Kiruba: Ramesh, welcome to the show.

Ramesh: Thank You.

Kiruba: 61000 members (figure at the time of the interview), and right now Club Mahindra is one of the most biggest and preferred holiday destination around. I’m sure it must have all started with a dream. So how and when did this dream of Club Mahindra start.

Ramesh: (smiling) Just a small correction – we are the biggest and we are the best, not one of the biggest and the best.The dream started actually in 1996. It was a dream indentified by the Mahindras. They saw an opportunity in this business, the business model was perfectly alright but it was being run differently by different people and didn’t earn itself a good name.

Infact one of the first thing I did after joining Mahindra was to do a survey about what the public thought of the Mahindras. And in the research that we did one of the imagery was that the Mahindras was compared with the Central Bank of the country and that is a big thing to start off with I suppose in any business and it had its positives in this business.We started out with those pluses but at the same time we needed to beat the path which is different. You had the oppurtunity – here you had a group with a lot of trust worthiness but you still had to make the business work and make an offering to the customer which is different.So this is where it all began and then we started out itself we said we will do something very very different.

We will not go the way everybody else, and when I said everybody else, it means few people within the country and and elsewhere in the world where this business had grown fairly large. We said we will do it differently and when I said differently not for the sake of being different but offering something which the Indian customer would want and appreciate. That is how we started off initially and I think we have managed, in this brief period of 10 years make a name for ourselves, build a brand and as you said have 61000 customers.

Kiruba: When Club Mahindra started off, it was like Mahindra was getting into Holidays!. It had a very polished image about this new product. For me it was quite a shift. Those were the days when there were no Scorpios and Boleros, this was the first customer facing product that Mahindra had come out with …

Ramesh:  I would say yes and no. It was true, that at that time when these statements were being made when the government and environment was different, and we were functioning under a license Raj. But it must be said, even at that point of time, it was one of the factors that I faced when I was joining was that Mahindras were known as a Jeep and Tractor.So what is a Jeep and Tractor company doing in this space.

Anand (Mahindra) who had taken over as Mahindra and Mahindra’s Vice Chairman and Managing Director saw a huge oppurtunity in this business and in this service space, so it was left to us then to convert this oppurtunity into a business. Which is what we did, we understood, we used the strengths of Mahindras where it mattered, which is in terms of the trustworthiness and reliability, and we charted out a path on our own. Which we were allowed to do.Yes at that time, the brand that was there was only Mahindra, the jeeps were branded as Mahindra. When we started out, we realized that we need a product or we were into an offering which was a soft offering, a fun offering.

So we went about creating the brand, at the same time we wanted to keep Mahindra there and through the brand Club Mahindra – the way we put Club and Mahindra together, because Clubbing is more social, easy, relaxed. There were lot of positive things attached to it, including fun and smile and so on.And so we used these two words together, put together a background. If you look very closely at the Club Mahindra logo its actualy about about sun, sand, sea, nature and so on.You will see the bird, you will see the sun represented there, you will see the green represented there. Thats how we created the whole thing and we felt that is what holidays are all about. So we put that together, and yes this was the first brand that the group put out. Yes there were some smaller brands in the group at that time, but this was the first brand that we embarked on. We said we need a brand. We will not go with the product.

The interesting aspect, Kiruba, is that worldwide there are very few companies, and really few companies which have built a brand in this industry (timeshare).They have all thought of it as selling membership and forgetting about it, whereas we have thought of it as a long relationship with our customers and hence the need to build a brand and so we built the brand.Subsequently it has helped us that Mahindras has built a lot of brands Scorpio, Bolero and so on, but all these brands together are working and strengthening each other. Even today if you would ask me about the Club Mahindra brand I would say it is half and half. Mahindras still bring 50% of the strength into the brand, and our own offerings, our own experiences I think is the other half.

Kiruba:Let us talk about when you initially started off, where Club Mahindra is like a start-up and you are like the entrepreneur who founded it. Tell us something about the experience, what is the first resort that you started out and some of the interesting incidences that go along with it.

Ramesh: (smiling) Let me talk about it Kiruba, and I will be talking for hours together. It is a great experience because the first thing was to create an identity within a large group, as you said a conglomerate. We had the head quarters in Chennai, this was the first company of Mahindras which moved in to Chennai…

Kiruba: Interestingly, why Chennai

Ramesh: Two very simple reasons. Chennai had a few people from the industry, so it had some competencies, and Chennai was cheaper and of course I liked Chennai and so did a lot of people. Also Mahindras did not have any objection and they said that if it suits the business, and it can run then its perfectly alright – thats how it happened.So initially it was a task of identifying yourself in a big group, and I must say Mahindras allowed that flexibility, allowed the entrepreneur in you to work and setup the company.
There was very active encouragement in terms of setting up. So initially I was the loneranger in the company, I was employee no. 1 (smiling) in Mahindra resorts, then slowly we started putting together the group and two months down the line we shifted office.Then came the incorporation of the name Mahindra Holidays and Resorts India Limited, and then came the brand and then came this critical question of where are we going to setup our first resort. By that time we had worked on our product, on what we were going to offer which was very very different from what everybody else did in the market. We offered a flexible product, normally people had a very cut and dry method, a cookie cutter model for this business and they used to run it.We did it very differently, we created a product which was flexible, and when we created the product we didnt look at only the person who signed the cheque or pay for the product.

We looked at who is going to consume the product, which is the person who paid for the cheque and his entire family. So we created a product which suited all of them.And then there was always this element of fun about the product. We put it all together – that was there, and then we created the branding, and then we started looking, and we said we will not go to the usual places because the moment we go to the usual places …I mean we had the options, of going to Ooty, Kodaikanal, Goa or ….you know a Mahabaleshwar, or any of the well known holiday places. (But) We said that if we are going to cut a path that is different, then we’ll do it right from the beginning.And we chose this “gorgeous” place, and I must say gorgeous ….called Munnar.

Kiruba: ..and this was in the year?

Ramesh: This was in the year (trying to recollect) 1997.

Kiruba: …one of those places that is untouched and pristine.

Ramesh: ..oh very untouched. And I must say that Munnar is still pretty untouched because a lot of the plantations is owned by Tata. But then the fact is that very few people knew Munnar. Infact when in Bombay when we used to sell, they would ask “Munnar where”? Today its not the case, I mean we have put Munnar on the map. But we went 20 kms outside Munnar and we selected the site which reminds you of some place in Scotland, very scenic …and we set up our resort there, and that helped us establish our identity.It helped us in both ways, with the customer and ourselves, our own confidence saying we can go and create destinations and give our customers and their family a great holiday.

And at that point of time, one of the biggest highs that I’ve had, and I must mention it here was the first time when I went to see the land in Munnar, it was in the monsoon, it was raining. We had to wade through bushes and plants, and we had to check our legs for leeches (smiling), and one and a half years down the line we had this beautiful resort.

Kiruba: ..that was your first born baby

Ramesh: (smiling) Absolutely, its a total high, a great feeling and I think that was the period when a lot of our rules got set, or should I say practices were set. And then we were confident enough to go elsewhere, of course then we set up the second resort which is Goa, and in the meantime when we were setting up this resort we hired places so that our customers could still have holidays. We didnt tell them wait till we build our first resort.Munnar has been a very successful resort and a very good resort, and a good beginning for us.

Kiruba: Now in the entire building of the company process, Im sure there were tons of challenges you’ve faced. If you could elaborate one such big challenge that you faced, and how did you overcome it.

Ramesh: Ok. The first and the biggest challenge was being able to tell your customer what the product and service is all about, to be able to create the dream of a holiday in their mind, and to ask them to write out a cheque for a product that they haven’t seen …and give them a membership certificate in return.

Kiruba: …which is a paper right?

Ramesh: …yes, which is a paper…absolutely. Actually slightly better than a paper, its a thick, cardboard sheet (laughs). Now that is the biggest challenge because you had to be to convey to them, and we went and did this. This was the first major challenge I would say, more than anything else. That you had to bring in the credibility of the Mahindras …I had to balance both sides.One of the things that the Mahindras told us is that we know in this business there are lot of practices, but whatever you do, you must add to the Mahindra brand and not subtract from it.

And that is something all of us in the company are committed to doing. So you had to do sales, not do any of the practices which anybody else did, and at the same time convince the customer.We were one of the first to tell the customers that you have recission period …we implemented that without anybody telling us which means the customer who buys the product can actually change his decision, which means he says he doesnt want it and he gets 100% of his money back. It is also known as the cooling off period.

We initially started off with a 1 month cooling off period, and we told our customers that you can return it anytime in between. Of course story is that hardly anybody returned …and we went on.

Kiruba: It is a risky decision isn’t it.Ramesh. Yes it is a risky decision. But then Mahindras backed us up at every step. They said alright please go ahead. You know, no other product …you take the money and then return, but they said go ahead, if that is what is required. We still have the recission, incidentally it is 15 days, but it is still there. We have not taken it off, and our action has forced everybody else to introduce it into the industry. I would consider that as the first, biggest, challenge that we faced.

Kiruba: When a lot of companies are turning a blind eye to new media, Club Mahindra has been one of the very few companies to start focusing on blog, podcast and the entire social media. So what prompted you to get into it.

Ramesh: As a company we have always been innovative. As I said, right from the beginning we didnt go to a Goa, we went to a Munnar. While everybody else was saying how to get the customer to put down a cheque and get off, we were allowing the customer to rethink.

I think the same thing applied for technology. One of the trends that we noticed was that technology was becoming an enabler, in a whole lot of things. Lot of people were getting into techology, so we said we should also get into technology, we should use technology both to make it easier to make it for the customer and for us.And that has made it easier all along. We have for example a website where a customer could check for availability, we have developed the capability where a customer could actually come in and do reservations (we haven’t activated it yet).

We have connected all our offices via VSATs right from the beginning, because we said communication is a must between offices and to be able to service customers. So always we have spent money on technology, primarily because we realize we can service our customers that way. Information flows can be that much better and we have done it in several different ways. As we speak, we have invested money in a CRM product, which will helps us predict customer preferences. We are trying it, experimenting it in a small way, to do it in the area of rooms and F&B. Its actually much more complicated than what it sounds because you need to be able to get the information from the customer on his preferences.For e.g. someone likes their coffee without sugar or whatever, and its not enough and when I mean customer there is a difference.

We have a member and we have a customer. We have 61000 members, but we have 61000×4 and those are our customers. So when you walk-in I need to know Kiruba’s like his coffee a certain way. So I need to get the information, I need to be able to validate that information. And 5 years from now if Kiruba then likes to have not Indian coffee, but Jamaican coffee then I need to know that too (laughs). So I need to constantly collect that information and validate it. So its far more complicated than what it sounds.But thats what we’ve embarked on. And as Ive said, we dont hesitate to do something difficult, and we dont hesitate to work with technology and we do it all the time.

Kiruba: Fantastic …and its good that you’ve started with blogs and podcasting. Gets a human face to the company.

Ramesh: See, We started slowly one-by-one. We have a fairly robust customer response systems. In all our resorts, we have something called the HEP (Holiday Experience Profiler). Essentially what it means is that a touch screen monitor is placed in the lobby, the restaurant and the holiday activity area.

All customers are given a password, so if they have a feedback, they can enter into this and it immediately hits the concerned head of department and they are supposed to act within half an hour, otherwise it gets escalated to the resort manager. Now this is real time solution, normally all service providers get a feedback at the end of it. We do it while the people are there so that we can act on it and solve it. So this is one way of using technology.And then we went on to websites which had the mechanism to collect feedback …and evolving from there on to blogs. We said we must be active in all these area.  We already have something on the intranet, but its now coming out to the outside world.

Kiruba: Another thing is about internet connectivity in resorts. I know when you are on a vacation, not having Internet is good, but having Internet lets you balance your work and vacation. What is your take on it.

Ramesh: Customers have different preferences. You can position yourself as a resort with no TV and you can position yourself as a resort with TV because the TV has an on/off button. If somebody doesnt want it, they switch it off! Its as simple as that. And we have taken that position because we think customers taste and choice vary. I’ve had this experience in a resort.

On the first table, somebody was complimenting me on a particular dish and on the third table somebody was actually complaining about that dish. Now that is how taste runs.The same things goes for Internet and everything else. So we have internet connectivity in all our resorts, and for us internet connectivity is an enabler. We will also extend it to the rooms, and do a whole of things. We are not hesitant to use technology. We also have quite places where you are beyond technology and you are one with nature. So if you want, you have that choice too.The idea is, we will do whatever it takes to keep our members and their families happy.

Kiruba: So how did, and why did you come up with Zest holidays.

Ramesh: Again as we said, we recognised a segment, we recognised a need and we recognised a business oppurtunity. This is one of its kind and I think you will find a similar product not only here but around the world. But we recognised the oppurtunity, and we decided we will go ahead.

Kiruba: So Zest is for people with no time, just the weekend, and working professionals.
Ramesh: Absolutely. Zest is for short breaks. People may go on longer breaks but we realised that todays professionals and especially in the age group 25-37, people work hard and they also keep taking breaks. The earlier system of taking an annual vacation only, and otherwise you work is now gone.

People are taking breaks, and we realised this is something that we can offer. Then the question was always, why cant you offer the same product with the existing resort. We said no. Because this particular segments need for holidays are very different, so we are creating resorts that are highly specialised for Zest, which are drive to resorts. So Zest is something which we think is the most happening product in the holiday segment. It is something very new and something which is going to take our company to the next level.

Kiruba: Lets talk about Ramesh the person. Are you the perennially hardworking CEO or do you walk the talk and actually take holidays.

Ramesh:  (smiling) I suppose there is no way of getting out of hardwork, and especially in these years when there are so many oppurtunities present. But then I do take my holidays, my weekends. So there is a nice balance. There is only one thing though, for us if you don’t use the word Holidays in the correct sense, Holidays is work for us. Because thats what we are working for all the time for all our customers(laughing).

But time off outside of work, yes we do take our holidays. But then every holiday you go to, you are constantly evaluating in your mind …that is something I’m not able to get out of (laughing). And then my family is worried because you are analysing the food, you are going and talking to somebody. For e.g. I went to South Africa in 2006, and I bought a whole lot of pictures of windows (smiling). So we’ve now decided to keep two cameras. They’ll do what they want and I will do what I want, but then I guess it happens, the occupational hazard (smiling). But I enjoy doing it, so thats alright.

Kiruba: Your profile says your interest is carnatic music. Are you a singer?

Ramesh: If you call knowing lot of two lines is singing, then yes (smiling). Some knowledge is there, I think its also because it came up in the family. Carnatic music is something I enjoy, it is something i have in the car and at home and so on. Its a family interest; my wife also sings. Its more of an interest than anything else.Other than that, there is an interest in art and painting. I enjoy them and pick up paintings ..things which I like and which I can put up with.

Kiruba: Now here is a quick bouncer to end up the interview. Tell us something which your employees around watching this show wouldn’t know about you.

Ramesh: (smiling) Sometimes I think they dont know what a fun loving person I am, probably because of the seriousness of the business that facet doesn’t come out. So though we deliver lot of fun to our customers, do we enjoy as much in the office? I dont think so. Thats one side of myself I need to open out to people here.

Kiruba: Alright, fantastic. Thanks for your time and for the interview.

Ramesh: Thanks Kiruba.