Customers bargain for Thai hotel rates
Bangkok Post: 6 Sep 2010
TOURISM
Consumers driving hard bargainsConsumers are bargaining for cheaper hotel accommodations and tour packages, even though prices are already lower than a few years ago as tourism has not recovered from the global economic crisis and local political unrest.
Prakit Chinamornphong, president of the Thai Hotels Association, said customers were now more knowledgeable about pricing because they know many rooms and package tours are available in the market, chiefly because of the internet. Fierce competition and low demand have also dented prices.
"A price war is a big problem that we can't avoid," he said. "The average room rate is 20% lower than two years ago. Four-star hotels sell their rooms at the same prices as three-star hotels, so three-star hotels have to push down their rates to counter."Some four-star hotels were now selling rooms to state agencies at 1,200 baht net per night including breakfast, he added.
Kannika Fongmoon, manager of the Royal Peninsula Hotel and Royal Panerai Hotel in Chiang Mai, said customers like to bargain as much as they can, even after the hotel offered its lowest price ever of 899 baht per night including breakfast for the Royal Peninsula and 699 baht for the Royal Panerai.
But the number of visitors at the 19th Thai Tiew Thai 2010 fair, which ended yesterday, has been higher than last year. Advance bookings for the coming high season (December-January) are about 60-65%, compared to 70% in the same period last year.
"We hoped reservations would be better than last year," said Ms Kannika. "Clients asked for a cheaper price even after we offered our lowest rate. They compared our price with others and asked for more discounts. It's so difficult to run a hotel right now in Chiang Mai."
Komson Klayamee, sales manager of the 25-year-old Korean tour operator One World Service Co, agreed customers were making decisions based on price. The company expected to sell around 200 tour packages during the four-day fair, similar to last year. Around 70% of its packages are Korea tours.
"The average price of Korea package tours at the fair has dropped slightly from 20,000 baht to between 17,000 and 18,000. Quality tours to Korea are usually around 25,000 baht per package. Many operators have cut their prices to gain volume, but that will decrease quality," he said.
http://www.bangkokpost.com/business/tourism/194794/consumers-driving-hard-bargains