Thailand needs to move beyond its ‘Amazing’ brand, embrace quality tourism and build “mega-attractions” instead of more hotel rooms that only end up being discounted, according to David Keen, CEO of Bangkok-based brand strategy and communications agency, Keen.
Keen’s comments follow those of Thailand’s Prime Minister, Abhisit Vejjajiva, who told his country’s travel industry leaders at the ‘Thai Tourism in the Next Decade’ forum on 2 March 2011 that the country needs to focus more on quality tourism.
“To me that means we need to attract higher yield, higher disposable income, higher spending leisure and business visitors,” said Keen. “Prime Minister Abhisit is to be saluted for his opinion. Thailand needs to move away from its dependence on increasingly irrelevant, low yield mass tourism.”
Official government statistics show that the country’s international arrivals in 2011 will reach about 16.6 million, an increase of 4.4%. This follows annual tourism growth of 7.5% between 2005 and 2010, with visitor arrivals growing from 11.5 million in 2005 to around 15.8 million last year. Keen however, said the statistics were “misleading”.
“Look closer and you’ll discover that long-haul, long stay, higher spending visitors are being replaced by shorter stay mid-market visitors who spend less per capita per visit,” he said. “A new and unsustainable trend has emerged. The country has to run faster to stay still. Because more tourists stay shorter and spend less, Thailand needs to maintain double digit growth in arrivals just to match the preceding year’s tourism earnings.”
Keen added that increased hotel beds aircraft seats are creating a state of over-capacity in Thailand.
“Empty hotel rooms and low load factors are causing price dumping and desperate short-term marketing pitches to mass market suppliers,” said Keen. “I am increasingly concerned. The over supply of rooms and seats are among key factors pushing Thailand’s brand reputation into a downward spiral. Huge volume, cost-conscious tourists bring the country’s brand down, which in turn attracts lower yield tourists.”
Keen also cited political instability, long queues at Bangkok’s Suvarnabhumi airport, over-crowding and environmental degradation as factors which are becoming increasingly damaging to Thailand’s brand image. These problems are making Thailand “amazing for all the wrong reasons”, according to Keen, and he warned that the country would lose out to alternative destinations such as Malaysia, Vietnam, Sri Lanka and the Maldives.
“Old lessons have still not been learned. More hotels are being built. In February the Thai Hotel Association reported that 2,282 new hotel rooms would be added in Bangkok this year. No wonder a similar standard property in Singapore or Hong Kong charges US$350 a night compared to US$150 in Bangkok,” said Keen. “These numbers give serious pause to international luxury hotel brands. Luxury accommodation brands will only continue to invest in your country if they believe they can attract high yield returns.
“If you’re going to build, stop building so many hotels and start building iconic mega projects,” he said, citing the examples of Singapore integrated resorts, and Hong Kong’s Disneyland and Ngong Ping 360 attractions. Thailand, Keen argued, has “very little new to offer except more amazing sales and discount prices”.
“My hope is that Thailand will unite to build brand equity. We should move on from the worn out ‘Amazing Thailand’ mantra to a new era based on higher yield, higher value leisure and business visitors,” Keen concluded.
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