The Philippines’ new star rating system for hotels has been marred by controversy, with the trade questioning the relevance and fairness of the assessment. By Rosa Ocampo

In an age where travellers heed user-generated online reviews and many travel agencies devise their own hotel rating schemes, are hotel star ratings still relevant or have they become obsolete?

This is the bone of contention when the Philippine Department of Tourism (DoT) adopted a new star rating to replace its previous system, which classified hotels as economy, standard, first class or deluxe and resorts as A, AA or AAA. The DoT wants a more consistent rating system nationwide, as the previous system was often mistaken as a judge of the quality of hotel rooms rather than the quality of the entire hotel.

The new system is meant “to establish an official, transparent and more objective hotel classification system”, explained Philippine tourism secretary Ramon Jimenez Jr, so that “the travelling public can expect consistency in the standards of accommodation facilities and services throughout the country”.

Before the star rating was conceived in 2012, “the Philippines was the only nation in Asia that did not use a similar star rating”, said Jimenez. “Star rating is an internationally accepted classification system,” he added.

However, the lack of a uniform global star rating process means that the ranking criteria varies from one awarding organisation to another and from country to country, industry sources pointed out.

DoT’s controversial auditing process and objectivity of its evaluators have since come under fire. There are two main areas a hotel is rated for. Firstly, the state of the physical property; and secondly, things not related to the construct such as food quality, service standard and linen type, which can be highly subjective.

Questions too are being raised on the propriety of the DoT implementing a star rating programme for the private sector.

Apart from the issue of relevance, it also boils down to “who implements what”, remarked Robert Lim Joseph, president of the Network of Independent Travel and Allied Services Philippines.

Of over 6,000 properties in the Philippines, only about 700 have been audited for DoT’s new star rating. Of this, an undisclosed number have been downgraded and the ability of DoT’s star ratings to make or break a hotel remains a sore point for Philippine hoteliers.

Cebu-based Plantation Bay Resort & Spa, which enjoyed one of the highest occupancy rates in the Philippines for the last two decades, fell from grace when it was downgraded from five stars.

However, the downgrade came after the property had been elevated by TripAdvisor to its Hall of Fame for earning a certificate of excellence for five consecutive years.

The downgrade has “cast doubt upon the consistent ratings of Plantation Bay from reputable independent travel agency sites” and “strongly implies that existing Filipino hotels like Plantation Bay are lacking in quality”, stated the resort’s founder Emmanuel Gonzalez, who has filed corruption charges against the NTO and officials involved in the rating programme.

The Philippine Congress has initiated a hearing, with at least two congressmen calling to abolish the star rating system and to investigate alleged corruption involving the use of the US$7.1 million grant from the Canadian International Development Agency, which partially funded the star rating programme.

Questioning DoT’s role in rating hotels, Gonzalez wrote in documents to the authorities that “Ireland is the only country in the world where the national government issues star ratings and participation is compulsory. In Asia, “only in India is there a national government rating scheme and it is purely voluntary,” he added.

Gonzalez had in 2012 called the DoT’s attention to the “very subjective criteria and cumbersome checklist which would certainly lead to corruption”.

He added: “Hotel rating systems in Canada, Europe, the US and other jurisdictions simply list objective requirements, (but DoT’s criteria) are highly subjective.

“No hotel rating system anywhere in the world is given the authority to rate matters such as service, quality of food, condition of lobby furniture, and so forth,” Gonzalez elaborated.

Bill Barnett, managing director of C9 Hotelworks, said: “With the rise of TripAdvisor and OTAs, the rating system has become self-governing. In the case of reporting bodies, while government tourism bodies traditionally handled the certification and inspections, given the broad growth of tourism, the public sector has often turned to the private sector to assist as a manner of practicality.”

Barnett opined that hotel rating systems “over the past decades have become increasingly obsolete, and in many notable cases, international hotels do not participate. Many key segments like boutique hotels and luxury pool villa resorts are also not covered.

“At the end of the day, the travel sector in broad terms is seeing the rating system substantially diminish in terms of its authority and relevance,” he added.

Some industry players prefer their own hotel rating system. Said Marjorie Aquino, senior sales and marketing manager, Blue Horizons Travel & Tours: “We came up with our own star rating and our travel agents also have their own ratings. We do ocular inspection of hotels and we also consider travellers’ reviews of the hotels.”

On the other hand, Pedro Young, assistant vice president for business and product development at Uni-Orient Travel, favours the star rating system so travellers have an idea of hotel quality.

Young also believes that online reviews can be manipulated so “you have to be discerning whether the person making the review is sincere”.

Asked how to reconcile DoT’s star rating system with that of user-generated platforms like TripAdvisor, Jimenez said: “Through a star rating system, the travelling public can expect consistency in the standards of accommodation facilities and services throughout the country.

“TripAdvisor, on the other hand, is a more personal type of rating system. It is based on the client’s perception, influenced by their own experience of a particular service or facility. Although it is a good tool, this type of rating system can be biased and subjective, differing from one individual to another.”

Sarah Mathews, TripAdvisor’s head of destination marketing APAC, concurs that its bubble rating is completely different from the star ratings of local governments, and that they can complement but not substitute each other.

On its website, TripAdvisor distinguishes between the two, stating that its bubble rating is a summary of ratings from travellers displayed on a scale from one to five, where three is average and five is excellent. In contrast, a star rating is determined by a third party based on available facilities, staff and amenities.

Seasoned hotelier Arthur Lopez, president of Philippine Hotel Owners Association (PHOAI), also backed the star rating programme, citing the need for laws and regulation to protect consumers.

“When you say you’re five-star, you have to be five-star. We have no problems with international brands because they have their criteria. But have you been to provinces and checked three-star hotels? It is important for laymen to understand and to know what they are paying for when they book hotels online,” he said.

PHOAI has come up with solutions that the DoT has also agreed to during a meeting in October 2015. The minutes of that meeting prepared by the DoT noted that “PHOAI suggested the creation of an adjudication board that would consist of DoT and seven respected retired general managers not related to any existing hotels within the jurisdiction of DoT to address controversial issues.”

Additionally, they will choose a chairman among them who will report to the board. The seven will render their independent and expert opinions, as well as recommendations based on international standards and practices. The board will also convene to look at complaints and issues concerning the star rating programme and fine-tune the criteria.

At press time, it is not yet clear whether the DoT will implement the solutions agreed to with PHOAI.

If implemented, Lopez said that flexibility in the system will be important. For instance, some resorts deliberately omit Wi-Fi, TV and other electrical gadgets so that guests can unplug and unwind, yet deserving properties can still be classified as five-star despite lacking such amenities.

As well, new-generation five-star hotels such as Grand Hyatt may have expansive 40-45m2 rooms, but older properties with smaller rooms can still be classified as five-star if the other criteria are met.

Lopez also indicated that the board will attempt to include in the evaluation guest reviews and comments from OTAs.

How other SE Asian nations handle hotel ratings

According to a Singapore Tourism Board (STB) spokesman, there is no hotel star rating in Singapore as the sector comprises mostly international and regional brands that are well-known for their service level and range of facilities.

Visitors can also get a good sense of the quality of accommodation based on the range of room rates offered.

For planning and analysis purposes however, STB has developed a hotel tiering system to provide hoteliers, investors and other tourism stakeholders with information on the performance of each hotel tier so as to facilitate their business decisions.

This reference system categorises hotels based on several factors including average room rates, location and product type.

There are four tiers in this hotel tiering system, namely luxury, upscale, mid-tier and economy. – Paige Lee Pei Qi

Hotel rating in Indonesia is handled by the Tourism Business Certification Institutes, and divided into star (one to five) and non-star categories with certification valid for three years.

Johnnie Sugiarto, vice chairman of the Indonesia Hotel and Restaurant Association, said: “The classification is set by the tourism authority based on international and ASEAN standards. A traveller can expect to get a similar three-star hotel standard in Jakarta, Singapore or Australia, for example.”

Apart from the physical criteria to meet a certain star rating, staff qualification also plays an important part in the certification.

According to Johnnie, the regulation stipulates that a minimum of 30 per cent of the staff – from the management to the frontliners – hold professional certificates while manpower performance weighs 40 per cent of the total assessment points. – Mimi Hudoyo

The hotel star rating system in Malaysia is designed by the Ministry of Tourism and Culture Malaysia, and properties are rated every three years.

Ratings are based on six criteria, with points ranging from one to 10 in each criteria. A five-star hotel has to score a minimum of nine points for each criteria, while a four-star hotel will have to score a minimum of seven points. Three-star hotels have to score a minimum of five points for each criteria.

The six criteria are qualitative and aesthetic requirements, common areas, bedroom requirements, services, safety standards and hygiene, and staff.
Under qualitative and aesthetic requirements for instance, the property is checked on the use of space, colour schemes, design and ambiance, among others, while the staff criteria looks at qualification, language skills, staff facilities, etc. – S Puvaneswary

Hotel ratings in Thailand are set by the Thai Hotel Standard Foundation which administrates with support from other industry bodies, said Surapong Techaruvichit, vice president of the foundation and president of the Thai Hotels Association (THA).

Inspections are conducted by the Thai Hotel Standard Foundation in conjunction with THA, Association of Thai Travel Agents, Tourism Authority of Thailand, Ministry of Tourism & Sports, and representatives from universities.

Standards are fairly broad. One-star hotels are clean and basic while two-star hotels offers additional business services. Three-star properties see the consideration of style, comfort and services such as on-site dining, pools and conference rooms. Four-star hotels offer full amenities while five-star establishments stress luxury and high service standards. – Michael Mackey

This article was first published in TTG Asia, February 5, 2016 issue, on page 4. To read more, please view our digital edition or click here to subscribe.