Thai Hotels Shift Focus to Domestic Guests Amid Foreign Tourism Decline
As foreign tourist numbers drop, Koko Global Hospitality seeks to capitalize on the domestic travel market.
The Thai tourism sector is currently experiencing a slowdown in foreign visitor numbers, prompting local hospitality management firm Koko Global Hospitality (Thailand) Co Ltd (KGH) to target domestic travelers.
According to the company’s founder and CEO, Rei Matsuda, the hotel chain Kokotel aims to expand its portfolio by catering to the needs of Thai guests.
The overall environment in the tourism market is quieter than anticipated, particularly during this low season, although KGH is projecting to maintain a hotel occupancy rate of 75% nationwide and 80% in Bangkok through the year.
From January 1 to June 8, Thailand welcomed over 15 million foreign visitors, marking a 2.87% decrease compared to the same period last year.
Malaysia has emerged as the primary source market for tourists, while China has fallen to the second position.
Chinese visitors historically constitute approximately 15% of KGH's hotel guests, prompting the company to identify India and the Middle East as potential growth markets.
Matsuda noted that the firm does not depend on any single nationality for its business.
During this challenging period, the focus has shifted to improving operational efficiency.
He suggested that some Thai holidaymakers might pivot from international travel to domestic vacations, emulating a trend previously observed with Chinese tourists.
Currently, Thais represent 15-20% of the clientele at KGH properties, with certain destinations such as Chiang Rai, Hua Hin, Pattaya, and Chiang Mai witnessing a higher ratio of Thai guests.
The downturn in foreign arrivals has opened opportunities for KGH as independent hotel owners may seek management services.
Matsuda highlighted the three-star hotel segment as a particularly promising area for growth, despite a saturation of three-star accommodations in Bangkok.
Regions such as Phuket, Krabi, and Khao Lak in Phang Nga, however, continue to present viable opportunities for expansion.
As of May 31, KGH operates 41 hotels across Thailand, Japan, and the Philippines, directly managing 34 of these establishments while overseeing the pre-opening phase for 10 additional hotels and providing consultancy for seven others.
Collectively, these hotels comprise more than 2,500 rooms.
The company has set a target to manage 100 hotels by 2026.
Currently, 75% of its properties are in Thailand, 20% in the Philippines, and 5% in Japan.
Matsuda also noted promising prospects in the Philippines due to a similar market landscape, particularly in three-star hotels needing effective management.
KGH aims to expand its footprint to 1,000 hotels across 10 countries by 2035.
According to the company’s founder and CEO, Rei Matsuda, the hotel chain Kokotel aims to expand its portfolio by catering to the needs of Thai guests.
The overall environment in the tourism market is quieter than anticipated, particularly during this low season, although KGH is projecting to maintain a hotel occupancy rate of 75% nationwide and 80% in Bangkok through the year.
From January 1 to June 8, Thailand welcomed over 15 million foreign visitors, marking a 2.87% decrease compared to the same period last year.
Malaysia has emerged as the primary source market for tourists, while China has fallen to the second position.
Chinese visitors historically constitute approximately 15% of KGH's hotel guests, prompting the company to identify India and the Middle East as potential growth markets.
Matsuda noted that the firm does not depend on any single nationality for its business.
During this challenging period, the focus has shifted to improving operational efficiency.
He suggested that some Thai holidaymakers might pivot from international travel to domestic vacations, emulating a trend previously observed with Chinese tourists.
Currently, Thais represent 15-20% of the clientele at KGH properties, with certain destinations such as Chiang Rai, Hua Hin, Pattaya, and Chiang Mai witnessing a higher ratio of Thai guests.
The downturn in foreign arrivals has opened opportunities for KGH as independent hotel owners may seek management services.
Matsuda highlighted the three-star hotel segment as a particularly promising area for growth, despite a saturation of three-star accommodations in Bangkok.
Regions such as Phuket, Krabi, and Khao Lak in Phang Nga, however, continue to present viable opportunities for expansion.
As of May 31, KGH operates 41 hotels across Thailand, Japan, and the Philippines, directly managing 34 of these establishments while overseeing the pre-opening phase for 10 additional hotels and providing consultancy for seven others.
Collectively, these hotels comprise more than 2,500 rooms.
The company has set a target to manage 100 hotels by 2026.
Currently, 75% of its properties are in Thailand, 20% in the Philippines, and 5% in Japan.
Matsuda also noted promising prospects in the Philippines due to a similar market landscape, particularly in three-star hotels needing effective management.
KGH aims to expand its footprint to 1,000 hotels across 10 countries by 2035.
