As reported on Balidiscovery.com [See: Bali Legislators Protest Tune Hotels Entry into Local Market] Bali two new "no frills" hotels have come under criticism form local legislators and business circles claiming their low price policies infringe on a portion of the market normally reserved for indigenous investors.
Mark Lankster, Group CEO of Tune Hotels has contacted balidiscovery.com with the following points of rebuttal:
• Tune Hotels.com is a limited service product. What this means is that we eschew the traditional amenities that our guests have told us are not important to them and pass on the cost savings directly to our guests. These amenities include ballrooms, business centers, conference rooms, swimming pools, gymnasiums and so forth. In addition we are very mindful of the massive carbon footprint that traditional hotels produce via extraordinary energy use and try to reduce energy costs as much possible via assisting our guests to save on air-conditioning and reduce effluent into our sewerage systems through lowering laundering of towels, etc. We provide very competitive room rates which are not inclusive of air-conditioning or towels and amenities and by paying extra assist our guests to play their part via a "
"pay for use" system.
• Our overall pricing policy is driven very much by our business model. Our model is that bookings are driven through our website and our booking engine deploys a proprietary demand based pricing model. What this means is that consumers, similar to the low cost carriers, who plan in advance can obtain very attractive room rates for stay dates booked significantly in advance. Bookings made at a late stage, i.e. for only a week in advance or if a walk-in, attract a higher price, depending on the demand for room bookings on that specific date and generated by the software within our bookings engine. For our Bali hotels a single room rate starts at Rupiah 68,000 per night, not including charges and taxes, again provided you book significantly in advance and the other end of the spectrum on late bookings or walk-in bookings, we would naturally be comparable with other 3 star hotels.
• Our mantra is that we do provide a “5 Star Sleeping Experience for a 1 Star Price”, meaning that for attractive room rates for advance bookings, we offer a great night’s sleep with great beds. We are not a 5 star hotel with the amenities and services of a 5 star hotel.
• The macro economic reality is that the world's low cost carriers are driving the growth of passenger numbers and tourists overall. Some of these passengers will opt to stay at limited service hotels and book considerably in advance, like Tune Hotels.com, but some clearly will opt to stay at higher end hotels and resorts and locally flavored Melati styled accommodation. We have seen that the growth in total passenger numbers and in addition, our own aggressive marketing and advertising strategies, tends to benefit the entire tourism ecosystem. First of all, oftentimes we are full on 100% occupancy and other hotels, inns and resorts are automatically beneficiaries from our aggressive marketing. Secondly, the guests at any of the Tune Hotels.com network, end up actually spending more time and money in the local economy as they have saved on "in-hotel" costs, specifically room rates. The multiplier effect within the local economy can be quite significant.
• Travelers and tourists are considerably smarter today and know what they want and are in a position to make informed decisions. A Tune Hotel will not fit the needs and expectations of all. Each class of hotel in, for example Bali, has its specific lure and attractions. What we do offer is additional choice in the hospitality spectrum and that choice comes with a limited amount of services.
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