Vietnam has been a popular tourist destination for budget-conscious travelers over the past decade. However, the country has managed to reshape its low-cost budget destination image to be a mid-range destination. Despite this, most travelers still plan their trips with relatively low hotel budgets. Nonetheless, the statistics today show an increase in average daily rates (ADR) and hotel budgets. Let’s dive deeper into the hotel budget of travelers going to Vietnam.
Low-Budget Travelers
Over 28% of travelers plan to pay below $100 per night when traveling to Vietnam. The low-end markets where most low-paying guests arrive are India, France, Italy, South Korea, and Russia. These budget travelers typically book via online travel agencies (OTAs) and travel agents and mostly come for vacation and business purposes. The median stay for budget travelers is 11 days, which is longer than the average.
Mid-Range Travelers
About 50% of inbound travelers to Vietnam are planning to book resorts between $100 and $300 a night, with an ADR of $176. They stay for nine nights and have a median hotel budget of $1,454. The top five countries in this segment are China, the United States, the United Kingdom, Australia, and Singapore. Most of these travelers are couples, booking via travel agents, OTAs, and 21% want to book direct. Most mid-range travelers are below 36 years old, with more guests over 36 to 65.
High-End Travelers
Vietnam has a small but strong high-end segment, with an ADR ranging between $300 and over $1,100 a night, with a median ADR of $389, a median hotel budget of $2,349, and a median length of stay of five nights. The highest-paying customers are over 38 years old, and most of them belong to the 50+ age group. The top five markets in this high-end segment are Germany, Spain, Japan, the United Arab Emirates, and the United Kingdom, with the United States having a slightly lower ADR compared to the UK.
Characteristics of Each Segment
Low-Budget Travelers
Most budget travelers are below 34 years old, and they typically book via OTAs and travel agents. They come to Vietnam for vacation and business purposes, and their median stay is 11 days, which is longer than the average. Budget travelers are more likely to come from India, France, Italy, South Korea, and Russia.
Mid-Range Travelers
The majority of mid-range travelers are below 36 years old, with more guests over 36 to 65. They are primarily couples, booking via travel agents, OTAs, and 21% want to book direct. Most mid-range travelers come from China, the United States, the United Kingdom, Australia, and Singapore. They stay for nine nights and have a median hotel budget of $1,454.
High-End Travelers
The highest-paying customers in Vietnam are over 38 years old, and most of them belong to the 50+ age group. The top five markets in this high-end segment are Germany, Spain, Japan, the United Arab Emirates, and the United Kingdom, with the United States having a slightly lower ADR compared to the UK. These travelers have a median hotel budget of $2,349 and a median length of stay of five nights.
Booking Channels
Another interesting point is that most travelers in all segments book via OTAs or travel agents. Only 21% of mid-range travelers want to book direct, indicating that hotels should prioritize their relationships with OTAs and travel agents.
However, some high-end travelers prefer to book directly with the hotel, especially those who have loyalty memberships with hotel chains. These travelers value personalized services and amenities, and they are willing to pay a premium for them.
Hotels should also consider offering incentives for direct bookings, such as discounts or complimentary services, to attract more direct bookings. By doing so, hotels can reduce their reliance on third-party booking channels and increase their profit margins.
Conclusion
Vietnam has managed to reshape its low-cost budget destination image to be a mid-range destination, attracting a diverse range of travelers. Budget travelers still make up a significant portion of inbound travelers, but the mid-range and high-end segments are growing. Hotels in Vietnam should focus on building relationships with OTAs and travel agents to attract more bookings. Additionally, hotels should cater to the specific needs of each segment to provide the best possible experience for their guests.
Overall, Vietnam’s hotel industry is on an upward trend, with increasing ADRs and hotel budgets. The country has become a sought-after destination for travelers from all walks of life, and the hotel industry is poised for growth in the coming years.