HotelsAgoda says the domestic market is propping up the "beginning of beginning of Covid recovery" for some Asia-Pacific markets.

Early signs of turnaround for APAC hospitality but recovery far from certain

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Weekend drive holidays have bolstered demand for destinations around Bangkok.
Weekend drive holidays have bolstered demand for destinations around Bangkok. Photo Credit: Sarinyapinngam/Getty Images

A rebound in local travel demand appears to have sprung up across parts of Asia-Pacific as the Covid-19 contagion comes under control, but travel executives believe it is still premature to make predictions if recovery is in sight.

That was the message from Agoda vice president corporate development Timothy Hughes during a recent webinar hosted by Travel Massive. While the Agoda executive thinks it is too early to tell how quickly the travel market would recover, he is optimistic that the hospitality industry is now seeing the "beginning of the beginning of Covid recovery" based on some encouraging signs across the region.

"Consumers come back almost immediately when travel is possible in the market," said Hughes, sharing that Agoda has witnessed booking surge on the same day that travel restrictions are lifted in local markets. "The pent-up demand releases quickly."

According to him, many travel consumers are "on a genuine hunt for escapes", seeking out stays in beaches and mountains rather than urban experiences.

The desire to get away post lockdown is particularly evident in the drive market, with destinations around Bangkok seeing high weekend bookings in recent weeks. Elsewhere in the region, Taiwan also saw a huge spike in domestic travel demand during the recent Dragon Boat Festival in late June, said Hughes.

That the domestic market will drive the first wave of tourism revival is already well understood, but the boost in homegrown tourism will not be enough to replace pre-pandemic revenue recorded in 2019. "2020 has to be thought of as the year of the domestic. We can no longer wait for inbound to come back," said Hughes. "No marketing campaign can stimulate demand when quarantines and airline suspensions are in place.

And without inbound visitors or big meetings or weddings allowed, he also noted that the path to recovery is likely more arduous for certain segments such as youth hostels in urban cities or large-scale hotels with strong MICE focus pre pandemic.

But the current lull in demand also offers hoteliers a good opportunity for "technology refresh" so that they can come out of the Covid-19 crisis with "a much more digitalised experience", expressed the Agoda executive.

Hughes urged hoteliers to focus on upgraded service and sell more merchandise, not unlike airlines' airfare unbundling move in recent years to allow passengers to construct the seat that they want.

Enabling guests to build their own room experience will see travellers spending more money in the room, he suggested.

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