Financial Daily from THE HINDU group of publications
Wednesday, Aug 25, 2004
Corporate - Alliances & Joint Ventures
Taj Hotels forges tie-up with Raffles International
Mr Raymond Bickson, Managing Director, The Indian Hotels Company Ltd, with Ms Jennie Chua, Chairperson & Chief Executive Officer, Raffles International, Singapore, at a ceremony in Mumbai. _ Paul Noronha
Mumbai Aug. 24
TAJ Hotels, Resorts and Palaces has joined the Singapore-based Raffles International Ltd in a marketing alliance that aims to leverage cross-promotional opportunities.
Raffles International is the hotel management arm of Raffles Holdings Ltd, a hospitality company listed on the Singapore Exchange Securities Trading Ltd. To start with, the alliance would cover 14 hotels under the Taj Luxury Hotels portfolio and a collection of 12 luxury hotels under the Raffles Hotels and Resorts umbrella.
The two companies signed an agreement to this effect in Singapore on August 19. The marketing alliance comes into effect from today.
Each hotel will promote the other at various levels: through their respective loyalty programmes (Taj InnerCircle and Raffles Elite); marketing activities including joint participation at trade fairs by their sales teams, through links on their respective Web sites, and through brochures and promotional material. The hotels' respective newsletters, namely, Taj News and Raffles World, would also communicate news to a large client base.
According to Mr Raymond Bickson, Managing Director, The Indian Hotels Company Ltd, both Taj and Raffles were big players in their respective markets, and the global alliance was the way forward for both.
"Such an alliance will encourage our staff to think globally and in an enlightened and intelligent way, which will help us grow and expand in the next century," Mr Bickson said.
He added that over the past few years, international brands with strong guest databases had set up shop in India. For comparatively smaller hotel chains such as the Taj and Raffles, a marketing alliance was the way to reach out in the other's market and also present a larger portfolio to their customers.
The "marriage" of the two hotel chains would help each player extend the foot print of the other across the globe through cross-marketing initiatives, said Ms Jennie Chua, Chairman & Chief Executive Officer, Raffles Hotels & Resorts. These cross-marketing efforts would be in addition to the marketing programmes that each hotel would run for itself, she said.
The marketing alliance represented a good "fit" in terms of both the size and geographical presence of both players, said Ms Chua.
While Raffles had a chain of 38 hotels in 33 destinations across the globe, the Taj had 70 hotels in 48 destinations, with a majority of the hotels being in India.
She added that the agreement had come about when both inbound and outbound tourism into India was growing. The alliance would help Raffles leverage the potential of the Indian market. This was crucial considering that Raffles did not plan to add a property in the country even in the medium term.
Marketing alliances, she said, were preferable to joint branding exercise, especially where "good brands" are concerned. Such an arrangement allowed the hotel in question to enter into as many marketing tie-ups as it thought right. Raffles currently has marketing alliances with the Okura Hotels and Resorts in Japan, the Blue Tree Hotel chain in Brazil, and the Colorado-based Forbes Trinchera Ranch.
Under the alliance, members of the Taj InnerCircle and Raffles Elite would be able to avail themselves of special amenities and privileges such as upgradation of rooms and extended check-out time at the participating hotels.
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