The impact of COVID-19 was not as severe in South Korea as it was in many other countries for most luxury goods, but luxury hotels suffered badly due to the steep decline in the number of tourists visiting the country. Domestic tourism also suffered during the first half of 2020, although, with the summer vacation season, luxury hotels demonstrated some progress.
Luxury hotels are now focusing on strengthening their luxury services. In particular, in order to satisfy the sensibilities of hotel guests with their own unique fragrance, luxury hotels are developing their own signature fragrances as well as launching various amenities containing hotel fragrances.
The Signiel brand opened a new hotel in Busan in June 2020. Busan is developing very rapidly, and other luxury hotels, such as Park Hyatt and Paradise Hotel, are already successfully operating in the Busan area, which is a hotspot for families and friends to visit.
With social distancing level 4 having been introduced in parts of the country in July 2021, following a surge in delta variant cases, locals were facing the toughest restrictions since the breakout of COVID-19. The “hocance” trend of spending holidays in hotels in the domestic market, particularly luxury outlets, is therefore expected to continue to be seen in 2021 and 2022.
Luxury hotels are trying to provide guests with “contact-free” stays in the era of COVID-19. Lotte Hotel has introduced a delivery robot to minimise service blind spots in its hotels, and is also continuing to introduce services tailored to customer needs and trends, such as a smart concierge service that provides tourism information easily through QR code access, an unmanned currency exchange kiosk and an artificial intelligence (AI) speaker.
The threat to the luxury hotels category is represented by alternative but equally luxurious accommodation types doing well. Privately-owned pensions and condos with membership are increasingly preferred by wealthy consumers.
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Understand the latest market trends and future growth opportunities for the Luxury Hotels (5-star plus) industry in South Korea with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
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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 DefinitionsThis report originates from Passport, our Luxury Hotels (5-star plus) research and analysis database.
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