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Korea Hospitality Industry report: ONDA Stay Index Q1, 2022 - Hotel and Accommodation industry of Korea are recovering

Author: Theodore Koumelis / Date: Wed, 05/11/2022 - 11:38
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‘Jeju’ records the highest demand market and ‘Gyeongsangbuk-do’ has rapidly emerged as a popular destination.

ONDA, who leads the Digitalization of Hospitality industry announced ’ONDA Stay Index (OSI)’, the analysis report of Q1, 2022 for the Korea domestic accommodation industry.

In the Q1 of 2022, the hotel and accommodation industry entered a recovery stage as social distancing gradually eased and the expectation for the endemic transition grew.

According to ONDA Stay Index, total sales of the domestic accommodation industry in the Q1, 2022 increased about 87% year-on-year. Compared to the first quarter of 2020, it increased by 150%. As social distancing measures are eased gradually, demand for travel, which has been suppressed for a long time, is analyzed to be a major factor in sales growth in the first quarter.

First of all, Jeju Island, which grew significantly last year, also grew 177% year-on-year this year, solidifying its position as a travel destination to replace overseas travel. As the preference for domestic travel increased due to the prolonged COVID-19, the psychology to find new travel destinations has increased, and Gyeongsangbuk-do has rapidly emerged as a new travel destination connecting Jeju Island with more than double the growth rate.

Major cities such as Seoul and Busan rebounded to 197% and 283%, respectively, but it was analyzed that this was due to the base effect caused by the COVID-19 crisis in Q1 quarter last year.

Most online sales channels grew significantly compared to the same period last year. However, it has been confirmed that the growth of e-commerce platforms is not significant compared to domestic and foreign OTA channels that are breaking records every year. In particular, e-commerce accounted for 40.2% of the total share of the channel, down 9.5% from the same period last year, while overseas OTA increased 4.2% and domestic OTA increased 2.0%, proving that the transition from e-commerce to OTA is in full swing.

In addition, D2C (Direct to Customers) booking has increased significantly to 187.41%. The main reason for the rise is that hotels and lodging industries, which have been hit hard by the pandemic, chose Google Hotels, which signed an exclusive partnership in Korea, as a breakthrough to reduce fees and maximize their own profits.

Onda Kim Ki-wook, head of Data Lab, said, “In the Q2 of this year, the growth is expected to be even more explosive than in the Q1 reflecting the effects of the warm weather, not only the mini-peak season, but also the synergy effect will be better.”

Onda investigates and announces the ONDA Stay Index every quarter so that hotel and accommodation industry people can catch the industry trends. It is based on about 50,000 room data accumulated in the nation’s largest sales network (GDS) owned by Onda, and is the result of analyzing actual sales transactions such as sales areas, accommodation types, room types, and sales timing.
 

ABOUT THE AUTHOR

Theodore Koumelis

Co-Founder & Managing Director

Theodore is the Co-Founder and Managing Editor of TravelDailyNews Media Network; his responsibilities include business development and planning for TravelDailyNews long-term opportunities.