was the only winner from India, other winners included reputed brands such as Starbucks,
Wells Fargo, and Marriott; the award was given to firms in which The Gallup Organization, USA, a premier
research-based management consulting firm, finds that the employees are 100% psychologically committed to their
role; are thrilled by the challenges of work; are in the roles that uses their talent; know the scope of their job; and are
always looking for newer and different ways of achieving the outcomes of their role. Priya Paul explained:

We give our people responsibility far beyond their age. We encourage them to take decisions and
back them if they falter.

Namrata Ray, Manager – Events & Entertainment, The Park Kolkata, concurred. The 28-year old, who almost
singlehandedly conceptualized the events to be organized at The Park Kolkata, made the calls on which popular or
emerging talent was to be invited to perform at Someplace Else, what event to host at the Tantra, etc. said:

The events cannot be planned too much in advance. I make last minute decisions on event genres
and artists to tap into the popular culture at that time or to counter attack competition. I get total
freedom.

Further, The Park trained its people to look at things differently. It expected each of them to think of their property
first and The Park Hotels next. Vijay Dewan explained:

The General Manager of The Park Chennai thinks of The Park Chennai first and then The Park
Hotels. That is because he has to create a differentiation in his product and service to be
competitive in his market. If he opts to practice something happening in another unit, then it is
because he believes he can create a great success out of it and not because of a standard code. Our
backend systems and processes are standardized, whether it is HR, Finance, or Purchase. For
instance, if I have an incentive scheme in Calcutta, I will have the same incentive scheme in Delhi
also and so on. But at the front end, we avoid too much standardization as our products, services,
and experiences have to be differentiated.

The Park was the first hotel in the Indian hospitality sector to embrace SAP for managing its human resources (HR).
In addition to streamlining and standardizing administrative systems, SAP enabled the company to improve
efficiency through better planning and superior MIS (Management Information System). Further, it engineered its
technology and other associated systems to enable its people to excel, for example, a single point of contact system
in which guests at The Park had to dial a single number for all their needs ranging from in-room dining to
housekeeping, laundry, etc. This facilitated the team to provide a personal touch to the services they rendered to the
customers. Guests often requested for a specific person to be assigned to their rooms who knew all their preferences.
Sujata Guin, Area Director-Human Resources said:

We encourage a ‘‘serve with a smile’’ attitude even when situations are challenging! Our focus in
HR is on people engagement and alignment with the organization’s business strategy. Towards
this, we invest heavily in our people. Learning and development is a huge focus for us. We send
our people to various national and international development programs at Cornell University,
London Business School, Harvard University, etc. Our chefs are sponsored to attend meets and
seminars in Europe. The Apeejay Institute of Hospitality, our hospitality training institute, helps
build future leaders through the Management Training Program. We also encourage sharing of
best practices by organizing periodic get-togethers of work groups and competitions among them.
Several awards like ‘‘U make the Difference’’ and ‘‘Monthly Best and Merit Employee awards’’
recognize and appreciate outstanding performance.
The Park Hotels: Designing Experience Page 7 of 25

MARKETING THE EXPERIENCE

The differentiated product and service experience enabled The Park Hotels to compete against its much larger and
perhaps better-known rivals. In markets such as Navi Mumbai, Kolkata, and Vizag, it had leadership positions
(Exhibit 7).

The Park reached out to corporations and airlines, the two large segments through direct sales force. Pramod
Bhandari, Director Sales, explained:

We sign contracts with large corporate houses by participating in RFPs (request for proposals).
We win most of the RFPs we participate in. But, we do not get to participate in many RFPs as we
do not have a hotel in Mumbai and these organizations are looking at hotel chains with major
metro presence and at times a global presence. Among the airlines, we have a strong presence in
domestic airlines segment, but with international airlines, we do take a setback at times as they
look for a global contract with a global chain like Hyatt. But even if the crew stays at the Hyatt,
they party at the Park!

Food and beverage accounted for nearly 38% of The Park’s revenues. Rupa Thomas, Director Public Relations &
Corporate Communications said:

Italia in Bangalore; Leather Bar in Chennai; Fire in Delhi; Tantra, Roxy, and Someplace Else in
Kolkata have a strong brand appeal in local markets. We attract customers to these spaces by
hosting lot of events and promotions around art, fashion, music, and book launches. This keeps the
buzz going and has a rub-off on our room business also.

Anirban Simlai, Executive Manager, The Park Kolkata added:

We have built communities around these spaces on social networking sites like Facebook where
members join on their own volition. We post the upcoming event on the group page and send
invites to the group members. Members can also express their opinion on what has been posted for
the group. Facebook thus provides a forum for immediate, honest, and interactive communication.

The Park’s alliance with ‘‘Design Hotels’’, a consortium which marketed select 162 hotels across 42 countries
through a global distribution system enabled it a fair share of foreign guests (Exhibit 8). A state-of-the-art revenue
management system 6 (RMS) provided the hotel front office staff with access to rich data that included the capacity
(the inventory of service resources), cost (the price of the service), customer demand forecast (at any given
time/date), competitive tariffs, hurdle rate for the day, etc. Sunitha Garcha, Associate Director, Front Office &
Revenue Management, said:

Based on the data, the lobby managers could charge differential rates, offer discounts up to 10% to
privileged customers.

To improve its share of online sales (Exhibit 9), the company set up a web marketing department. The Internet was
increasingly becoming an important source of bookings for the hotel industry (Exhibit 10). Bookings through brand
websites 7 (Exhibit 11) comprised a lion’s share of the bookings through Internet. To encourage embassies to hold
their parties there, as well as encourage industry bodies such as CII, FI CCI, etc. to hold their conferences at The
Park, the company had dedicated ‘‘Relationship Managers’’ to focus on the special needs and preferences of these

6
RMS is an algorithm which helped in setting reservation policy in a manner that maximizes revenues. It used past history and other statistical
data to make continuously updated recommendations regarding the hotel booking patterns and the minimum price to be offered to the guest. It
maximized revenues by driving business to higher paying or longer staying guests and by estimating the overbooking that the hotel could do
based on the likely cancellations or no shows and the walk cost (the cost of turning the customer away) which depended on the customer’s future
lifetime value.

7
Website where distribution is operated and managed by the brand (e.g. http://marriott.com/)
The Park Hotels: Designing Experience Page 8 of 25

institutions. For example, they would organize national day celebrations at the hotel and invite the respective
country’s ambassador to inaugurate the event and thereby deepen the bond with the embassies. The Park used
conventional advertising in lifestyle, business, and in-flight magazines (Exhibit 12) to support its active public
relations effort. The Park’s share of voice in the media, aided in part by its active event management strategy
(Exhibit 13), was among the highest in the industry (Exhibit 14). Vijay Dewan said:

The typical target consumer of The Park is someone who is young at heart, contemporary,
creative, and independent; typically people from media, entertainment, and fashion industry who
are trend setters and act as key influencers. A lot happens at The Park with film stars coming here,
music bands coming here, fashion shows, art exhibitions happening here, a lot gets written about
The Park.

The Park’s loyalty program ‘‘Preferred at The Park’’ was a recipient of the prestigious national ‘‘Golden Peacock
Innovative Product Award’’. A smart card with an embedded chip recorded all the information – the guest history,
her/his profile including the likes, dislikes, requests, and preferences such as newspapers, pillows, etc. After every
visit, the feedback from customers was collated and reviewed by senior management. To bring alive its tag line, Stay
inspired, The Park’s house magazine, Living, an edgy and contemporary quarterly, invited guests to write a column
on what inspired them at The Park. Priya Paul said:

Our effort is to connect with our customers at a deeper emotional level. We want to manage
customers across their lifecycle. The guest may start with dancing in Tantra, get married in the
banquet hall, experience Aqua as he matures, book a room as he grows professionally and have a
drink at Roxy after retirement!

THE NEXT BIG CHALLENGE

To fund its expansion, Apeejay Surrendra Park Hotels Ltd. raised US $55 million (Rs. 2.2 billion) from the Swiss
financial major, ‘‘Credit Suisse’’ through a private equity deal that valued The Park at Rs. 15 billion. The new
property in Hyderabad and the upcoming ones in Jaipur, Pune, and Kolkata (a second one) would double the room
capacity from 838 to 1,625. The planned properties in Goa and south Mumbai for which the search for land was in
progress would take this number further up to 2,100, thus widening the company’s footprint. Rohit Arora, Corporate
Director Sales said:

The addition of Jaipur in particular will be of immediate benefit because right now we are virtually
locked out of the golden tourist triangle of Delhi–Jaipur–Agra. To be a serious player in this high
tourist circuit, we need to have presence in at least two locations.

The company was not planning to expand its footprint globally, unless it was a unique tourist destination. Vijay
Dewan said:

Our strategy is to remain the leading boutique hotel collection in India by growing our presence in
the 10 major markets and five upcoming markets in the country. We are open to looking at
properties abroad only as a part of our five unique tourist destinations strategy in the 20–20 vision
plan. But, we are unlikely to consider places like London – the space is too congested and it’s not
easy to compete. We will only look at places where we believe we can win. And right now our
focus is India. The biggest disadvantage for us, at the moment, if I compare with The Taj or
Oberoi or any major international chain is our size and reach. Nor are we affiliated with any
international brand. To sustain our growth and position, we will need to continue to differentiate
ourselves. We will need to raise the bar further. Can we once again change the way people live in
hotels? Can we evolve further in the product–service–experience chain? It is somewhat easy to
create products and services. It is far more difficult to create an experience. We have done that and
succeeded at it. Can we now design our customer experiences to make them more blissful,
scintillating, and memorable? That is our next big challenge and the way forward.

This case study is the winner of the EFMD Case Writing Competition 2011. The authors are grateful to the management team at Apeejay
Surrendra Park Hotels for their help and support in writing the case.
The Park Hotels: Designing Experience Page 9 of 25

Exhibit 1
Financial performance

2005–06 2006–07 2007–08 2008–09 2009–10*

Revenue (Million Rs.)
The Park Hotels 1742 2201 3092 2732 2086
Taj Hotels Resorts & Palaces 11276 16187 18070 17065 12014
Oberoi Hotels & Resorts 8032 9952 11499 10572 7531
Hotel Leela Ventures Ltd. 3464 4524 5891 5822 3546
Hyatt 3299 4148 5339 4638 3070
ITC Welcomgroup 7834 9857 10121 9355 5945
EBIDTA (% of Revenues)
The Park Hotels 35.71 42.57 40.01 35.64 31.0
Taj Hotels Resorts & Palaces 31.70 39.40 41.12 33.72 23.08
Oberoi Hotels & Resorts 45.30 39.90 40.11 38.80 27.01
Hotel Leela Ventures Ltd. 50.30 51.70 56.06 49.05 30.01
Hyatt 38.50 44.50 43.48 38.09 40.0
ITC Welcomgroup 32.95 35.59 40.59 33.80 23.27
PAT (% of Revenues)
The Park Hotels 16.10 20.67 20.94 15.59 12.0
Taj Hotels Resorts & Palaces 16.30 19.90 20.88 13.71 9.0
Oberoi Hotels & Resorts 23.65 20.29 18.89 16.16 5.0
Hotel Leela Ventures Ltd. 19.30 33.60 26 25.05 10.1
Hyatt 17.20 24.60 25 20.26 12.0
Market Cap
(365-day average)
Taj Hotels Resorts & Palaces 46070 78870 84440 50520 55760
Oberoi Hotels & Resorts 25380 37280 51300 46950 48750
Hotel Leela Ventures Ltd. 18360 23170 19620 11020 14090

Note: 1$ = Rs. 45, in 2010

The Park Hotels: Designing Experience Page 10 of 25

Exhibit 1 (continued)

Other Metrics

Cost (% of Revenue) The Park Taj Hotels Oberoi Hotels Hotel Leela Hyatt

Material Cost: 2008–09 11.27 6.71 7.83 6.00 13.7

2009–10* 11.3 7.8 12.9 7.3 19.2

Payroll: 2008–09 15.06 22.66 22.54 16.40 22.2

2009–10* 16.8 25.3 28.10 23.0 20.4
HLP: 2008–09 6.42 5.7 6.7 7.24 6.7
2009–10* 7.7 7.3 6.8 10.7 7.2
Repair & Maintenance:
2008–09 3.93 3.32 2.24 1.28 1.7
2009–10* 3.93 4.42 1.00 2.28 1.0
Other Overheads:
2008–09 27.68 27.89 21.89 20.03 27.3
2009–10* 21.37 28.28 22.50 23.22 24.6

Source: Company/Author research * Data is for 9 months – April 2009 to December 2009
The Park Hotels: Designing Experience Page 11 of 25

Exhibit 2
The Park Hotels Network

Location/ Year
Established/No. of Restaurants Entertainment
Rooms
Kolkata Zen: Pan-Asian Japanese, Thai, Someplace Else: Pub with live bands
(1967) Chinese oriental cuisine Tantra: Award-winning high energy nightclub
Rooms & Suites The Bridge: 24-hour restaurant spread over two floors
149 Saffron: Contemporary Indian Roxy: The only cocktail bar in town
restaurant Aqua: Award-winning poolside entertainment
space
Aura, The Spa: A complete health & fitness
center
Visakhapatnam Vista: 24-hour restaurant Aqua Zone: Spa with a gym
(1968) The Bamboo Bay: An open-air cum The Someplace Else Bar: Library bar
Rooms & Suites air-conditioned beach-facing restaurant
66

New Delhi Fire: Award-winning contemporary Aqua: Award-winning poolside entertainment

(1987) Indian restaurant space
Rooms & Suites Mist: 24-hour restaurant Agni: Award-winning bar
220 The Spa Terrace: Offers yoga sessions
Aura: Luxury spa
Bangalore Monsoon: 24-hour restaurant i-Bar: Lounge bar with poolside access
(2000) Italia: Award-winning Italian Aqua: Award-winning poolside entertainment
Rooms & Suites restaurant space
109 Aqua Zone: Spa with gym and underwater
private treatment rooms.
Chennai Six-O-One: 24-hour restaurant The Leather Bar: High-energy bar with DJ
(2002) Lotus: Modern Thai restaurant. Pasha: Nightclub with outdoor terrace for
Rooms & Suites Aqua: Rooftop poolside restaurant private hire
214 Aura: Luxury spa

Navi Mumbai Zest: 24-hour restaurant Dusk: Bar

(2007) Aqua: Signature poolside space Aqua Zone: Spa with gym
Rooms & Suites Bamboo: Authentic specialty Chinese
80 restaurant

Source: Company
The Park Hotels: Designing Experience Page 12 of 25

Exhibit 3
The Park Hotels – Corporate and unit logos

Blue base to Depicts the Manifestation Expression of Reference to Reflects the Manifestation
give cohesion colors of of sand, aqua, sandstone, software, silk, flashiness of of brick,
throughout dusk, sunset, and clay sun, and and leaf Bollywood, bamboo, and
representing
The Park and sunrise representing grass blue sea, and palm,
India’s Silicon
Hotels and representing the beach representing Valley, home proximity to representing the
silver to give a the old city location – red the capital of silk and the country’s chaotic city,
modern and architecture soil, golden city with red gardens within business cement
elegant look with a sand, and the stone the city capital buildings,
modern and blue sea buildings and bamboo
colonial feel many green scaffolding, and
areas green park areas

Source: Company
The Park Hotels: Designing Experience Page 13 of 25

Exhibit 4
The competitive landscape in 2010 (A, B, C)

A. Distribution of existing and proposed branded hotels by major cities

Existing Supply Proposed Additional Active Deployment of Share of Luxury in

(2008/09) Supply (Total) Proposed Supply (%) Additional Supply (%)
Agra 1419 400 75 25
Ahmedabad 800 3058 71 8.2
Bangalore 3889 10784 58 23.8
Chandigarh 351 1459 55 11.3
Chennai 3307 4945 67 36.7
Delhi (NCR) 8625 16560 53 18.2
Goa 2795 2178 31 14.0
Hyderabad 2761 5884 73 42.1
Jaipur 1683 3357 53 16.1
Kolkata 1373 4025 62 24.2
Mumbai 7948 13386 73 29.9
Pune 1518 8054 52 22.3
Other cities 12006 20025 60 2.5
Total 48475 94115 60 20.2

Source: HVS Hospitality Services Report 2009

 The Park Hotels: Designing Experience Page 14 of 25

B. Indian majors and their plans

Company Background Brand Portfolio Growth Plans

Established in 1903, The Indian Hotels Company Taj – Luxury, Vivanta, 12 new hotels in
Limited of the Tata Group has been operating 15 Gateway, Taj Exotica, next 3 years
hotels abroad and 60 hotels in 45 locations across Taj Safari, Ginger
India in a wide range of locations – business
districts, beaches, hill stations, historical and pilgrim
centers, etc. These include the Taj President,
Mumbai (292 rooms); Taj Palace, New Delhi (422
rooms), Taj Westend, Bangalore (117 rooms), Taj
Connemera, Chennai (150 rooms); Gateway,
Vishakapatnam (89 rooms), etc.

Established in 1975, the hotels division of the FMCG ITC Hotel; ITC Plans to set up 7
Major ITC Limited has been operating 85 hotels in Welcome Group new hotels – Land
India across a wide range of locations – business Sheraton Hotel; in Hyderabad,
districts, beaches, hill stations, historical and pilgrim Welcome Hotels; Ahmedabad,
centers, etc. Additions in the last 10 years include the Fortune Hotels; Amritsar,
ITC Maratha, Mumbai (386 rooms), ITC Grand Welcome Heritage Bhubaneshwar,
Central, Mumbai (242 rooms), ITC Kakatiya, Coimbatore, and
Hyderabad (188 rooms); ITC Royal Gardenia, Gurgaon
Bangalore (292 rooms); and ITC Sonar, Kolkata already in
(238 rooms). company’s
possession

Founded by the Oberoi family in 1934, the East India The Oberoi & The 12 new hotels
Hotels Company has been operating 30 hotels across Trident being planned
a wide range of national and international locations –
business districts, beaches, hill stations, historical
stations, etc. and 5 luxury cruises. These include the
Oberoi Mumbai (287 rooms), Oberoi New Delhi
(282 rooms), Trident Gurgaon (136 rooms), Trident
Bhubhaneswar (62 rooms), etc.

Founded in 1957 by Capt Krishnan Nair, the The Leela Kempinski 6 new hotels
company has seven hotels in major cities in India – being planned
Bangalore (350 rooms), Goa (185 rooms), Kerala
(182 rooms), Udaipur (80 rooms), Mumbai (391
rooms), Delhi (260 rooms), and Gurgaon (332
rooms). The company also has an alliance with the
Kempinski, Europe’s oldest luxury hotel group.

Source: Author Research

 The Park Hotels: Designing Experience Page 15 of 25

C. Global majors and their plans

• Investments planned
• US$200 million along with Inter Globe.
• US$300 million with EMAAR.
• US$106 million with Naman Developers
Brands: Sofitel, Novotel, Ibis • 25 Ibis ( budget) hotels over the next 10 years
.

• Alliance with Unicorn Holdings; Sarovar Hotels & Resorts;

Chanakya Hotels
Brands: Radisson Hotels & Resorts; Park Plaza; • 26% stake in venture with Unitech Group
Regent Park Inn; Country Inn & Suites • 17 hotels under development

• 26% stake in joint venture with DLF Group to invest US$143

million
• 80 properties under development

Brands: Hilton; Hilton Garden; Homewood Suites,

Scandic

• Currently 5 hotels in India

• Plan to open 20 new hotels
Hyatt Regency; Grand Hyatt; Park Hyatt

• Alliance with Bharat Hotels; Intercontinental Grand Hotels

• Plan to open 20 new hotels over next 5 years.

Brands: Intercontinental, Crowne Plaza, Holiday Inn

• Currently 11 hotels in India

• Plan to open 7 new hotels
Brands: JW Marriott, Marriot, Courtyard

• Exploring equity partnership with real estate companies

• Plan to open 50 hotels

Brands: St. Regis; Westin Hotels; W Hotels;

Sheraton; Le Meridien; Luxury Collection, Four
Points, Aloft.

• Starwood's W line with 33 hotels worldwide is

the biggest player in the boutique segment. 18
more hotels are to be added in the next 4 years.

Source: Author Research

The Park Hotels: Designing Experience Page 16 of 25

Exhibit 5
The Park Hotels – Vision and mission

Vision
Leadership through differentiation
Mission
We will operate a collection of luxury boutique hotels and restaurants,
establishing global standards of product quality and service excellence.

We will enhance customer experience and make it

the purpose of every action we take and every job we do.

We believe our strength is our people and we will encourage their development.
We respect them as individuals and believe that teamwork, commitment,
integrity are values that will lead us to success

We will ensure the profitability and growth of the company for the
long-term benefit of our shareholders, our customers and our employees.

We believe that it is essential to be a good corporate citizen

and serve the community that sustains us.

Source: Company

Exhibit 6
Lobby @ The Park, Chennai

Source: Hospitality World, April–June 2004

The Park Hotels: Designing Experience Page 17 of 25

Exhibit 7
Market-wise and segment-wise performance (A, B, C)

A. Performance in different markets

The Park
The Park The Park The Park The Park The Park
Navi
New Delhi Chennai Kolkata Bangalore Vizag
Mumbai
Market Share
2008–09 5.01 12.62 15.00 4.92 30.39 9.44
2009–10* 6.49 11.41 22.3 4.14 32.33 33.10
ARR
2008–09 8564 6407 6465 9993 5729 8157
2009–10* 6541 5560 5926 6712 5200 5753
Market Leader
ARR
2008–09 14735 10035 7680 14806 Leader 10051
2009–10* 12493 7664 7581 11133 Leader Leader
OCC%
2008–09 77 64 82 52 83 42
2009–10* 80 54 87 41 76 39
Market Leader
OCC%
2008–09 84 69 Leader 73 Leader 63
2009–10* Leader 63 Leader 66 Leader 44
Rev Par
2008–09 6567 4132 5311 5216 4733 3525
2009–10* 5255 2977 5741 2758 3932 2228
Market Leader
Rev Par
2008–09 12231 5923 Leader 10736 Leader 6147
2009–10* 9387 3855 Leader 6930 Leader Leader

Source: Company * Data is for 9 months – April–December 2009.

Note: ARR is Average Room Rate; OCC is Occupancy rate; RevPAR is Revenue per Available Room (ARR × Occupancy rate).
The Park Hotels: Designing Experience Page 18 of 25

B. Share of revenues from different customer segments

(In Million Rs.)

Segment 2006–07 2007–08 2008–09 2009–10*
Corporate** 801.1 982.1 723.9 421.48
Airlines*** 61.9 147.7 188.1 124.75
Conference 99.7 160.7 74.5 -
Leisure 283.6 324.4 206.7 146.39
Others 85.7 148.1 171.1 202.18
Total 1332 1763 1364 895.09

Source: Company * Data is for 9 months – April–December 2009

**The major corporate accounts are IBM, Reliance Group, HSBC, and Tata Steel.
***The major airlines accounts are Jet Airways, Air India, Kingfisher, and Indigo.

C. Share of revenues from rooms and food and beverage (F & B)

(In Million Rs.)

2006–07 2007–08 2008–09 2009–10*
Room Revenue 1332 1763 1364 1064
F & B Revenue 764 1113 1092 793

Source: Company * Data is for 9 months – April–December 2009

 The Park Hotels: Designing Experience Page 19 of 25

Exhibit 8
Guest Analysis

The Park Industry

Revenue Share 2008–09 2009–10 2008–09 2009–10**

Domestic (%) 56 57 57 54
Foreign (%) 44 43 43 46

Average No. of Days of Stay

Domestic 2.15 1.8 2.3 2.3
Foreign 2.75 2.7 4.3 4.3

Source of Reservation (%)

Electronic (GDS* + Internet + Hotel
14.3 19.1 25.4 25.4
Website)
Direct Enquiry/Hotel Representative 66.48 63.34 41.7 41.7
Chain Central Reservation System 0 0 16.1 16.1
Travel Agents & Tour Operators 13.76 12.06 11.2 11.2
Others 5.46 5.5 5.6 5.6

Source: Company *Global Distribution System **Data is for April–December 2009

 The Park Hotels: Designing Experience Page 20 of 25

Exhibit 9
The Park Hotels – Online reservation
(http://www.theparkhotels.com/)

Exhibit 10
Share of Internet in hotel bookings

Channel 2006 2007 2008 2009

Internet (%) 37.60 42.00 47.60 54.20
Share of brand websites among Internet
sources (%) 76.10 75.90 75.20 70.90

Source: www.travelclick.net. TRAVELCLICK provide industry booking trends based on 30 major hotel brands and chains worldwide.
The Park Hotels: Designing Experience Page 21 of 25

Exhibit 11
Websites of select hotel brands

(http://www.itcwelcomgroup.in/)
The Park Hotels: Designing Experience Page 22 of 25

Exhibit 11 (continued)

(http://www.marriott.com/)
The Park Hotels: Designing Experience Page 23 of 25

Exhibit 11 (continued)

(http://gramercyparkhotel-px.trvlclick.com/reservations.html)
The Park Hotels: Designing Experience Page 24 of 25

Exhibit 12
The Park Hotels – Advertisement

Source: Company
The Park Hotels: Designing Experience Page 25 of 25

Exhibit 13
An event communication

Source: Company

Exhibit 14
Media: Share of voice
(In percent)

2007–08 2008–09* 2009–10

Oberoi Hotels & Resorts 22 17 19
The Park Hotels 21 24 22
The Taj Hotels Resorts & Palaces 20 23 28
Hyatt 14 13 12
Hotel Leela Ventures Ltd. 9 10 8
Others 14 14 12

Source: Company *The 2008–2009 data does not include the last quarter of 2008.