Centara Bets on Asia’s Budget Boom

8 years, 8 months ago - January 18, 2013
BANGKOK—Building off the boom of Southeast Asia’s budget airline sector, Centara Hotels & Resorts is developing a new economy hotel brand that is set to take flight in 2015.

COSI Hotels—which stands for comfortable, open, sensible and individual—will target cost-conscious travelers who conduct the majority of their hotel searches and bookings online.

 “There is an enormous change in the travel market in the Asia/Pacific, as the economies of the region expand and the number of domestic and international travelers increases,” said Suparat Chirathivat Uahwatanasakul, VP of development for Centara’s management and development arm, Centara International Management. “We are seeing an entirely new generation of travelers in both the leisure and business travel sectors, who are cost-conscious, and who do all their research and booking on-line. Much of this market is driven by the growth of the budget airlines, which are allowing people to travel more easily and conveniently.”.

The first COSI Hotel is projected to open in 2015 and Centara plans to have at least 30 operational by 2020.

 “At the beginning, we plan to expand in well-known business and leisure destinations, for example Bangkok, Phuket, Pattaya, Chiang Mai, Phitsanulok, Udon Thani, Hat Yai, and so on,” Uahwatanasakul said via email. “Once we are well established in Thailand, we will start to expand in the (Association of Southeast Asian Nation) countries, and in China, Australia and New Zealand.”

Building a budget brand

The budget brand is the high-end operator’s first foray into the budget space—a shift that required an entirely new way of thinking, Uahwatanasakul said.

 “We spent three years to understand and absorb what it needs to be a successful economy brand. We shifted our mindset to be able to think ‘economic, innovative and efficient’ and to condense this into a brand,” he said, adding COSI will be operated by a separate unit within Centara. 

The company is working on authority approval of its first hotel, which means specific details about the look and features of COSI are still confidential.

However, Uahwatanasakul did say the success of the brand will rest heavily on its online distribution.

 “Our distribution objectives are primarily to distribute online mostly via our own websites,” he said. “Our own database currently exceeds 5.3 million potential guests, and we will look at an advertising campaign that will further communicate this new brand in all targeted source markets directing guests to our websites. The launch of our new loyalty program in January 2013 will also support marketing and distribution of COSI.”

Checking in with Centara

In addition to COSI, Centara also operates Centara Grand Hotels & Resorts, Centara Hotels & Resorts, and Centara Boutique Collection. The total portfolio counts 58 properties.

 “We grew from 12 hotels three years ago to 58 hotels this year,” Uahwatanasakul said. “We are growing very fast with an asset-light strategy. There are many hotel developers interested in an Asian brand like Centara. We have capability with a 30-year history of success. We plan to have 10 new hotel management contracts every year and maybe investment in one hotel in gateway cities every two to three years.”

The biggest challenge during that period of rapid expansion was finding the right people for each property, Uahwatanasakul said.

 “In the hotel business, training is one of the critical activities that we have heavily invested in,” he said. “We want to make sure that all of our employees understand our brand expectations and deliverables as well as organization culture. Moreover, we emphasize on the employee’s capability and services from their heart with a beautiful smile. We believe that this is one key area that has helped us achieve in the hotel business for 30 years.”

Centara Hotels & Resorts is part of Central Plaza Hotel Public Company, or CENTEL, which was founded in 1980.

 “We are the leading Thai hotel chain in this country and a part of Central Group,” Uahwatanasakul said. “It has opened to us many great opportunities. We are very grateful for this. We also value all of (our) business partners, especially our hotel owners, who help us and lead to our success, and who always bring great opportunities to us.”

 

Text by Hotel News Now

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