New travellers with new needs will create new dynamics that will drive rates and the shape of hotels to come in Asia, Yeoh Siew Hoon reports.

To InterContinental Hotel Group's Peter Gowers (pictured), the future in the region not only looks rosy but also different.

Indeed, the chief executive for Asia Pacific believes the Asian travel industry might be in for a bigger structural change than it expects.

At the Jones Lang Lasalle Hotels investment conference, he predicted, "We are about to see the next generation of travellers and the rising of China" that will create "new dynamics that will drive rates".

"More than 50% of business travellers in China earn less than 6,000RMB a year. Forget China as a market for luxury hotels," he said, further adding, "More than 50% of China's business travellers are Generation X and Y, they are under-40 and they are very different from the Americans and Europeans."

Quoting another statistic, he said, "25% of China's business travellers played a video game in the last week. When we are building hotels, are we respectful of these changes? Have we built the right hotel? Our research tells us there are a lot of unmet needs out there."

He said these changes had to be filtered down to the way hotels operate. "In the past, brand standards were set by personal tastes – what colour do you like?

But he said "the difference between a 250 and 180 thread count means $15 million to an owner".

Accor Asia Pacific's chairman and chief executive, Michael Issenberg, retorted that his group had never seen China as a luxury market. "We are building Ibis and Novotels and our hotels in China have limited food & beverage.

"I think the days are over when you said to make money, you need to build expensive ghotels. China is growing but it is not, by any stretch of the imagination, dominant. Intra-Asian traffic is the bigger market."

Millennium & Copthorne Hotels' CEO Richard Hartman (pictured) had his bit to add to the discussion.

True, he said, the days of the high-spending Americans are over. The US dollar is on parity with the Australian dollar. There's a whole change in the way people travel.

"The hotel industry in Asia has matured and as it matures, the big hotel with 25 restaurants which serves as the social heart of the city will change. The optimum size will be smaller over time."

Yeoh Siew Hoon, one of Asia's most respected travel editors and commentators, writes a regular column on news, trends and issues in the hospitality industry for 4Hoteliers.com.

Siew Hoon, who has covered the tourism industry in Asia/Pacific for the past 20 years, runs SHY Ventures Pte Ltd. Her other writings can be found at www.thetransitcafe.com

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