Is OYO Rooms similar to Airbnb in 2021

Is OYO Rooms similar to Airbnb?

OYO Rooms and AirBNB are by no means similar to each other, in fact, they are almost as opposite as the sky and sea.

What is the business model of OYO Rooms?

OYO contracts the local hotels and guesthouses with 2 different strategies,

  1. Re-Selling: This is the first and original model that they used since the business started, they book the hotel rooms for months in advance with huge discounts often more than 50–60%, they renovate the rooms with all the basic facilities and standardize the experience and then the room is listed on their website.
  2. Franchising Model: Once the business got the popularity they started another model of acquiring rooms. Any hotel or guesthouse who want to list their rooms on OYO has to renovate the rooms as per the standards prescribed by OYO rooms. The room will be listed under the OYO brand and OYO charges around 22% commission on each booking.

They have also started the booking the vacation homes under the same three models.

What is the business model of Airbnb?

Airbnb has a completely different business model.

Airbnb is just a marketplace where you, me or absolutely anyone can list their house/room on the platform.

I want my property on Airbnb, It just takes three steps

  1. Access their website or mobile application.
  2. Create an Account.
  3. List my property… And Boom, there I have it.

When anyone books my place AirBNB charges 3% fees from me and 6–15% commission from the guest…

The only problem with the model of Airbnb is maintaining the quality and security but they have done that very nicely.

For maintaining the quality of houses, they have issued guidelines for every host.

The main key factor of success for AirBNB is their search algorithm, the search result shows on the basis of reviews and the rating

of the varified hosts. The host has to maintain the quality and get positive reviews in order to get discovered in the search result.

For protecting the property of hosts Airbnb gives insurance to every host until the guest is living in the house.

Both Airbnb and OYO are two extreme ends when it comes to the business model.

For Comparison

OYO Rooms claims the exclusive right of the property both via franchising or via reselling. Whereas in Airbnb there are no bounds. The owner can choose to list or unlist his/her property at any time or even list the same property on multiple platforms.

When it comes to the Business mantra, OYO wants to provide standardized experience at all the places, whereas the purpose of Airbnb is to provide a new and unique experience at every different places.

Airbnb does not own or control any place listed on their site, OYO strictly controls every place listed on their site.

OYO Rooms is a b2c business model whereas Airbnb is c2c business model.

If they are both different then why people get confused between two?

It is because of their end goal, the primary goal of both AirBNB and OYO Rooms is to provide quality accommodation at a cheaper rate. So far, both have done a pretty great job.

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