Key Success Factors and Opportunities in Online Markets for Hotel Industry

The Role of the Hotel Industry in Thailand's Economy

The hotel industry plays a vital part in Thailand’s economy, accounting for 6-7% of the country’s Gross Domestic Product (GDP) (Department of Tourism, 2021). In the past, several hotels focused primarily on serving high-end customers. However, as people become more price-sensitive, along with the high competition and 'Red Ocean' of five or four-star hotels, many hotels must adapt their strategies and portfolios by penetrating the low-income market segment. In addition, to survive in this intensely competitive business environment, three main factors are essential for the hotel industry to maintain their business in the long run.

Key Success Factors and Opportunities in Online Markets for the Hotel Industry

The primary key success factor in the hotel industry is service. Currently, for hotel and lodging businesses, success can be evidenced by a noticeable increase in repeat guests and positive comment card scores (Jones & Lockwood, 2020). Customers respond very favorably to improvements in service. However, service can make a significant difference. Some customers are willing to pay high prices in exchange for better services. Superior service delivery by an efficient and hospitable staff can be a major factor in a guest’s decision to return to your establishment rather than trying one of your competitors. A reputation for superior service can also become an important part of your establishment's unique image and identity.

Another key success factor is location. Businesses with good and suitable locations can easily gain advantages from their place. In the hotel industry, most successful businesses are located where there is a high footfall, with people coming in and out every day. If we focus on the hotel segment, businesses can benefit from locations such as those near shopping centers, business centers, and walking streets. These kinds of locations have people trading or engaging in other transactions throughout the day, allowing businesses to sell their products and services. However, good and suitable locations can incur high rental costs, yet they provide a great opportunity for place owners to run successful businesses (Smith, 2019).

Strategies for Leveraging Technology and Online Markets

Nowadays, advancements in technology allow the hotel industry to exploit the benefits of the popularity of the online market. The following strategies are recommended:

Expand brand awareness by using social media pages: CHR can easily expand its brand awareness globally by hosting its own Twitter, Instagram, and Facebook pages. This strategy will not only provide more platforms for CHR to promote itself and its properties but also broaden its social media presence, which will likely help the brand gain more attention, especially among the younger generations of guests. Moreover, guests will feel even more connected to the brand by enjoying this new insider’s look. With social media, CHR will be able to keep followers engaged and attract guests to stay at the hotels (Kaplan & Haenlein, 2010).

Mobile engagement with luxury and business travelers: Luxury travelers and business travelers are increasingly likely to book trips on mobile devices. In 2014, 156 million consumers engaged with digital travel content in the past year, up 11 percent from 2013. The percentage of consumers accessing travel sites exclusively on mobile devices is growing, reaching 62 million in 2014. The growth and scale of today’s mobile audience further illustrate the need for brands to implement a diversified cross-platform marketing strategy to effectively engage key audiences across devices throughout the travel planning process. Knowing that luxury customers and business travelers are booking more on mobile, it makes sense for CHR to advertise in this space. CHR can place their mobile advertisements on travel sites, business magazines, or luxury product/service apps to expand its brand awareness and attract more guests globally (PhoCusWright, 2014).

Bidding for ad space on popular websites: Google search is an effective form of marketing because so many people use it. Purchasing ads and sponsored stories on Facebook are useful for the same reasons. Moreover, Facebook ads can provide a business with significant exposure to billions of travelers on Facebook and to their networks. With this strategy, CHR can be exposed to potential guests very quickly and effectively (Edelman, 2010).

By strategically focusing on service, location, and leveraging online markets, hotels in Thailand and beyond can secure a competitive advantage and ensure long-term success.

References

• Department of Tourism. (2021). Thailand Tourism Statistics. Retrieved from [insert URL here]
• Edelman, D. C. (2010). Branding in the Digital Age: You're Spending Your Money in All the Wrong Places. Harvard Business Review.
• Jones, P., & Lockwood, A. (2020). Hospitality Management: An Introduction. Oxford University Press.
• Kaplan, A. M., & Haenlein, M. (2010). Users of the world, unite! The challenges and opportunities of Social Media. Business Horizons, 53(1), 59-68.
• PhoCusWright. (2014). The Mobile Travel Landscape 2014. Retrieved from [insert URL here]
• Smith, J. (2019). Location Strategies for the Hospitality Industry. Cornell Hospitality Quarterly.