Oberoi and Hilton part ways, to chalk their own course

The 4 year long marketing and co-branding agreement between East India Hotels and Hilton International has been terminated effective April 2008. As such 8 ‘Trident Hilton’ properties in India having 1900 rooms would be rebranded as ‘Trident’ while the ‘The Hilton Towers’ in Mumbai would be known as ‘Trident Towers’.

The existing properties were mostly situated at leisure destinations and positioned at 5-star segment. The alliance was primarily setup wherein EIH was responsible for management and marketing in India while Hilton was responsible for the sales and marketing of the hotels worldwide.

Inspite of Trident Hilton properties accounting for 45% room inventory of East India Hotels, the occupancy rate was low and there wasn’t any significant improvement after alliance with Hilton.

As such Oberois wanted to develop ‘Trident’ brand on their own and expand their reach in business destinations such as Mumbai, Bangalore, Hyderabad, Chandigarh and Calcutta.

On the other hand, Hilton is also expanding itself and has tied up with DLF for building 75 hotels across India. It is also bringing its mid-market brand such as Garden Inn to India which Oberoi felt could have diluted their brand image since it is perceived to be an up-market brand.

Fearing this equity dilution, Oberoi earlier had parted its alliance with “The Leading Hotels of The World”.

The parting of two hotel giants could pave way for better infrastructure and more room inventory catering to different markets. However, having brand such as ‘Hilton’ could have given Oberoi hotels an edge in its international expansion.