Asia hotel market is witnessing a robust revival, with expectations to return to pre-pandemic levels in 2024. Based on “Asia Hotel Brand Blueprint 2023” released by Outbox and Vero, CBRE exposes positive trends in tourism arrivals and hotel performance, driven by domestic travel demand.

1/ Travel Resurgence Factors

Asia leads in travel resurgence, propelled by factors such as a rising middle class, demographic strength, and surging travel demand. The region has outpaced others in international and domestic travel growth, reflecting its strong position in the global tourism landscape.

2/ Hotel Industry Dynamics

Despite challenges, hotel investments in Asia Pacific are dynamic, with a focus on upscale and upper-upscale developments. Asia-based hotel groups like Minor Hotels Group and Dusit Thani are strategically expanding, capitalizing on regional visibility and market presence.

3/ Construction Pipeline and Top Players

The hotel construction pipeline remains strong, particularly in India, Vietnam, Thailand, Indonesia, and Japan. The top five franchise companies, including Hilton, lead in projects and rooms under construction, indicating sustained industry growth.

4/ Asia’s Hospitality Landscape

While international chains like Hilton, Marriot, Holiday Inn lead the upper-upscale tier, Asian hospitality giants Lotte and Aston are making waves in the upscale hotel segment. This shift highlights the growing strength and influence of Asian brands, shaping the regional market and adding diversity to the spectrum of upscale experiences available to travelers.

Despite this, global hotel brands, notably Hilton, maintain an advantage in brand familiarity over local counterparts. This preference suggests a strong inclination among travelers for the reliability and consistency associated with globally recognized names.

5/ Future Outlook

As Asia’s hotel market evolves, differentiation and innovation will be crucial for success in this competitive landscape. The region’s dynamic growth and strategic investments position Asia as a key player in the global hospitality industry, presenting opportunities and challenges.

For deeper insights, immerse yourself in our latest report, “Asia Hotel Brand Blueprint 2023.” This comprehensive guide goes hand in hand with our model Asia Hotel Brand Survey providing a holistic view of the evolving hospitality landscape. Beyond data, it serves as lens into the soul of the market, capturing the heartbeat of trends and enabling actionable insights.

Introduction

Large hotel groups and boutique brands are in a race to establish their presence in the ever-growing and competitive consumer market in Asia. To distinguish themselves, hotel brands must skillfully address emerging travel trends, meeting the increasing demand for self-planned trips, community involvement, and participation in sustainability efforts. Following a period of recovery from the global pandemic and economic decline, the Asian tourism sector is displaying signs of revitalization. In 2023, countries in Asia are witnessing a strong resurgence in tourism, marked by a significant increase in tourist arrivals, along with a resurgence of travel businesses and hotels capitalizing on growth opportunities and initiating new investment projects.

As we conclude 2023, a memorable journey for tourism industry, The Outbox Company (Outbox), in collaboration with Vero, is releasing the ASIA HOTEL BRAND BLUEPRINT 2023 report, providing readers with research data on Asian hotel market, offering a comprehensive view of the landscape for brands as well as the new shifts in traveler behavior within the region. Not only helping companies in the industry gain fresh insights into the hotel market in 2023, this white paper is also a crucial and useful source of information for predicting new opportunities and challenges in 2024.

In this report, to understand more about travelers’ preferences and brand perceptions, an online survey was conducted across seven Asian countries: Vietnam, Thailand, Singapore, Japan, South Korea, Malaysia, and Indonesia. Outbox utilized ASIA BRAND HOTEL SURVEY solution to provide in-depth insights into the level of awareness, familiarity, and perception of customers in the Asian region towards hotel brands.

Together with Outbox, Vero provides essential strategic advisories, specifically designed for hotel brands to thrive in the dynamic competitive landscape in Asia.

Key Content

The whitepaper “Asia Hotel Brand Blueprint 2023” includes 3 main parts:

1/ Asia Hotel Market

The Asian hotel market continues to grow as travel demand returns: Accordingly, the recovery is primarily driven by domestic tourism, while international arrivals to the region are increasing but still significantly below pre-pandemic levels. Hotel chains are expanding across Asia, with investments in hotels in the Asia-Pacific region experiencing a slight decrease due to difficulties from global economic downturn, such as rising interest rates, cost inflation, and increasing macroeconomic instability. Despite these challenges, there are still positive signs for the industry, and investors may continue long-term projects. However, hotel construction pipelines in the Asia-Pacific region remain robust, indicating a positive outlook for the region’s tourism sector.

2/ Asia Hotel Brand Blueprint

• Hotel Brand Awareness: Hilton is the top brand in the upper upscale segment with a brand awareness of 60.1%. This is significantly higher than the next closest competitor, Marriott, which has a brand awareness of 47,7%. IHG’s leadership in the midscale and upper-scale segments is a testament to the high awareness scores of its Holiday Inn and Holiday Inn Express brands. Two Asian giants, Lotte and Aston, are making waves in the upscale hotel segment, showcasing the growing strength and influence of Asian hospitality brands in the regional market.
  
  

  Most Popular Hotel Brands in Asia (by Market)

   

• Hotel Brand Familiarity: International hotel brands hold a significant advantage over local or regional brands in terms of brand familiarity across the Asia – Pacific region. This dominance suggests a strong preference among travelers in this market for the reliability and consistency that come with established global names.
• Hotel Brand Image: Brand values are evaluated by both rational (which are closely linked with the products/services itself) and those based on more emotional factors (which is how the brand makes people feel).

3/ Future Proofing Hotel Brands

Travel is undergoing a transformation anchored in three key shifts – self-planning, authenticity, and environmental awareness — are the driving forces behind the latest trends in travel, ushering in a new era of exploration and compelling hotel brands to offer services beyond the ordinary.

All details are contained in the full report “Asia Hotel Brand Blueprint 2023” released by The Outbox Company.

International tourism is steadily gaining momentum, while Southeast Asia (SEA) remains stable n in October 2023, with a minor 1.8% increase in international visitors from 6,193,292 to 6,305,273 (excluding Malaysia). Catch up more details about SEA tourism with the reading below!

During the first 9 months of 2023, as per the recent updates from UNWTO, global tourism is on a robust rebound, achieving 87% of pre-pandemic levels, totaling 975 million international arrivals. Despite progress, the SEA region lags behind with a recovery rate of 70%. In this October:

• Thailand maintains its leading position as the top destination for international visitors in the region. There was a slight upswing in tourist arrivals, with a 3.1% increase compared to September. 
• Singapore follows closely in second place, with a 6.7% decrease compared to September. 
• Vietnam has taken over Indonesia’s position and now ranks third, with a modest 5,5% rise in tourist arrivals compared to September in the region.

Additionally, while the Philippines and Cambodia experienced a modest increase, Indonesia went through a slight decrease compared to the previous month. 

Recovery Rate and Tourism Targets

• Cambodia nearly achieves its target, with the highest recovery rate with 99.70%.
• Singapore maintains its position in second place with a recovery rate of 73.86%, while Indonesia secures the third spot with a recovery rate of 72.67%. 
• Vietnam has attributed an adjusted goal shifting from 8,000,000 to 12,000,000 visitors. 
• The other countries experienced a slight upturn when measured against the same period in 2019.

HIGHLIGHTS

Top 3 SEA Tourism Destinations with the Highest Number of International Visitors in October 2023

• Thailand: 2,197,017 international visitors, a 3.1% increase compared to September 2023
• Singapore: 1,130,000 international visitors, a 6.7% decrease compared to September 2023
• Vietnam: 1,112,526 international visitors, a 5.5% increase compared to September 2023, pushing Indonesia out of the top three.

Recovery Rate

• Cambodia achieved a recovery rate of 99.70%
• Singapore achieved a recovery rate of 73.86%
• Vietnam achieved a recovery rate of 72.67%.

Aviation

1. Domestic Landscape

The Hanoi (HAN) to Ho Chi Minh City (SGN) route remains the premier choice, experiencing a noteworthy 10% surge compared to the previous month in a total of 826,817 seats. 

Conversely, other domestic routes in the region witnessed a decline in demand. Following the HAN-SGN route is the Jakarta (CGK) to Kota Makassar (UPG) route with 537,670 seats, and to Bali with 492,881 seats.

2. International Landscape

Singapore maintains its prominence as a key hub in SEA tourism, with seven out of the top ten international routes in the region either starting or ending there. Accordingly, the routes from Kuala Lumpur, Jakarta, and Bangkok to Singapore remain the busiest international routes in the region, despite a slight decrease compared to the previous month.

Southeast Asia tourism performance experienced a significant decline in September 2023, with an 18% decrease in international tourist arrivals from 7,029,210 to 5,750,050 visitors.

Although Thailand still holds the top spot in the list of countries with the highest number of international visitors in the region, it experienced the largest decline in tourist arrivals compared to the previous month, with a 31.6% decrease in September compared to August. The other countries in the region also saw negative growth in tourist arrivals compared to the previous month, with Indonesia experiencing the smallest decrease. This helped Indonesia surpass Vietnam to regain a spot in the top three countries with the highest number of tourist arrivals in the region for the month, alongside Thailand and Singapore.

Recovery Rate and Tourism Targets

Cambodia achieved almost complete recovery in September, with a recovery index of 93.61%. The other countries had relatively average recovery rates compared to the same period in 2019.

For the 2023 targets, Vietnam and Indonesia officially became the first two countries in the region to surpass their annual targets. Vietnam led the way with a completion rate of 111.07%, followed by Indonesia with a completion rate of 100.08%. Starting from October 2023, Vietnam also announced an adjustment to its annual target, increasing it to 12 million visitors.

Highlights

The top three Southeast Asian destinations with the highest number of international visitors in September 2023:

• Thailand: 1,687,354 international visitors, a 31.63% decrease compared to August 2023
• Singapore: 1,130,755 international visitors, a 13.6% decrease compared to August 2023
• Indonesia: 1,070,245 international visitors, a 5.5% decrease compared to July 2023, pushing Vietnam out of the top three.

In term of Recovery rate:

• Cambodia achieved a recovery rate of 93.61%
• Singapore achieved a recovery rate of 77.45%
• Vietnam achieved a recovery rate of 77.07%.

In term of Aviation:

The Hanoi (HAN) to Ho Chi Minh City (SGN) route continued to be the most popular domestic route in Southeast Asia, with a slight decrease of 5.9% compared to the previous month, totaling 749 thousand seats. Other domestic routes in the Southeast Asian region also experienced a decrease in domestic flight demand, except for the Jakarta – Kota Makassar route, which maintained a growth rate of 6.3% compared to the previous month.

For international routes, Singapore remained an important hub in Southeast Asia, with seven out of the top ten international routes in the region either starting or ending there. The routes from Kuala Lumpur, Jakarta, and Bangkok to Singapore were still the busiest international routes in the region, with slight growth compared to the previous month.

Southeast Asia tourism performance remained relatively flat in August 2023, with a slight but insignificant decrease in international tourist arrivals from 7,045,482 to 7,029,210 visitors.

Thailand remains the most popular tourist destination in the region, while Cambodia has the highest recovery rate. Vietnam has already surpassed its 2023 tourism target as of September, with more than 8.8 million visits (reaching 110%).

Recovery and Tourism Target Rate

By August, Cambodia was on the verge of full recovery with a recovery index of 89%. Vietnam was not far behind, securing the second position with a recovery rate of 80%, and Singapore followed closely with a 75% recovery rate.

When it comes to meeting their 2023 targets, Vietnam was in the lead with a completion rate of 97.89%, having welcomed a total of 7.8 million international visitors. By September, Vietnam had surpassed its 2023 target, with the arrival of 8.8 million international visitors.

Highlights

Top 3 Southeast Asian destinations with the largest numbers of international arrivals in August 2023:

Thailand: Welcomed 2,468,042 international arrivals, just a slight drop of only 0.91% compared to July 2023
Singapore: Welcomed 1,308,824 international arrivals, a drop 7.8% compared to July 2023
Vietnam: Welcomed 1,217,421 international arrivals in increase 17% compared to July, taking Indonesia out of top 3

In terms of recovery rate:

Cambodia: Achieved a recovery rate of 89.44%
Vietnam: Achieved a recovery rate of 80.49%
Singapore: Achieved a recovery rate of 75.22%

In term of Aviation

According to OAG, Indonesia holds the title for the largest capacity in Southeast Asia, contributing to 30% of the region’s capacity with 10.5 million seats. Following closely is Thailand, which has now risen to the second position with a capacity of 5.9 million seats in September 2023, making up 17% of the region’s capacity. Despite a reduction of 17% in capacity compared to the previous month, Vietnam secured the third spot with 5.5 million seats, accounting for 16% of the region’s capacity.

The Hanoi (HAN) to Ho Chi Minh City (SGN) route continues to be the most popular domestic route in Southeast Asia, even with a 17% decrease from the previous month, totaling 797k seats. Other domestic routes in Vietnam also saw a significant decrease in capacity, with a 40% drop on the Da Nang (DAD) to Hanoi (HAN) route and a 24% decrease on the Da Nang (DAD) to Ho Chi Minh City (SGN) route. Half of the top ten domestic routes in Southeast Asia are within Indonesia, with Jakarta (CGK) to Denpasar-Bali (DPS) being the largest among them.

Singapore remains a crucial hub in Southeast Asia, with seven out of the top ten international routes in the region either starting or ending there. The busiest route is Kuala Lumpur (KUL) to Singapore (SIN), which has a capacity of 419k seats. The Manila (MNL) to Singapore (SIN) and Bangkok Don Mueang International (DMK) to Kuala Lumpur (KUL) routes saw the most growth among the top ten, increasing by 9% and 6%, respectively.

Tourism in Southeast Asia continued its recovery in July 2023, with all countries in the region reporting positive growth. For the first time, the region is experiencing growth across the board. International tourist arrivals increased by 12.31%, from 6,273,312 to 7,045,482 arrivals.

In terms of leading positions in categories, there are not many changes. Thailand remains the top destination for international tourists in Southeast Asia. Cambodia is the country with the highest recovery rate in the region. And Vietnam is the country with the highest target completion rate as of July 2023.

Recovery and Tourism Target Rate

As of July, Cambodia had an impressive recovery index and was close to achieving full recovery with 91.4%. Vietnam held the second place with a recovery rate of 78.93%, closely followed by Singapore at 78.87%.

In terms of achieving their 2023 target, Vietnam led with a completion rate of 82.67%, welcoming a total of 6.6 million international arrivals. However, despite being the most visited country with over 15 million arrivals, Thailand had the lowest target completion rate in the region at only 51.35%. Singapore, the second most visited country with 7.7 million arrivals, had the second lowest target completion rate at just 55%. Given the contrast, the pressing question that emerges is: should the country celebrate upon reaching the highest target, or should it take a moment to pause and engage in deeper reflection among the tourism performance compared to other countries?

Here are some highlights

Top 3 Southeast Asian destinations with the largest numbers of international arrivals in July 2023:

Thailand: Welcomed 2,490,643 international arrivals and achieved its highest growth rate of the year at 10%.
Singapore: Welcomed 1,419,606 international arrivals and achieved the highest growth rate in the region at 25% compared to last month.
Indonesia: Welcomed 1,122,954 international arrivals and achieved a growth rate of 5% for two consecutive months.

In terms of recovery rate:

Cambodia: Achieved a recovery rate of 91.04%
Vietnam: Achieved a recovery rate of 78.93%
Singapore: Achieved a recovery rate of 78.87%\

In terms of Aviation Sector:

In the aviation sector, Indonesia continues to hold the largest capacity in Southeast Asia, accounting for 29% of the region’s capacity with 10.7 million seats. Vietnam follows as the second largest, offering 6.7 million seats in August 2023, which is 18% of the region’s capacity, despite a 6% decline from July 2023. Thailand ranks third with 6.3 million seats, making up 17% of the region’s capacity, marking a 3% increase from the previous month.

When it comes to domestic flights, the Hanoi (HAN) to Ho Chi Minh City (SGN) route remains the most popular in Southeast Asia with 978k seats, even with a decrease of 2% from July 2023. The top ten domestic routes in the region remain unchanged, half of which are internal flights within Indonesia. The route from Jakarta to Surabaya saw the most significant growth in capacity, increasing by 18% compared to July 2023.

In terms of international flights, Singapore maintains its position as a key hub in Southeast Asia, with seven out of the top ten international routes either starting or ending in Singapore. The busiest route remains Kuala Lumpur (KUL) to Singapore (SIN) with 408k seats. The top four international routes involve Singapore and other major regional hub airports – Kuala Lumpur (KUL), Jakarta (CGK), Bangkok (BKK), and Denpasar-Bali (DPS).