Mergers and Acquisitions

OYO's Pricing All Set to Go Dynamic with This Acquisition

Hospitality unicorn start-up OYO has acquired Copenhagen-based data science company, Danamica, with machine learning and business intelligence capabilities, specialized in dynamic pricing
OYO's Pricing All Set to Go Dynamic with This Acquisition
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Hospitality unicorn start-up OYO has acquired Copenhagen-based data science company, Danamica, with machine learning and business intelligence capabilities, specialized in dynamic pricing. 

Significance of the Acquisition

The acquisition comes at a significant juncture. OYO’s pricing, inventory allocation, and revenue management are driven by a machine learning-based algorithm for prediction and dynamic pricing.The algorithm analyzes 144,000 data points every hour and makes 60 million price changes every day with a prediction accuracy of 97%. It allows each hotel to drive max RevPAR based on its micro-location. This acquisition will help OYO to further expand its ability to use pricing as a key differentiator for real estate owners and customers.

Commenting on the acquisition, Maninder Gulati, Global Head, OYO Vacation and Urban Homes, & Chief Strategy Officer, OYO Hotels & Homes, said, “We are delighted to announce our acquisition..that will help us be more accurate with pricing, leading to higher efficiencies and yield for our real estate owners and value for money for our millions of global guests, both everyday travellers and city dwellers, that choose an OYO Vacation Homes as their abode.”

Founded in 2012 by Ritesh Aggarwal, OYO is one of the top companies in India. It has acquired firms like Leisure Group (for a whopping $415 million), Weddingz.com, Qianyu etc. OYO has done a total of 7 acquisitions and Danamica is going to be its eighth acquisition.  

Acquisitions that Paid Off

OYO’s acquisitions have more or less centred on expanding and excelling in the industry. It debuted into the co-working space by acquiring Innov8, Delhi-based co-working start-up. Innov8 gave OYO a platform to take off its property-tech endeavours. The reportedly INR 220 crore caused much uproar in the Indian startup bulletin. Similarly, acquiring Danamica could help OYO implement Machine Learning-enabled pricing and revenue management which customers will help customers book a vacation home at the best price.

Gulati also added data sciences across pricing, AI, and Imaging Sciences have been a cornerstone of OYO’s proprietary revenue enhancement technology. “It is also a huge missing piece in the way traditional vacation rentals industry is run. We are glad to have found Danamica, which has built expertise in these areas. Both Rune and Mads (Co-Founders - Danamica) are extremely talented individuals and together with their team, they have built a valuable IP that analyses many years of data and pricing trends and provides logical and scientific recommendations, which will help us scale our vacation and urban homes business across Europe and other parts of the world,” he was quoted as saying.

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