Hotel sector counters competition from new accommodation services

Novotel Saigon. Illustrative image (Source: VNA)

HCM City (VNA) – Since 2010, the number of 3-5-star hotels nationwide has doubled, helping enhance the competitiveness of Vietnam’s hotel system to the regional level. However, hotels also face fierce competition from new accommodation services.

Statistics from the Vietnam Hotel Association showed that in 2010, Vietnam has 388 accommodation establishments with 40,602 rooms, but in 2016, the figures rose to 788 and 91,041 respectively.

A survey by Grant Thornton Vietnam in 2017 said that 2016 was a recovery year for high-end hotels with the system’s capacity rising 5.6 percent from the previous year.

However, despite the increase in the number of foreign tourists and capacity of the hotels, the prices of high-end hotels did not increase as they faced strong competition from emerging accommodation services such as bed and breakfast (B&B), rental houses and homestays, according to the survey.

Grant Thorton Vietnam reported that there are 6,500 B&B establishments nationwide with an average price of 34 USD per night. Along with homestays, this accommodation is becoming more popular among individual tourists.

Tao Van Nghe, President of the Ho Chi Minh City Hotel Association said that apartments for rent to tourists are also part of the 4-5 star hotel market share. This was why the number of tourists rose but the price of high-end hotels did not increase, he added.

To raise their competitiveness, high-end hotels have invested heavily in services and infrastructure, while aiming to attract more domestic tourists.

Aware of the significant role of digital technology in their businesses, the hotels have also strengthened IT use in their operations.

According to Grant Thornton, the ratio of IT use in hotels rose to 67.3 percent in 2016 from 49.3 percent in 2015.

In the next 10 years, high-end hotels in Vietnam may use new technology during their operations such as check in, opening room doors, rolling up curtains or turning on TVs through smartphones, said John Gardner, CEO of Carabelle Saigon.

Heads of many hotels revealed that the number of domestic tourists staying in high-end hotels has increased.

Tony Chrisholm, Manager of Pullman Saigon Centre said that 15 years ago, domestic tourists to the hotel system accounted for just about 30 percent, while recently, the group is always the in top three largest customer groups.-VNA

VNA