issue 2 march june 2014

FROM CHINA, WITH LOVE (AND CASH) / 01

EVENTS / 02
A DISAGREEMENT ABOUT THE DISAGREEMENT / 02
FLOATING ON A TOURISM FLOOD / 03
DATA BITES / 03
TO CATCH A PHRASE / 04
THE HIGH COST OF HIGH TECH / 06
MALAYSIA RISING / 07
HOME SWEET HOTEL / 08
SMALL WONDER / 09
HIRE EDUCATION / 11
ITS MORE FUN IN THE PHILIPPINES / 12
AMPED / BACK COVER
W NDER
SMALL
TRAVEL
TOURISM
HOSPITALITY
5
TOP
GROWTH
62.2%THAILAND
55%SOUTH
KOREA
48%NEW
ZEALAND
47.1%
TAIWAN
44.5%
MALDIVES
Excluding Hong Kong, Macau and Taiwan


6
9
%
OF TOTAL OUTBOUND
TRAVEL HEADING TO COUNTRIES
IN ASIA 2012
OUTBOUND
TRAVELLERS 2012
MILLION
83
FROM CHINA,
WITH LOVE (AND CASH)
THE CHINESE TRAVELLER IS REMAKING ASIA-PACIFIC TOURISM
Every year the growth in the number of Chinese tourists, and the amount they spend while away, astounds industry experts.
The emergence of a newly rich middle class, increased annual leave days, visa relaxation, worsening mainland pollution and
an overloaded domestic tourism infrastructure have sent Chinese tourists focking to destinations throughout the region.
QUO takes a look at the trends and statistics relating to Chinese outbound tourism across Asia-Pacifc.
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15M 7.9M 3.3M 2.8M 2.5M 2M 1.5M 1.4M 1.3M 626K 585K 335K 331K 215K 291K
CHINESE TRAVELLERS INTEND
TO INCREASE THEIR TRAVEL
BUDGET WITHIN THE NEXT YEAR
(CLSA)
1,230
PER
TRIP
AV E R A G E S P E N D
67%
$102
BILLION
SPENT
ON TRAVEL,
OVERTAKING
UNITED STATES
AND GERMANY
FOR THE TOP SPOT
IN 2012
UN 2012
GLOBAL RANKING:
CHINESE VISITORS
01 STATUS QUO#2
v
A DISAGREEMENT ABOUT
THE DISAGREEMENT
EVENTS
JUST HOW MUCH IS THE TRAVEL INDUSTRY BEING AFFECTED
BY THE CURRENT POLITICAL UNREST IN THAILAND?
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2
0
1
4
1 March
India Opening
Le Mridien
Gandhinagar
5 9 March
Industry Event
ITB Berlin
9 11 March
Industry Event
Routes Asia,
Sarawak, Malaysia
13 16 March
Industry Event
Hospitality 360,
Singapore
17 18 March
Industry Event
Social Media and
Mobile Strategies
for Travel,
San Francisco
17 19 March
Industry Event
Young Hoteliers
Summit, Switzerland
17 21 March
Global Design
Design Days Dubai
18 19 March
Industry Event
Hotel Investment
Conference,
Asia-Pacifc HICAP,
Singapore
30 March 4 April
Global Design
Light + Building,
Frankfurt
April
Thailand Opening
dusitD2 Phuket
Resort
1 2 April
Industry Event
Travel Distribution
Summit Asia,
Singapore
2 3 April
Industry Event
Hotel Investment
Conference South
Asia, Mumbai
4 6 April
Industry Event
Hotelier Summit
India, Kerala
8 11 April
Industry Event
Hotel Asia 2014,
Singapore
8 13 April
Global Design
Milan Furniture Fair
24 25 April
Industry Event
World Travel and
Tourism Council
14th Annual
Global Summit,
Hainan Province,
China
May
Singapore Opening
Softel So Singapore
1 May
India Opening
Le Mridien
Mahabaleshwar
Resort and Spa
14 16 May
Global Design
Hospitality Design
Expo 2014, Las Vegas
17 20 May
Global Design
International
Contemporary
Furniture Fair,
New York
20 21 May
Industry Event
Asia-Pacifc
Hotel Investment
Conference, Bangkok
20 22 May
Global Design
Clerkenwell Design
Week, London
28 May 1 June
Global Design
DMY International
Design Festival,
Berlin
June
Indonesia Opening
Sea Sentosa Bali
1 June
Thailand Opening
Le Mridien
Suvarnabhumi Golf
Resort and Spa
2 5 June
Industry Event
ILTM Asia, Shanghai

30 June
Indonesia Opening
The Sarasvati,
a Luxury Collection
Resort, Bali
10 12 July
Industry Event
India Hotel Show,
Hyderabad
Summer
Indonesia Opening
Ritz-Carlton Bali
10 12 September
Industry Event
The Global Spa and
Wellness Summit,
Marrakech
18 20 September
Industry Event
World Spa
and Wellbeing
Convention,
Bangkok
1 3 October
Industry Event
World Festival of
Interiors, Singapore
5 7 November
Industry Event
Hotel Interior
Design: The Decision
Makers Forum,
Borneo, Malaysia
Late 2014
Indonesia Opening
Raffes Jakarta
Late 2014
Singapore Opening
Patina, Capitol
Singapore
here are contradictory reports about how much of an effect Bangkoks
protests are having on the countrys hospitality and tourism industry,
one of the fastest growing service sectors in the world.

Tourist numbers for the second half of 2014 are hard to predict. Some
top inbound tour operators remain positive and confrm a steady market.
Diethelm Travel, Intrepid Travel, G Adventures and Destination Asia have
all voiced positive outlooks, saying that they expect growth in 2014 and
are going full steam ahead with their focus on new markets and itineraries
that include Thailand.

The number of cancellations is very low because the majority of our
guests are coming from mature markets or places like South America and
South Africa where they are used to some sort of disruption in daily life
and most of these bookings were made late last year, says Hans van den
Born, Managing Director, Diethelm Travel.

The overall situation remains positive and Buffalo Tours have had a good
start to 2014, agrees Kenneth Joergensen, Thailand Country Manager
for Buffalo Tours. The immediate effects have been our need to keep
our travellers and partners updated about a rather unpredictable situation.
However, over the years, travellers have proven rather resilient towards
such political situations.
But differing perspectives are coming from hotels within Bangkok and
from other tour operators. Bert van Walbeek, chairman of the Thai
chapter of the Pacifc Asia Travel Association, told CNN there are likely
to be 60-70% fewer Chinese tourists coming to Thailand for the Year
of the Horse. In addition, the Bangkok Post reports that the protests
have already had a massive effect on the MICE industry, with research
companies predicting a loss of revenue well into the millions.

The fate of international events that were to be held in Thailand during
the third and fourth quarters is uncertain. Id like to suggest the government
revoke the emergency decree as soon as possible to keep the projection
on track, said Nopparat Maythaveekulchai, president of the Thailand
Convention and Exhibition Bureau.
If the protests end in the near future and countries lift their travel warnings,
there is hope that Thailand has time to make up for its losses. But as
the fow of inbound visitors on itineraries booked last year slows to
a trickle, there is widespread fear that competing properties and tour
operators will be forced to slash prices in a ferce contest for these
post-protest travellers.
T

v
DATA
BITES
.Luxury
7%
45% 40%
65%
68%
80%
$800
of hoteliers report guests
taking batteries from
the remotes
of hoteliers report
guests taking towels
from hotel rooms
of British travellers expect
free in-room Wi-Fi
New top level
domain, .LUXURY
These new travellers
dont need tons of
handholding, they shun
human interaction, and
they know their way
around. We reckon
theyve got a point.
2014 TREND: SILENT TRAVELLERS
BOOKING RESORTS ON MOBILE
PHOTOS SHARED PER DAY
of millionaires are self-
made and were raised
with little or no exposure
to luxury
of hotel guests travelled
with 2 devices.
of hotel guests travelled
with 3 or more devices.
of same-day hotel reservations
are made from a smartphone
Mobile visits grew across our network
of sites by 71% (November 2012 vs 2013).
Largest growth was in iPhones (82%)
Roaming bill racked-up
by a Hajj pilgrim on his
journey to Mecca

NOVEMBER
2012 VS 2013
source: QUO
source: TripAdvisor TripBarometer Truth in
Travel survey
source: eRevMax Top 5 Trends in
Hotel Technology
source: American Affuence
Research Center
source: ben-evans.com
source: Bangkok Post
source: skift.com
WHATSAPP
FACEBOOK
SNAPCHAT
INSTAGRAM
400M
55M
350M
350M
FLOATING ON
A TOURISM
FLOOD
he World Bank confrms that tourist numbers to
Myanmar are on a ferce increase, refecting the
growth in tours and itineraries, new domestic airlines
and routes, and increased international fights. Myanmars
Tourism Master Plan aims for their number of tourist
arrivals to increase almost threefold to 3 million by 2015.
But despite the growth of industry services, the country
is struggling to keep up with demand. As more and more
travellers enter the country, the demand for international
branded hotels has also surged. Big hotel groups such as
Shangri-La, Hilton, Best Western, Orient-Hotels and Accor
already have their fngers in the Burmese pie, and other
big names are on their way; however, the need for rooms
is now, and there simply arent enough.
Enter the river cruise. Its old news that river cruises are
gliding at an impressive rate and showing no signs of
easing off the gas for 2014. In addition to the attraction
of combining touring and accommodation, a boat can
usually be launched quicker than a new-build hotel. So
with their sights frmly on new markets, cruise operators
look to Myanmar as the perfect place to ensure company
profts and expansion. According to Travel Weekly, Haimatk
Ltd, Pandaw River Expeditions, Sanctuary Retreats and
AmaWaterways are all launching new boats this year.
There is an acute lack of hotel space right now in Myanmar,
which makes things diffcult for any tour operator in respect
to travel logistics and expansion plans, says Kristin Karst,
Executive Vice President of AmaWaterways. Thats one
of the greatest benefits of seeing Myanmar on a river
cruise. The ship is basically a foating hotel, so you never
have to worry about not being able to get a reservation.
That is, until all the boats fll up too.
WITH THE TOURISM BOOM IN MYANMAR REACHING NEW PEAKS,
SAVVY ENTREPRENEURS ARE PROVIDING ALTERNATIVES
TO OVERFLOWING HOTELS.
02-03 STATUS QUO#2
T

25%
1.3
MILLION
B
A
H
T
Gods Own Country Kerala The gold standard. It sounds like heaven on earth.
Amazing Heritage.
Grand Experience
Uttar Pradesh A nice tempo that makes the place sounds like a rich experience.
Simply Heaven! Uttarakhand Simple and heavenly. It even gets away with its use of the exclamation mark.
Gateway to Serenity Arunachal And who couldnt use a little serenity? A delightful phrase.
Give Time a Break Pondicherry An antidote to our busy lives. Magical.
You Have Reached Your
Perfect Destination
Andaman & Nicobar Superlatives often feel superfcial, but this bold second-person
present-tense statement feels authentic.
The Land of Natural Beauty Dadra & Nagar Haveli Conjuring visions of gorgeous forested mountains full of rare wildlife.
Bad
Unforgettable Himachal Himachal Pradesh A forgettable slogan, overused worldwide.
Full of Surprises Chhattisgarh Is the subtext that well be surprised Chhattisgarh is not as bad as expected?
One State. Many Worlds. Karnataka It doesnt create an image in the mind, or promise a positive experience.
Beautiful Bengal West Bengal Alliteration: the lazy writers tagline technique.
Enchanting Tamilnadu Tamilnadu Enchanting sounds like a word won from thesaurus roulette.
A New Experience Jharkhand Is that because nobody who has gone wants to go back? New experiences arent always good ones.
India Begins Here Punjab Maybe they have an airport to land in before exploring the nicer parts of the country?
Ugly
Go, Goa: A Perfect
Holiday Destination
Goa Go-go brings to mind scantily dressed dancers and a cartoon cyborg detective. A hollow promise.
A Pioneer in Highway Tourism Haryana Why go to the pristine beach or the majestic mountains when you could go see a highway?
The Incredible State of !ndia Rajastan Can a national tourism board sue a member state for plagiarism?
The Soul of Incredible !ndia Odisha A bad way of distinguishing yourself from other destinations: use their slogan technique.
The Heart of Incredible India Madhya Pradesh Were noticing a pattern
Mesmerizing Meghalaya Meghalaya Cheap alliteration and weird word choice makes this sound like a stage magicians moniker.
Everything is Possible Andhra Pradesh Including the possibility of going on vacation in Gods Own Country instead of Andhra Pradesh.
THE GOOD, THE BAD AND THE UGLY
OF DESTINATION SLOGANS IN INDIA.
TO CATCH
A PHRASE
ts a near impossible task. You only have a few words to
communicate to tourists why they should consider coming to
your city, province or nation to spend their meagre allotment
of vacation days and, more importantly, their hard-earned hard
currency. The carefully curated vocabulary of a destination tagline
is expected to communicate the essence of the places history,
culture and people. In order to succeed, it needs to stick in the
readers memory, and not for all the wrong reasons.
Given the high stakes, its no wonder that many tourism authorities
seem to rework their catchphrase every few years, hoping a sparkly
new slogan will reignite fnicky travellers interest. In recent years,
it was decided Uniquely Singapore wasnt unique enough, so it
transformed into the apparently more unique YourSingapore. And
Jamaica stirred things up when the cryptic Once you go, you know
was changed to the arguably more cryptic Get all right, which may
bring to mind images of dreadlocked dope dealers selling spliffs
instead of luxurious resorts on sandy beaches.
While these long-popular destinations continue to search for just
the right words, many developing nations are taking their very frst
swings at branding. In Incredible !ndia, states big and small are
ramping up their promotion efforts, hoping to fnd the success
enjoyed by Kerala, when it branded itself as Gods Own Country
a decade ago. In addition to attracting outside attention, many
are focused on developing domestic tourism, which accounted
for 851 million tourists in 2011, as opposed to 19.5 million foreign
visitors, according to the tourism ministry. Despite exponentially
growing marketing budgets and the assistance of ad agencies,
the results are, err, mixed.
TAGLINE STATE VERDICT
Good
04-05 STATUS QUO#2
If your brand were a song,
would people hum along?
BRAND STRATEGY | CREATIVE | DIGITAL | MEDIA PLANNING | COMMUNICATIONS | SERVICES | QUO ADVOCACY
QUO brings ideas to life. We forge innovative brands for global clients
from hospitality giants to boutique concepts, from spectacular design
to the simplest forms, from new brands to rebrands.
www.quo-global.com
AND EVEN HIGHER COST OF UNDERWHELMING YOUR GUESTS WITH DATED TECHNOLOGY.
hecking into a hotel, the staff on
the desk informed me that the
minibar was pressure-sensitive,
so if you took something out and then put it
back, youd still be charged. I couldnt help but
wonder why the minibar was smart enough to know
when I had taken a beer, but not clever enough to
forgive me after my moment of weakness. I nodded in
acknowledgment, thanked him politely and then shuffed
off to my room, pondering the changes in technology and
human behaviour, and how they affect the bottom line.
Hoteliers face the dual challenge of evolving technology and
the rapid change in customers demands. STR Global estimated
that in 2013 there were 17.5 million hotel rooms around the world.
On this scale, even small changes in guests technology expectations
can have a huge impact on the bottom line; hoteliers need to strike
the delicate balance between giving guests what they want, at a price
the hotel can afford.
Wi-Fi is a prime example. For a long time, guests would complain
profusely when, after spending $250 on a hotel room, they had to
spend another $20 for Wi-Fi. The added expense could result in
a true failure in terms of how a hotel (and a brand) is perceived.
Hoteliers were wary, frstly, of losing a new revenue stream,
and secondly, of spending money on a robust Wi-Fi
network. Guests have become used to having a free
router with Wi-Fi at home, and because of this, they
think that Wi-Fi is cheap and easy. However, at a
larger scale it is not: a decent network will start at
$10,000 for a 200-room property. Nonetheless,
fast, reliable Wi-Fi is a top requirement for
todays travellers; just look at the Wi-Fi
related comments on TripAdvisor. It
is one highly visible indicator of the
technology changes that are taking
place in the hospitality industry.
This demand for Wi-Fi has
been driven in large part
by the new generation
of cheap, powerful
phones and tablets
that people carry
everywhere.
Having
become
so
addicted to these devices, people (me included) expect fast Internet
wherever they are, especially when they travel overseas and want to avoid
the often exorbitant roaming charges for data. There is an expectation that
hotels will be oases of connectivity. On the plus side for hotels, nowadays
there is little need to buy (and maintain) desktop computers for guests to
use: at one time it looked like hotels would have to fork out massively on
providing this hardware, especially for business travellers looking to travel
light. But the demand has vanished at the same rate as mobile devices
have caught on.
Recent years have been tough for hoteliers with other expensive upgrades
and updates needed to keep up with demand and remain competitive.
The most visible example is the large, fat widescreen TV that replaced
the old CRTs. Guests do not want to spend the night with a TV that looks
like a giant goldfsh bowl, a relic of a past era. And top hotels, no matter
how moderately priced, want to provide guests with an atmosphere as
comforting as their home, only better. Plus, LCDs have other benefts:
being slim, they take up less space, making the room feel larger; and
the energy consumption on average is less than a third of a CRT. When
multiplied by a hundred or so rooms, that adds up to a tidy saving.
Unfortunately, other changes havent had such obvious silver linings.
The iPhone revolution saw hotels putting in docks and connectors
specifcally for Apple devices: the 30-pin connector used to connect and
charge iPhones, iPads and iPods had been around since 2003 and had
become ubiquitous. But Apple, always capricious, changed the connector
size and shape in 2012, instantly making the old docks and connectors
obsolete. Now, the old docks serve as an indicator, perhaps unfairly, that
the hotel is out of date.
Beyond these examples of guest-facing technology, there are equally huge
changes taking place behind the scenes especially in the core software
used in day-to-day business. Some newer hotels are skipping the legacy
Property Management Systems (PMS) in favour of cloud-based services.
Cloud PMS built on Internet standard technologies has the beneft of
being available across a wide variety of devices, which allows for things
like check-in via tablet. And they have fewer initial costs (a monthly fee
negotiated on a multiyear deal). Now that the Internet is a commodity to
be expected, like electricity and water, implementation is far easier than
in the days of yore.
But PMS still have many advantages, not least of which is the deep
pool of hospitality talent that are familiar with the systems. A steep
leaning curve can be a costly mountain to climb. Plus, cloud PMS are still
evolving rapidly, and nobody wants to be on the wrong chair when the
music slows down. There is both an opportunity (new features and more
fexibility) and a risk (no clear winner has emerged, so the chance of fnding
suitable staff with experience in a particular CMS may be tricky).
As if the hospitality business didnt have enough risks to negotiate,
the exponential acceleration of technology is quickly rising to the top of
the heap of hazards. With both hardware and software evolving at light
speed, fnding the sweet spot between lagging at the back of the pack
and decapitating yourself on the cutting-edge requires staying abreast of
all the latest developments. Perhaps what we need next is a hospitality
robot sensitive to all the pressures of giving guests a high-tech experience
without breaking the bank.
THE HIGH COST
OF HIGH TECH
Anthony Green
Digital Director
Greg Lowe
Managing Director,
Watchman Agency
MALAYSIA
RISING
T
THE GROWTH OF THE TOURISM SECTOR IN MALAYSIA
HAS BEEN IMMENSE. BUT ARE THE TRENDS PART OF THE
LARGER REGIONAL GROWTH, OR DO THEY REFLECT A UNIQUE
POSITIONING THAT WILL SEE THE COUNTRY BREAK AWAY FROM
THE PACK? WE LOOK TO THE NUMBERS FOR GUIDANCE.
ourism has played an increasingly
important role in Malaysias
economy since 1990, when the
national tourism organisation launched
its frst Visit Malaysia Year promotion.
This was the catalyst that saw international
arrivals rise from 4.8m in 1989 to 7.4m in
1990 and up to 25m in 2012. According
to Tourism Malaysia fgures, 26.8m arrivals
were estimated for last year. And with
the increase in arrivals, visitor spending
has ballooned, almost quadrupling since
the dawn of the new millennium, rising
from 18.8bn ringgits (US$5.7bn at current
value) in 2000 to 62.6bn ringgits in 2012.
Taking a closer look at the contributions
travel and tourism make to Southeast
Asias third largest economy sheds further
light on how this dynamic industry will
continue to be a key driver of growth and
investment in Malaysia, especially as the
government is targeting visitor arrivals to
reach 36m with 168bn ringgits spending
by 2020.
The World Travel & Tourism Council fgures
show that the industry directly contributed
65.3bn ringgits in 2012, or 7 per cent
of gross domestic product, which was
forecast to rise 6.1 per cent last year
and by an additional 5 per cent per
annum from this year until 2023. When
taking multipliers into account, indirect
contributions were an impressive
146.4bn ringgits in 2012, 15.6 per cent
of the economy.
Travel and tourism indirectly employed
1.8m people last year, forecasted to rise
to 2.5m in 2023; around one in seven
people in Malaysia, according to the
council. The sector accounts for 7.7 per
cent of visitor exports and about the
same proportion of investment, with the
latter set to top 9 per cent within the next
nine years.
Most major hotel brands are operating in
Malaysia, with a number regularly winning
major travel awards, such as Hilton Kuala
Lumpur, Mandarin Oriental Kuala Lumpur,
Le Mridien Kota Kinabalu and Four
Seasons Resort Langkawi. The country
has few recognisable home-grown
international tourism brands, save for
Robert Kuoks powerhouse Shangri-La
Hotels and Resorts, Malaysias most
recognisable and successful international
chain. It does boast some classic domestic
hoteliers, however, such as Eastern &
Oriental. YTL Hotels is a high-end
ownership and management company
with an increasing international reach.
Tune Hotels is entering the regional value
accommodation space, while Cititel Hotel
Management is making furtive steps into
the US, UK, Philippines and Myanmar.
Malaysias geographic size and diversity
means there will be increasing investment
opportunities as new destinations are
developed beyond Kuala Lumpurs
already overcrowded accommodation
sector. Such opportunities will be
dependent on infrastructure development.
Fortunately, the government has already
fully integrated such plans into its
national agenda.
Khazanah Nasional, the governments
investment arm, is developing new
attractions and resort areas through two
of its subsidiaries, Themed Attractions
and Resorts (TAR) and Destination Resorts
& Hotels (DRH). TAR (www.tar.com.my)
has been behind the development of key
attractions across the country including
LEGOLAND Malaysia, Puteri Harbour
Family Theme Park and KidZania Kuala
Lumpur, all of which are open, as well
as Ocean Splash Water Park and Ocean
Quest Marine Park (which are due to
open in 2016) and the Malaysia Truly
Asia Attraction.
Meanwhile, DRH has been
busy diversifying the countrys
hospitality industry with its notable
achievements including Desaru
Coast, the frst integrated resort
on the southeastern coastline,
Teluk Datai on Langkawi and
Puteri Harbour in the Iskandar
development zone, where Traders
Hotel is located. However, private
sector involvement is essential in
making these projects a success.
To date, major investment partners
include Amanresorts, Sheraton
Hotels & Resorts, Shangri-La
Hotels & Resorts, Ernie Els
Design, Archipelago Hotels
& Resorts, Troon Golf and
The Datai Langkawi.
Key infrastructure developments
and market trends will
undoubtedly continue to
create lucrative investment
opportunities for years to
come, especially given that
tourism arrivals are set togrow
by more than 25 per cent
by 2020.
This development will
certainly follow a regional
trend in which China will play
a decisive role some 100m
travel-hungry mainlanders
will be opting for outbound
holidays by the end of next
year and Southeast Asia is
their no.1 destination.
The challenge for
Malaysia will be to lead
rather than follow the
trend. Establishing
stronger regional and
domestic hospitality
brands will be vital if the
country is to meet this
signifcant challenge.
Bill Barnett
Managing Director,
C9 Hotelworks
RESIDENTIAL PROPERTIES
TAGGED WITH HOTEL BRAND
NAMES CONTINUE TO GROW
AND EVOLVE AS THE TOP-END
MARKET SHIFTS FROM THE
BEACH TO THE BIG CITY.
HOME
SWEET
HOTEL
ne of my recurring nightmares
is set on a tropical island at
sunset. A burnt orange ball
sinks behind an erotically charged
image of a scantily clad swimsuit
model gently grasping onto the side
of a mega-villa infnity swimming pool.
She stares aimlessly onto an empty
horizon. But then, the golden moment
suddenly takes a dark twist when
a giant reptilian tail appears out of
nowhere and breaks the tranquillity
with a cacophony of gushing water
sounds. The lovely girl disappears in
a furry of bubbles. Like a monster
straight out of the Black Lagoon, the
half-man, half-reptile creature preys
on those who dare going solo in their
waterfront cliffhanging mansions.
Welcome to my Great Recession
nightmare. It doesnt take Freud
to make the link between the
disappearing pool girl and the real
estate investor who once embraced
the hotel-branded pool villa craze
in Asia.
Two icons helmed the golden age of
the branded residences movement:
Amans Adrian Zecha and K. P. Ho of
Banyan Tree. These two propelled the
entire leisure experience away from
rented box and into your very own
private space. The promise of being
able to go to paradise, get naked,
swim, and then stay naked for the rest
of the day was a sexier stimulant for the
rich than Viagra. Before the Big
Sleep of 2007, hotel-branded
resort villas few off the shelves
across Asias leading resort
destinations: Phuket, Bali,
Koh Samui, Vietnam
and even Cambodia.
Brandologists and
property hucksters could
quote the doctrine
with the conviction
of a Jehovahs
Witnesses pitching
the imminence of the apocalypse.
The doctrine was based on the assured
value-add of internationally recognised
brands to real estate offerings: premium
pricing, an amped up sales pace and
that intangible of tangibles prestige.
But then the crystal-clear wisdom of
investing in a brand-name villa became
muddied by the pond scum of Bernie
Madoff and unscrupulous derivatives
traders, who sank the economy and
killed the pool party. The multimillion-
dollar hotel-branded leisure residence
segment came crashing down and
has yet to fully re-emerge. While such
projects once boasted a few sales
each month, today the trading remains
sluggish, with even developments in
leading markets like Phuket and Bali
taking four to fve months to sell just
one villa.
So Asias developers took to a new
tactic: going low or high and staying
out of the meaty middle entirely. These
extremes put pressures on size and
price. The market ended up with many
smallish investment types who were more
suitable for a meagre vegan appetite
than the ravenous carnivores developers
once adored. Domestic buyers replaced
the elite international crowd,
and the rise of the Asian middle
class created a new East, where
the West once lived. It was
Paradise Lost.
But the smart large
property developers
followed the money
trail away from
the beach and into
town. Investment in
urban property was still
booming, even while the rest of the
global market went bust then stagnant.
Suddenly, hotel brands clamoured
for urban offerings. As investment
became a more domestic affair,
the big brands and developers in
Asian cities began to catch more and
more rich locals and an increasing
aspirational class who loved city-
centre living, with its upscale retail
malls, fancy eateries and cultural
offerings. What better way to
showcase a large mixed-use real
estate offering than leading with
a prestigious hotel brand to elevate
the entire lifestyle complex?
Branding has defnitively gone to
town. In every CBD across Asia,
international hotel brands and
celebrity designers have entered
into the high-stakes name game,
launching a massive number of new
offerings. Where and when the
saturation point comes is anyones
guess, but taking a look at the
Philippines where a Paris Hilton
affliated residential resort project
has prospered might signal that the
air is getting pretty thin. At the same
time, the familiar resort destinations
in the region are again leaping into
the deep end with new high-end
hotel-branded pool villas. Whether
or not they can rise from the depths,
avoiding the leviathans that wreck
my dream time, is anybodys guess.

Bill Barnett is the Founder and
Managing Director of hospitality and
property consulting frm C9 Hotelworks
(c9hotelworks.com). He
is considered a leading
expert in hotel-branded
residences across
Asian markets.
08-09 STATUS QUO#2
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CAN INTERNATIONAL BRANDS EXPAND
INTO AN INDONESIAN MARKET DOMINATED
BY LOCAL LOW-COST CHAINS? AND CAN THESE
BUDGET HOTELS EXPAND INTO AN INTERNATIONAL
MARKET DOMINATED BY THE MAJOR PLAYERS?
Greg Lowe
Managing Director,
Watchman Agency
ndonesias value hotel sector
is booming thanks to the
increasing number of locals
travelling for business and
pleasure. This has seen what is
perhaps a unique trend emerge
the rampant expansion of
branded home-grown chains
which are demonstrating
that limited service does not
mean limited imagination,
and that by combining cultural know-
how with quality design and friendly
service, more affordable properties can
punch above their weight and compete
with established international brands.

The republics geography, diversity
and demographics have also been
key drivers of the explosion of limited-
service properties, in an overall market
which saw the number of new hotels
rooms added per year rise from 15,000
to more than 50,000 in 2013, according
to the Indonesian Hotel and Restaurant
Association. In Jakarta alone, budget
hotels are expected to account for half
of the 4,000 new rooms forecast to
come online from 2013-14, according
to research by realtor Cushman
& Wakefeld.
Locally developed chains dominate
the market, though a few regional
and international players are able
to go toe-to-toe with domestic
brands. The markets development
provides an indisputably powerful
case study for the hospitality industry
on both a regional and international
level, according to hoteliers and
related experts. Questions remain,
however, over what, if anything,
makes Indonesias story unique and
whether the phenomenon will be
replicated elsewhere.
Bill Barnett, Managing Director of
C9 Hotelworks, a regional hotel
and hospitality industry consultancy,
says scale is playing a vital role in
the segments success story.

Theres so much scale in Indonesia in
terms of geography and cash, he says.

Theres plenty of liquidity in Southeast
Asias largest economy. These properties
cost about $30,000 to $40,000
per room to build. That level of
investment has enabled a lot of local
entrepreneurs to enter the market.
There are a lot of people about with
the $2-3m [investment] needed per
property. Nearly every Indonesian
developer has a [budget hotel] chain
these days.
A quick look at some top-line fgures
adds weight to Barnetts argument.
Indonesia is the worlds largest
archipelago, with more than 17,500
islands, and home to a growing
population of 250m-plus people. This
geography makes travel a regular part
of many Indonesian jobs. Given the
average income per capita was around
$3,500 in 2012, according to the World
Bank, accommodation needs to be
affordable to meet the budgets of most
local business and leisure travellers.
Furthermore, the countrys domestic
tourism and business travel markets
dwarf the inbound trade. Indonesia
received 8.8m international visitors last
year, up 9.4 per cent on the previous
year and higher than the Ministry of
Tourism and Creative Economys target of
8.6m, with the popular island destination
of Bali accounting for 3.2m. While
exhibiting healthy growth, this fgure
pales into insignifcance when compared
with the staggering 250m domestic trips
made a year. Added to this is the fact
that Indonesians tend to be value-driven
when it comes to spending, with both
well-off travellers and more budget-
conscious individuals happy to stay
at well-designed limited-service hotels.
The key drivers of hospitality in
Indonesia are its strong economic and
demographic fundamentals, says
Marc Steinmeyer, president director
of Tauzia Hotel Management, which
owns and operates the Harris, Yello
and Pop! brands.
The country boasts a very young
population 50 to 60 per cent is under
29 years old. It has a large network
of secondary cities that are rapidly
developing and, most importantly,
Indonesia is an enormous country that
is roughly the size of the United States
from East to West.
Norbert Vas, Vice President of
Sales & Marketing at Archipelago
International, which manages
favehotels a chain currently making
its foray into the Malaysian market
and NEO, both budget brands,
supports Steinmeyers perspective.

Domestic demand, the proliferation of
budget [airline] carriers, growing middle
classes and decentralisation have been,
and continue to be, the key driving
factors, he said. Our frst select-service
brand favehotels, which now operates
27 hotels in the country and has another
43 under construction, was born over
a round of lattes at Starbucks in one of
Jakartas primary up-market malls. We
simply observed how over the years mall
traffc had increased, customers became
younger and more affuent and mall
offerings more and more international.

Our second budget brand, Hotel
NEO, which currently operates seven
hotels and has another 18 under
development is more niche orientated.
As a non-smoking designer brand
it targets a younger, more fashion-
conscious audience.

Despite strong supply- and demand-side
drivers, international involvement
in the market has been relatively limited.
Accor pioneered the Indonesian budget
market with the local launch of its
ibis brand in 1994. It was followed by
Swissbel in a joint venture with Ciputra
in 1995 and Aston in 1998, said
Steinmeyer, who formed Tauzia in 2002.
In 2002, Indonesia was completely
ignored by investors and all international
hotel management brands with the
exception of Accor, he said.

Accor continues to be a serious contender in

Indonesia, and ibis now boasts 29 properties
across the archipelago and Januarys launch of ibis
Surabaya Basuki Rahm marked the opening of the
brands 1,000th property.
Tune Hotels, a joint venture between AirAsia and
Red Planet Hotels, currently has eight properties
in Indonesia including two on Bali and will open its
ninth in Surabaya in March. Domestic demand and
local airlift has been a key factor for Tune since it
entered the local market in 2009.
Red Planet Hotels CEO, Tim Hansing, says 2010-11
marked a turning point as a number of local
branded chains emerged in a market that was
previously comprised mainly of independent
properties. This catalysed the sector in terms
of driving growth and raising standards, making
it a competitive interest for the operator.
Indonesia will be a signifcant part of our story,
so much so we are in the midst of establishing
a standalone company there to manage the
business for us and when this becomes offcial
we will unveil our long-term business plan there,
he says.
In our Southeast Asian properties we fnd around
65 per cent of our business is domestic travellers...
We are fnding that Indonesians who stay in a Tune
hotel in Indonesia are now looking to the brand
as their frst choice when they travel outside the
country to a city where we have a hotel.
Domestic chains have also succeeded by drawing
on their local expertise and by tapping certain
niches. Some properties have enhanced their
design to ensure suffcient space for guests to
pray, an important requirement in the worlds
most populous Muslim nation. Meanwhile, NEO
is targeting hipsters, and Harris (a mid-scale
brand) focuses on friendly service as its unique
selling point.
While theres a consensus within the industry that
Indonesias value sector is a success story, the jury
is out as to whether the model can be replicated.
Barnett says Indonesias case remains largely
unknown despite the powerful lessons other
industry players could learn from its development.
Its a great story and it should be replicated,
he says, but there are domestic factors such as
Indonesias geography and domestic demand that
cant be found in other markets such as Thailand
or the Philippines. So the ability to repeat it
successfully elsewhere could be limited.
While these aforementioned issues could affect
the replication of Indonesias budget hotel
model across the region, they will not prevent
local operators from attempting to export their
brands and know-how, according to Steinmeyer,
who remains enthusiastic about the industrys
expansion plans.
We want to promote Indonesia outside the
archipelago and with its neighbours. Indonesians
are travelling more and more and the Asean
market will be consolidating over the next
few years, he says.

This is an opportune moment to expand regionally.

Greg Lowe is a Bangkok-based British journalist
and author, who writes about a range of issues
from business and politics to literature and travel.
He is the Thailand correspondent for TTG Asia,
the regions major travel-trade publisher.
Indonesia hopes to be the head
of the class in hospitality schools,
raising the bar on employee talent
throughout Southeast Asia.
Indonesia is planning to spearhead
the development of the travel-
trades skills across Southeast Asia
by strengthening its tourism schools
in preparation for the inauguration
of the Asean Economic Community,
which is currently tabled for the end
of next year.
Speaking at the Global Tourism
Economy Forum in Macau last
September, Indonesias Minister for
Tourism and Creative Economy, Mari
Elka Pangestu, said the groupings
10 member states must work harder
to upgrade their human capital to
beneft from surging global tourism
numbers. This is not just about
language capacity, she said. Asean
has identifed 32 hospitality industry
categories. We need to make
improvements in all of them.
With its combined population
of more than 600 million people,
Asean has a signifcant pool of
talent and other resources to
draw on in order to strengthen
its tourism industry. If all goes
according to plan, the AEC will
allow for the free movement of
labour between member states.
This will create localised
opportunities and challenges for
each country with the association.
For example, Thailands hospitality
industry is well known for its
friendly service; however, English
and other foreign language skills
leave a lot to be desired. Singapore
runs sharp and effcient hotels
but often lacks the human touch.
While the Philippines, as home to
the worlds sixth largest English-
speaking population, is well
placed to pick up the slack on
the communications front.
Collaboration will be all the more
important given surging global
international arrivals fgures, which
the United Nations World Tourism
Organisation forecasts will reach
1.4 billion arrivals by 2020 and 1.8
billion in 2030. We must prioritise
capacity development within the
tourism industry across Asean, said
Pangestu. Otherwise, how will we
cope with this rise in arrivals?
Indonesia has a key role to play
here, she said. We have some
of the regions oldest and most
established tourism schools. Cruise
operators tell me that Indonesians
are the largest nationality working
on the cruise lines, accounting for up
to 60 per cent of staff. All of these
people have received international
training and we should make better
use of that when they return home
by re-incorporating those skills back
into the local [tourism] industry.
While it is clear that action needs to
be taken rapidly if Asean as a whole
wants to beneft from the boom in
tourism arrivals, opening schools
and setting standards is only the
frst step.
As Pangestu said: The challenge
is once we set these standards we
have to ensure we [Indonesia] also
train our staff so they can meet
those standards.
Hire Education
INDONESIANS ARE
TRAVELLING MORE
AND MORE AND THE
ASEAN MARKET WILL BE
CONSOLIDATING OVER
THE NEXT FEW YEARS
10-11 STATUS QUO#2

12-13 STATUS QUO#2

PHILIPPINES
ITS
MORE FUN
IN THE
Q WHAT WERE YOUR THOUGHTS WHEN
YOU FIRST SAW THE ANNOUNCEMENT
OF THE PHILIPPINES NEW TOURISM
SLOGAN: ITS MORE FUN IN THE
PHILIPPINES?
Francis Gotianun, Assistant Vice
President, Filinvest Hospitality:
I thought it was straightforward
and presented a clear value
proposition. Also I liked the
fexibility of how the message
can be applied across various
aspects of the visitor experience.
Daryl Tan, Managing Director
[unannounced hotel]: It caught
my attention. Mainly because
this is the most creative tourism
campaign developed by the
Philippine Department of Tourism.
The creativity was shown through
the slogans simplicity and the
way it was able to capture the
essence of the Filipino spirit. It was
very relatable and I immediately
understood the message it was
trying to convey.
Raeanna Cranbourne, Project
Director, Raintree Hospitality
Group: It was a great improvement
on the previous DOTs slogan/
logo fasco which was a knock off
of Polands version. It grows on you
after a while.
Blaise Montandon, COO, Palawan
Development Company: Its easy
for everyone to understand.
However, it may be a bit too
simple and vague. Fun can also
be interpreted in a negative way
and it is restrictive to the leisure
market. What about the image
of the Philippines... is it a fun
place? If you ask the travellers
from Hong Kong I dont think
that would be the image that
comes to mind!
Q HOW WELL DO YOU THINK THE NEW
SLOGAN FUNCTIONS IN COMPARISON
TO PREVIOUS MARKETING CAMPAIGNS
IN THE PHILIPPINES, SUCH AS
WOW PHILIPPINES?
DT In terms of promoting Philippine
tourism, I think the new slogan has
gained the most traction out of any
of the previous campaigns. Previous
campaigns were able to capture the
beauty of the tourist places in the
Philippines. The new campaign is
able to show the countrys beauty
and also impart a sense of
experience and story.
RC Wow Philippines was a great
campaign, but the current Its
More Fun in the Philippines
is more young and hip, and
allows for a very tongue-in-cheek
approach. Everyone came up with
their own versions/memes and the
campaign promoted itself in a viral
manner online.
Q DO YOU THINK IT WILL WORK WELL
ACROSS TODAYS MULTIPLE PLATFORMS
AND MEDIA, INCLUDING PRINT,
BILLBOARDS, WEB, SOCIAL, ETC.?
FG Yes and it already has. We
continue to see it well executed
across all traditional and new
media platforms because of its
visual character and fexibility.
DT Defnitely. The simplicity of
the slogan requires very little
explanation making it ftting for
various platforms. I think the real
success of the campaign is that
it is very ownable by everyone,
just look at the mark its made
on social media.
RC Yes, especially through
social media.
BM It is a simple and direct
message that can work well
across various platforms.
Q THERE WAS SOME CONTROVERSY
ABOUT USING THE SLOGAN AFTER THE
DEVASTATION OF TYPHOON HAIYAN.
HOW DO YOU FEEL THE PHRASE WORKS
CONSIDERING SUCH A NATURAL DISASTER?
FG I believe any tourism slogan
is diffcult to use when framed by
natural or man-made disasters. I do
not think that the tourism phrases
of Thailand, Malaysia or India
would work any better. I do think
that the Philippine slogan does
point to the ability of Filipinos to
handle adversity with dignity, hope
and a positive attitude.
DT Because the slogan was
developed to promote tourism
in the Philippines, if taken within
the context of unfortunate natural
disasters such as Haiyan, at face
value there will be a disjoint.
But at heart, the slogan captures
the essence of Filipinos: their
resiliencyin the face of the bleakest
situations, the way we fnd joy in
helping together.
RC In the wake of a disaster, no
slogan would work well Wow
Philippines, or anything else along
those lines. During times like that,
the focus shifts.
BM For me it is a total image
disaster to have such a slogan after
Typhoon Haiyan. It was certainly
not fun.
Q ITS MORE FUN IN THE PHILIPPINES
SEEMS TO BE AIMED SQUARELY AT THE
LEISURE MARKET. DO YOU THINK THIS
COUNTRY BRANDING SHOULD ALSO
TARGET BUSINESS TRAVEL?
FG I believe that this slogan can
be used to target business travel.
It is just a matter of using the
right variation of the message and
image. I think fun is something
people want to experience even
when working.
DT Sure. More than targeting
specifc segments though,
the immediate goal is creating
awareness of the Philippines as
a destination. As David Guerrero,
chairman and chief creative offcer
of BBDO Guerrero, put it the
biggest problem is not the negative
perception of the country, its the
zero perception of the country.
RC No, because business travel
is driven by business needs, not
necessarily by an ad campaign.
The Its More Fun in the
Philippines campaign was very
catchy, with the images, wording
and music. It highlighted the best
of the country and its culture and
customs in a very captivating way.
BM Yes, the Philippines should
also target the business/MICE
markets. One should not only rely
on the leisure market, and with the
Philippines geographic location,
business/MICE markets have
potential. Also the command
of English across the country
is very high in comparison with
most countries in Asia, which
is key for business travellers.
Q ALREADY, ITS MORE FUN IN THE
PHILIPPINES HAS BECOME UBIQUITOUS
IN ADVERTISING, EMBRACED BY
LOCAL BUSINESSES. DO YOU HAVE
ANY CONCERNS ABOUT SUCH USAGE
DILUTING THE BRAND?
FG No, it adds to the brand because
it was embraced by local businesses.
Community support is what has
brought the campaign to life.
DT Not at all. On the contrary, the
genius of the campaign is that it is
so ownable and relatable, and the
traction its got, the virality, was
that everyone has made it their
own, which then extended the
campaigns reach and potential.
RC Yes, I was in Subic this weekend
and they have used the phrase Its
More Fun-tastic in Subic, which is
just plain ridiculous. They should
not be allowed to dilute the brand
this way.
Q AS SOMEBODY WITH A PASSION
FOR THE PHILIPPINES, COULD YOU TELL
READERS WHY YOU THINK IT IS MORE
FUN IN THE PHILIPPINES, AND WHY THEY
SHOULD VISIT?
FG It is more fun in the Philippines
because you will never feel more
welcome, with genuine service,
care and compassion.
DT People like myself travel to
experience the unfamiliar. To most,
the Philippines will represent just
that a melting pot of authentic,
unspoiled and undiluted experiences
that are uniquely Filipino.
RC It is more fun in the Philippines,
nothing gets us down. No matter
how many natural (and man-made)
disasters come this way, we always
see the silver lining of the dark cloud.
BM I am more familiar with
Palawan than other destinations
in the country. Palawan is very
unique in terms of its untouched
natural beauty and diversity. The
fora, the fauna, the beaches, the
sea and coral are out of this world.
It is one of the last gems left
to discover.
QUO Bangkok
22nd Floor, Ocean Tower II, 75/41-42
Sukhumvit 19, Bangkok 10110, Thailand
Tel: +66 (0)2 260 9494
Fax: +66 (0)2 661 7970
Email: info@quo-global.com
QUO Indochina
Floor 1, 316 Le Van Sy Street,
District Tan Binh, Ho Chi Minh City, Vietnam
Tel: +84 (0) 8 39917586
Fax: +84 (0) 39917585
Email: info@quo-indochina.com
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D-25, Lajpat Nagar-II
New Delhi - 110024, India
Email: info_india@quo-global.com
www.quo-global.com
Status QUO is a publication from QUO Asia. Opinions expressed in the publication are those of the authors and
are not necessarily those of QUO Asia. All rights are reserved. QUO Asia 2014
Status QUO is designed and edited by the QUO Asia creative team.
Contributing authors: Bill Barnett and Greg Lowe. Special thanks to Francis Gotianun, Daryl Tan,
Raeanna Cranbourne and Blaise Montandon for their interviews.
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ne of the newest hotels in Southeast Asia, the JW Marriott Hotel Hanoi opened
in December 2013 with 450 rooms and suites to service leisure and business
travellers. JWs brand philosophy guided the Hanoi propertys design choices,
which sought to make it ooze the approachable luxury principle that stands at the
companys core. Its a brand that tries hard to make sure it isnt perceived as trying too
hard, eschewing pretense. Properties are designed to be serene, providing a sense
of both privacy and interaction, a sense of both the locale and of the international
brand, a sense of sophistication without opulence.
While the oft clichd dichotomies of being both contemporary and local often
confound designers, this JW hopes to bridge the divide by relying on a modern
image of Vietnam. Let us take a closer look to see if the JW Caf, described as the
new defnition of contemporary luxury, succeeds in bringing JW Marriotts brand
values to life.
1. JWs core value of intuition is
made real by removing barriers
of worries and stress in order for
guests to be taken care of without
even knowing it. This JW Caf
offers its varied menu all day,
every day.
2. JW believes in craftsmanship,
and the JW Caf shows a meticulous
attention to detail. Even the
individual bulbs in the bold lighting
features were carefully chosen
to emphasise the warmth of the
venue without being distracting.
According to brand manuals, artful
lighting is an essential design
touch for all JW properties.

3. The choice of Mondrianesque
furnishings may, at frst, seem
distant from JW Marriotts
brand emphasis on the value
of refecting the genuine favour
of surroundings. But this ethos
is meant to be implemented
subtly and authentically, not
extravagantly. The simple striking
lines and colours of contemporary
art pieces align with Vietnams
vibrant modern metropolis.


4. Guests are encouraged to
comfortably be themselves
and lounge in leather chairs,
sip coffee brewed with local
beans, and refect on the days
accomplishments, to relax and
doing nothing.
5. One of the cafs highlights
is the view through the massive
windows: a charming stone bridge
crossing an expanse of water. Three
of the brands design imperatives
sense of place, well-placed awe,
and calm are represented.
6. In defning its brand-wide
design dictate of well-placed awe,
JW specifes the use of rich and
layered fnishes.

7. JW eschews opulence, but
that doesnt mean they are afraid of
using colour. In an effort to create a
calming atmosphere, design criteria
include the need for a warm and
inviting palette in every property,
including the cream and orange
colour scheme not visible in this
black-and-white photo.
A BRAND IN SITU.
AMPED
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