OYO sees 48% jump in U.S. Q4 revenue from direct platform bookings

Dive Brief:

Global travel technology company OYO’s U.S. business saw a 48% growth in revenue from bookings on its platform, including its app, website, mobile web and call centers, in the fourth quarter of 2022 as compared to the same period in 2021.
The company’s app led with a 99% surge in revenue from bookings, while growth from bookings via the company’s call centers saw a 59% increase, the company said in a release.
Executives said the jump in direct bookings could be attributed to “operational efficiencies, performance management and better incentive structures in the organization,” as well as the company’s focus on standardizing service-led components such as customer support and the booking experience across its hotels.

Dive Insight:

Because the U.S. is a highly competitive hospitality market, “driving revenue from bookings onto one's own platform and channels is always a demanding task,” said Gautam Swaroop, CEO of OYO International, in a release.

“While bookings through online travel agents such as Booking.com and Expedia.com play an important role in increasing revenues for our hotel partners, direct demand through OYO’s own platforms leads to better margins for our hotelier,” he said.

OYO saw app conversions triple and conversions from the call center double in the fourth quarter of 2022 versus the same period in 2021.

Nikhil Heda, head of business development for OYO USA, credited the improved direct conversion rates, including growth in email opens and click-throughs of app notifications, to “optimizations such as focusing on the right SEO keyword and improving property reviews on Google.” This, in turn, has resulted in “substantial savings in OTA commissions for our owners,” he said.

OYO plans to add over 100 hotels in the U.S. this year — nearly doubling the number of hotels the company added overall in 2022 — with a focus on Oregon, Washington, Texas, Oklahoma, Georgia and Florida. Texas continues to be the largest and fastest-growing market for OYO in the U.S.

The company also recently announced that its U.S. operations outpaced the budget hotel segment’s growth in RevPar with an 18% increase in 2022 versus 2019.