A NEW hotel reservation player is looking to crack South-east Asia’s “fragmented” and “underserved” budget accommodation market by partnering hotels in three-star categories or lower and sell their unsold rooms at deep discounts.
Nida Rooms, which claims to be the “largest virtual hotel chain” in South-east Asia, was founded in September 2015 by Kaneswaran Avili, a former top executive at SpiceJet, Tigerair and AirAsia, and Dennis Melka, a Czech venture capitalist.
The hotel reservation startup entered into Thailand in February this year, and is also available in Malaysia, Indonesia and the Philippines, with over 3,000 rooms online across the four key markets.
Atakawee Choosang, Thailand country head of Global Rooms, which owns and operates Nida Rooms, hails the concept useful to small hotel owners who lack the marketing networks and financial muscle to compete with bigger brands.
“The majority of hotels in Thailand are in the budget sector. However, the one- to three-star sector is fragmented, and often comprise independent or single-location hotels,” he elaborated.
“With their limited marketing budget, it will be hard for these budget hotels to compete with (economy) brands like ibis…OTAs lean towards five-star hotels and are not usually interested in small hotels with rates lesser than 1,000 baht (US$28.30).”
Increased cross-border trade with the advent of the AEC also heralds opportunities for low-cost accommodation in frontier locations, observed Atakawee. “A lot of logistics are coming into Thailand (from China and neighbouring Indochina countries), but the highway locations are not going to be targeted by big OTAs or hotel brands – and that spells opportunities for us,” he added.
Rooms that have met its standards – i.e. clean room, comfortable bed, complimentary Wi-Fi, hot showers and air conditioning – will be branded and serviced under Nida Rooms. Guests will also receive a personalised amenity kit when they check in.
Young travellers of between 20 to 35 years old, government officials and SME owners are the targeted customers for Nida Rooms.
Currently boasting 1,400 hotels and over 7,500 rooms in Thailand, Nida Rooms hopes to scale up 3,000 hotels across the country and 10,000 hotels across the region by end-2016.
The company also has its sights set on expansion to Vietnam and Latin America, as the latter has a “fragmented” budget accommodation market like South-east Asia too, according to Atakawee.
