Resolving noncompetitive price at Tan Son Nhat hotel

Abstract

Global Online travel industry is a fast-growing industry with the forecast Compounded Annual Growth Rate (CAGR) from 2021 -2027 of 13.7% according to Astute Analytica. Viet Nam is the third biggest APAC region outside of China with the gross merchandise value of 3 billion USD. The online travel agencies (OTA) are contributing more and more percentage on hotel’s revenue, thus strongly growing their effect on hotel decisions. Tan Son Nhat 5-star Hotel, a hotel belonging to Tan Son Nhat Hotel group, has a great location near Tan Son Nhat international airport with many advantages of being a military hotel such as high level of security and big area in the heart of Phu Nhuan district. However, through the research the author discovers that its revenue from OTAs is too low compared to its potential due to the low visibility ranking. Through research and observation, three problems were found, (1) Poor availability, (2) Noncompetitive price, (3) Low guest review score, after the validation, the second problem (noncompetitive price) was identified as the main problem. Further research discovers the causes for this problem are (1) ineffective management, (2) Lack of market research, (3) Inappropriate price strategy and one of these causes was identified as the central cause for the problem. After that, two alternative solutions were proposed to solve the cause and the most suitable solution was chosen based on analyzing the situation of the hotel, then an action plan was built to apply the solution. This thesis uses primary and secondary data from observation, interviews, case studies, literature… to support the findings.