In 2020 there was a substantial decline in demand for luxury hotels in Indonesia as travel restrictions, specifically the ban on inbound arrivals, and large-scale social restrictions in response to the COVID-19 pandemic undermined the ability of hoteliers to attract guests. Indonesia’s luxury hotels tend to rely heavily on inbound business travellers and foreign tourists to generate bookings.
Faced with plummeting demand due to the absence of foreign visitors and the lack of demand among affluent locals, many of the leading players in luxury hotels in Indonesia offered generous discounts on room rates throughout the pandemic. In addition, many sought to appeal to consumers via voucher schemes to support flagging demand and generate higher sales.
One of the key strategies undertaken to resolve the low occupancy rates among Indonesia’s leading luxury hotels was a broadening of guest profiles. Typically, Indonesia’s luxury hotels have relied on foreign visitors for the bulk of their bookings.
Over the forecast period, Indonesia luxury hotels is expected to see a slow but steady recovery in line with the return of inbound tourism. Given that a more relaxed border policy has already been lifted for some popular international tourism areas like Bali, it is expected that more international tourists will visit the country in the coming years.
Crucial to the recovery of luxury hotels is the expected increase in demand for MICE tourism. This is an area of Indonesia’s travel and tourism industry which has boomed in recent years, particularly as Jakarta has emerged strongly as a regional business travel destination.
One major change that is expected to be seen in luxury hotels in Indonesia during the forecast period is a much greater focus on hygiene and cleanliness. This will be a lingering reaction to the COVID-19 pandemic, which forced luxury hoteliers to address various hygiene and cleanliness issues to cater to the needs of their high-end clientele.
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Understand the latest market trends and future growth opportunities for the Luxury Hotels industry in Indonesia with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
Key trends are clearly and succinctly summarised alongside the most current research data available. Understand and assess competitive threats and plan corporate strategy with our qualitative analysis, insight and confident growth projections.
If you're in the Luxury Hotels industry in Indonesia, our research will help you to make informed, intelligent decisions; to recognise and profit from opportunity, or to offer resilience amidst market uncertainty.
Luxury: includes luxury and upper upscale hotels. Would generally include 5-star hotels and above, but may include some “4.5-Star” outlets, provided that the brands positioning warrants it. The luxury classification is primarily determined by the brand’s positioning and marketing, which will be at the high-end. Brand examples include Marriott, Hilton, Sofitel and InterContinental.See All of Our Definitions
This report originates from Passport, our Luxury Hotels research and analysis database.
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