Dual Hotel Pricing ?

[Barfly]

Foreigners may have to pay more for Hotels than Thais

Dual pricing could be coming to a hotel near you. That’s if a proposal from the tourism ministry and Tourism Authority of Thailand gets the go-ahead. Yes, despite Thailand tourism officials’ express wish to attract as many foreigners to Thailand at this time, there are plans to increase hotel prices to pre-pandemic levels to boost the recovery of the hospitality industry. But only for foreigners. Many hotels have been discounting their room rates to help attract as many customers as possible.

But, under the proposal, only foreigners coming to Thailand will find their hotel rooms more expensive. Local Thais will receive the discounted prices. A government spokeswoman says that the proposal is

“to maintain our standards of rates and services for foreign tourists, which affects the perception of country’s tourism brand”. “Rates that have been reduced during Covid-19 will be maintained for Thais to sustain the momentum of domestic tourism.”

The Covid pandemic dropped room occupancy rates, in some cases, to around 30-40% of their pre-Covid rates. The pandemic caused hotels in popular tourist destinations like Phuket, Bangkok, Koh Samui and Krabi to offer discounts and promotions to lure travellers. The Tourism and Sports Ministry will ask the hotel sector to adopt the dual pricing system, where foreigners are charged more than Thais. The prices would be similar to life before Covid 19. Locals won’t be affected by the change, and they can still enjoy the different promotions and discounts from hotels. The ministry and Tourism Authority of Thailand will now speak with the Hotel Association of Thailand about the dual pricing scheme. But the story is already all over social media and the response has been universally savage…

It’s still unclear how the government make it attractive to promote dual pricing to international travellers coming to Thailand with the introduction of a sanctioned policy for hotels. This would also create a problem for foreigners and expats already living in Thailand too. Earlier this week, Deputy Thai PM and public health minister, Anutin Charnvirakul compared Thailand to popular luxury brand, Louis Vuitton.

“We cannot let people come to Thailand and stay because it’s cheap. Hold your ground. Sell premium. The more expensive, the more customers. Otherwise, Louis Vuitton wouldn’t have any sales.”

Current travellers coming to Thailand are 70-80% fewer over the past month (compared to 2019), even with the removal of all restrictions for arrivals, including getting rid of the Thailand Pass. In some of the popular tourist areas, like Phuket, Pattaya, Samui and Chiang Mai, up to 50% of the hotels and accommodation options remain closed.

[Tripadvisor]

Thai hospitality sector opposes dual accommodation pricing

Many hotels have voiced their opinions over the government’s proposal to adopt dual pricing in the hospitality industry. They described the plan as “impractical” and asked that the government come up with promotions and campaigns to boost tourism instead. A government spokeswoman said yesterday that hotels would be expected to adopt a dual pricing system where Thais would continue to get lower rates while foreign tourists would be charged pre-pandemic pricing – a two-tier pricing system.

The spokesperson from the Tourism Council of Krabi said that “every customer should be treated fairly and equally.” “Clear communication is crucial, according to the head of who warned that this sensitive subject could damage the tourism industry’s reputation.”

A spokesperson for Bangkok Marriott Marquis Queen’s Park echoed similar comments. “I don’t think it’s fair. Whether we are Thai or foreigners, we should all pay the same rates.” According to the President of the Thai Hotels Association, Marisa Sukosol Nunbhakdi, the idea is unrealistic as hotel costs vary based on the state of the market. “Hotels at each star level also apply different pricing tactics. Prices will automatically rise as demand rises to maintain the occupancy rate.”

“Every hotelier would like to operate with higher and fair rates to gain a larger margin, but it is difficult to do so because of heated competition and oversupply. Operators have to use pricing strategy to gain cash flow.” A representative for Sheraton Hotels, Guntapitch Rodpun, stated that international companies like Sheraton are unlikely to change their pricing policy based on the nationality of their customers unless they are ordered to do so.

“While several hotels may have implemented a separate pricing structure for Thai nationals and foreigners in the past, we have never had that kind of pricing structure. Although we have not received any direct proposal, our hotels have always featured universal rates for Thai nationals and foreigners alike.” According to the Minister of Tourism and Sports, Phiphat Ratchakitprakarn, the government would not force hotels to implement the much debated dual pricing proposal.