The Hindu : Re-branding: To whose advantage?

Online edition of India's National Newspaper
Friday, Sep 05, 2003

Business

Business

Re-branding: To whose advantage?

By K. T. Jagannathan

CHENNAI. The decision of EIH to tie up with Hilton International for co-branding hotels in India has surprised industry watchers. They feel so especially in view of the fact that the Oberoi Group has itself a well-established hospitality chain overseas. Oberoi has presence in countries like Australia, Egypt, Indonesia, Saudi Arabia and Mauritius.

The move will see eight 4-star Trident hotels across the country, including the two upcoming ones, and the Oberoi Towers in Mumbai re-branded as Trident Hilton.

Since the alliance is primarily for the mid-priced segment of the hotels, the Hilton-EIH relationship, it is stated, will have no significant fallout on the upper category hospitality ventures.

Though industry watchers concede that the partnership may have been conceived with an eye on the foreign tourists who Hilton could push through customer loyalty and such other programmes to make a beeline for Hilton Trident during their India visits. Yet, the EIH move has raised several questions. Does the tie-up with Hilton amount to an admission that the Oberoi brand has not made much of an impact on the minds of overseas people? Or, is it the result of the failure to structure a winning programme for its overseas customers to retain their trust?

Besides the Trident hotels and the Oberoi Towers in Mumbai, EIH has several Oberoi properties across the country. Why are these kept away from this arrangement? Is it because they fall into a totally different category of the hospitality segment? Post-alliance, there will be Hilton-Trident and Oberoi brands. Both will co-exist. They will apparently do so, being in different segments. The moot question, however, is: Will the international network of Hilton and Oberoi work in tandem or at cross-purpose? If they work together, which brand stands to benefit, Hilton Trident or Oberoi?

Nonetheless, the tie-up is viewed as an inevitable concomitant of competition. Probably, EIH feels that an alliance will help draw more foreign tourists to its hotels. It appears a different yet predictable approach to survival in the new age. It does not matter that the Tatas think of going for aggressive acquisition overseas to not only improve brand visibility but also entice more foreign visitors into its fold.

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