Are Thai five-star rates scary?

BANGKOK, 20 November 2019: Are Thai beach resorts pricing themselves out of the market?  One tour company boss, Stephan Roemer, thinks so according to a report by Skift an online travel news service that quoted heavily from Diethelm Travel Group’s hotel price data.

Roemer who owns Tourasia in Switzerland and heads Diethelm Travel Group as its CEO based in Bangkok claims rates at five-star resorts in Samui, Phangan and Samet are as high as USD500 a night including breakfast.

He told Skift that rates match resort properties of the same quality in  Greece, Spain and Italy, while resorts in Turkey and Egypt charge around USD350.  He even claims posh resort destinations in Switzerland, Germany and Switzerland are cheaper at USD450 a night.

His conclusions made headlines, and within hours Thai beach resorts earned a reputation for being as pricy as the best in Europe, a message quickly picked up by social media fans.

The part of the message that is undeniably true refers to the growing strength of the Thai baht.  As Roemer suggests, holiday prices have risen in dollar terms by 30% and based on the Euro by a steeper climb of 40%.

The Thai baht traded at 30.17 yesterday compared with 32.96 to the USD on 20 November 2018.

The headlines sound scary far more than the reality on the ground for the consumer booking a Thailand beach holiday in the five-star category. 

Diethelm Travel Group may have an inventory of hotel rates that are USDD500 plus for Thai resort properties in southern Thailand, but we don’t go to DTG to make our hotel bookings.

We checked out Booking.com ticking the boxes for five-star, beachfront, breakfast included on the island of Samui during mid-April, 2020.

There are 46 properties on the island that fit the booking criteria we ticked on Booking.com. Out of the top 15 hotel choices, six quoted rates between USD220 and 280.  Ritz Carlton caught our attention with a USD277 a night deal, while we thought the Banyan Tree at a whopping USD1,014 was way off the value scale. Out of the 46 options, there were plenty of properties quoting rates below USD200 and just a few pegging their best offers higher with Six Senses Samui quoting USD498.

When we checked out the Booking.com rates for similar beach resort experiences in Spain, rates were in the same band of USD200 to 280. Using the same dates and holiday criteria, Booking.com dished up 45 resorts in Turkey at the country’s favourite beach destinations, and the rates ranged from USD229 to 300.

It turns out to be a close shave when you compare top-of-the-line resort stays in Thailand and Europe. Rates are very close but not enough to conclude that Thai resorts are pricing themselves out of the market.

Thai hoteliers obviously should be cautious about making any further upward adjustments on rates. They are getting close to the edge on pricing reality.

Roemer may need to ask his contracting managers, either at DTG or Tourasia, if they grasped the USD500 rate for five-star Thai resorts from the cloud, but not the one where online travel agencies such as Booking.com reside. And thankfully, that is where consumers go when booking hotel rooms these days. We posted some questions to the DTG chief for clarity.

He replied: “Diethelm definitely does not have more expensive rates than what you can see in the market and what is offered via OTAs. Being professionals, we know how to compare correctly (which has to be an apple with apple comparison).”

He then quoted a rate of USD700 at Six Senses Samui when OTAs and leading tour operators we contacted confirmed without hesitation a USD498 rate at the five-star resort.

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