Page 133 - HH Oct-Nov 2023

Rattan Keswani at the book launch.

Unfortunately, many companies dilute their branding wanted to succeed. Taking this advice to heart, I had
efforts in pursuit of growth. However, we were steadfast made the decision many decades later to embrace this
in our commitment to defining our brand correctly, and new model.
each hotel we selected/helped refurbish or redesign The company placed significant emphasis on team
had to meet the brand standards. comfort, compatibility, recruitment, and training.
Of course, some physical structures varied, especially Additionally, we aimed to identify the segment of
if they were already constructed. New builds had to be customers who would understand and appreciate
aligned with our brand’s architecture, design, definition, limited but differentiated offering. For those who
and services; otherwise, it would not fit the brand. The desired something beyond our price range, we were
financial models around the gross and net built up content to let them enjoy the luxury of upper-tier
areas, calculations around return per square foot and accommodation. We tried to create a new balance
optimization of work lows to enable lean staffing between a high-end pricey experience and value,
around were unique. An additional chapter in my book within our three brands. Drawing on my prior
of learnings. experience in luxury hospitality, we were able to
Lemon Tree’s success can be attributed to its ability improve our designs and standards while maintaining
to define and run the new business model in a our value proposition.
financially viable way, which has enabled them to However, in the first couple of years, we struggled to
weather even the toughest times, including the gain acceptance in the market and were at risk of
Covid-19 pandemic. This success has been built upon failing. Our initial foray into the segment was met with
their willingness to take risks and innovate. In an early little interest, and were only able to sign 263 keys. This
chat with my first mentor, Rajiv Kaul, in Delhi in 1989-90, lack of profitability was compounded by our lack of
he had impressed upon me that midscale and budget experience in managing and franchising properties in
hotels would be new segments in the future worldwide. this segment.
Rajiv had just returned after completing two courses During a conversation with the Chairman of my earlier
at Cornell University, and we were chatting one night company before my departure, he asked me about my
and he said, “A typical hospitality job will be redundant. plans and if I had any knowledge about this new world.
It will be taken over by revenue management experts I admitted that I didn’t know much about it but was
and CFOs.” He also predicted a shift towards the willing to learn and take the risk. He had explained the
budget economy and midscale models and advised difficulties that lay ahead and that it would be difficult
me to align myself with this changing landscape if I to turn profitable unless the new venture was

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