WudStay is an aggregator and standardiser of accommodations, however, the work often boils down to teaching hospitality to the hotels. “It is important to realise that the hotels and hostels we aggregate are small businesses and cannot afford to hire graduates from good institutions. They do not understand hospitality, especially the nuances of it,” says Mathur, founder of WudStay.
The startup has a designated team of five to ensure that WudStay properties offer a minimum of standard comforts to their guests – a list of 150 points. Mathur claims that this team – Wudcare – stays at the properties as users and collates feedback to share with the owner and the staff. Wudcare is an essential feature of WudStay which ensures the startup delivers on its quality promise.
A lifespan of propositions
Launched in April 2015, WudStay started out as a budget hotel aggregator, but quickly grew to offer a more comprehensive proposition. “We cater to the lifespan requirement of a user. A student user who goes to a different city like Kota or Ahmadabad to prepare for competitive examination becomes a WudStay hostel customer and gets to know the brand. Once she enters the corporate world, her business travels take her to different cities where she finds WudStay hotels. Once the customer retires, we offer retirement homes – boarding in holy cities for spiritual purposes and day boarding homes. So, the entire lifespan accommodation requirement is our proposition,” explains Mathur.
Quality and safety
The segment which has also attracted the big online travel agencies (OTA) in their bid to seek profitability is predicted to grow at a massive scale and has attracted several players. To grab a bigger share of the market the OTAs resorted to delisting and blocking hotel aggregators from their platforms in late 2014. Mathur believes WudStay is building on value propositions, which will be the final decider.
“OTA is just a listing company maintaining an online register of properties. Consumers do not want another OTA. They want somebody who can give them a guarantee of accommodation. Travel abroad has made Indians aware and they cannot be taken for granted anymore, whereas an OTA does exactly that. They have their hands free of quality. They only allow you to book a room while we go a step ahead and ensure quality,” claims Mathur.
If quality is what Mathur claims as the differentiator in WudStay hotels then safety is the prime focus in WudStay’s new proposition – homestays. Presence of international well-known brands like Airbnb does not seem to bother Mathur much. In order to fulfil its safety proposition, Mathur claims that WudStay runs physical checks on the prospective.
“There are two kinds – homestays and safe homestays. You cannot copy and paste a solution that has worked in the US. Unlike India, safety standards and legal checks are very high in the US. In India the concept will emerge out of a safe homestay. Indian consumers will not stay unless they know it’s safe. This is the reason why even after trying for five years no one has yet been able to become the brand in homestays in India,” opines Mathur.
Homestays, along with retire homes, are a new proposition by WudStay in its chain of lifespan stays. While homestays constitute the majority of the WudStay properties (2,000 out of a total 3,000), it is the hostel and hotels which bring in the most revenue. The startup that has hostels in five cities, hotels in 60 and homestays in 60 more, has a target of getting 5,000 properties under its banner by the end of 2017.
WudStay has opened multiple fronts, where at one end it is competing with players like Oyo and on the other battling world’s second most valuable startup Airbnb. Mathur claims that the startup is net positive and the investors have shown their confidence in its growth prospects by investing $3 million in its first round. The round was led by Mangrove Capital Partners and Vikas Saxena, CEO of Nimbuzz.
The startup had to fight to make space for itself in a growing, but already crowded market. Sometimes, like in Kota, the fight got literal. “Kota is a big market for us when it comes to aggregating hostels however the market was highly unorganised with 2,000 middlemen wrestling for space. Making inroads was very difficult as these middlemen felt threatened by our advent. They even tried to block our entry with fists,” shares Mathur.
However, WudStay had the backing of the Kota PG association, which had been trying to get rid of the clique. The hostel owners say that WudStay has brought structure and higher occupancy for them.
“Earlier we were forced to pay a much higher commission which was very arbitrary. Lower the occupancy, higher the commission. Also, we used to lose out on occupancy for months but with WudStay these problems have been resolved,” shares Abhishek Singh, a hostel owner in Kota. Another WudStay-affiliated hotel owner says that it proved easier to get listed on WudStay than OTAs.
Heavy discounting is a race to the bottom. There will come a day when mindless discounting will have to stop and then your customers will disappear. Businesses have to be profitable and that happens only when you are proposing something that someone wants.
SOURCE – WUDSTAY.COM