New budget hotels in Seoul offer premium at low price
Published: 05 Nov. 2014, 19:39
The Cafe (above) at the more affordable Shilla Stay hotel in Yeoksam-dong, southern Seoul, serves breakfast that is of the same quality as the luxury Shilla Hotel Seoul in Jangchung-dong, central Seoul.
Big-name hotel operators in the city such as Hotel Shilla, Lotte Hotel, Starwood and Accor Group are targeting tourists on a shoestring who want to take more time to explore.
Most recently, Accor Group opened the Ibis Budget Ambassador Seoul Dongdaemun near the newly built Dongdaemun Design Plaza in Jung District, central Seoul.
The French company, which established a joint venture with local Ambassador Hotel back in 2006, brought its economical chain to Seoul for travelers looking for cheaper lodging options.
Aloft, an affordable hotel operated by Starwood, incorporates music and design in its rooms to lure guests hoping to stay in Samseong-dong, southern Seoul.
“I think what is very important to operate a [budget] hotel is how you differentiate the product in terms of comfort,” said Patrick Basset, Accor Group’s Asia chief operating officer, during his visit to Korea for the Ibis Seoul hotel’s launch.
On top of featuring trendy interiors and furnishings, such as room designs and bedding, according to Basset it is important for the hotels to strive to provide better service.
The executive said that even when a guest only asks one question, the hotel should be ready to provide a response that includes answers to any follow-up questions the guest might have.
Equipped with the skills to offer a superior service, the business traveler-oriented Shilla Stay chain, which is a more affordable offshoot of Hotel Shilla, aims to take a large portion of the budget hotel market share with its plan to open 10 facilities in total by 2016.
Lotte Group, which has been operating budget hotels under its City Hotel brand, also plans to open another in Myeong-dong, a tourist-filled area of central Seoul.
The reason so many budget hotels are opening up can be traced back to a couple of years ago when the government encouraged local companies to launch cheaper accommodation services.
Ibis Budget Ambassador Dongdaemun Hotel uses vivid color to add more character to its communal area, pictured above. Provided by the hotels
Companies granted approval have been actively opening up new hotels as a result.
However, the issue here is whether these hotels, which usually provide five-star services, will remain viable.
“The local hotel industry has been raising its investment thanks to an influx of Asian tourists from China, Japan, Vietnam and other nations, but that could easily change due to the many political, economical and social variables as the tourism industry is relatively more vulnerable to those factors than any other industries,” Lee Kang-seo, a senior researcher at NICE Investors Service, wrote in a report last month.
“So it is unpredictable to say whether the favorable conditions for local hotels will continue.”
To stay competitive in the market, the affordable chains plan to differentiate themselves from other types of hotels.
“The difference between the two Shilla hotels is that Shilla Stay doesn’t have any banquet rooms nor does it operate many restaurants, which are the major reasons hotels do not make much profit,” said an representative at Hotel Shilla’s communications team.
“Since the more affordable chain only has small meeting rooms and mostly focuses on operating guest rooms, we are at an advantage as long as we have a high booking rate.”
Aloft, a budget accommodation brand from U.S. company Starwood, which is known for running the W and Sheraton hotels, entices people who want an aesthetically pleasing experience with the slogan “Style at a Steal.”
The brand also incorporates music experiences into its services. The hotel chain hosts music events to draw in guests with an interest in culture, such as the international “Live at Aloft Hotels” program that was launched in 2008 to find and support talented musicians.
By Lee Sun-min [summerlee@joongang.co.kr]
with the Korea JoongAng Daily
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