Vietnamese Hotel Groups Can Become Southeast Asian Champions as Local Agility Meets International Standards

Vietnam’s hospitality industry is entering a phase in which local hotel groups are increasingly competing with international operators on product quality, design and resort scale, according to Frederic Savoye, Chief Commercial Officer at Alma Resort.

Speaking in an exclusive interview at the Hotel Innovation Summit Asia, Savoye said Vietnamese ownership groups have one particularly important advantage over large international hotel companies: speed of decision-making. Because local groups are generally closer to ownership, they can approve investments faster and respond more quickly to changing market opportunities.

“Local groups are competing head-to-head with international ones especially from a product quality, design and resort scale point of view,” Savoye said. However, he added that their proximity to ownership can make them “much more agile” than larger international organisations, where investment approvals can take longer.

International operators retain an advantage in consistency and loyalty

While Vietnamese groups are narrowing the gap, Savoye pointed to areas where international operators continue to have an advantage.

Large international brands typically offer established operating procedures and consistent standards across areas such as housekeeping and food and beverage. This consistency can provide reassurance to international travellers who expect familiar fundamentals when selecting a hospitality product.

Savoye also highlighted the power of international loyalty programmes. Major hotel groups can use their membership ecosystems to drive large numbers of guests towards destinations and properties.

For independent local groups without an international management agreement or franchise, competing for those international customers can therefore remain challenging.

Savoye believes Vietnamese operators can respond by combining stronger standards with distinctive experiences.

“The standard sometimes can be boring,” he said, arguing that local properties can differentiate themselves by creating a distinct experience while still maintaining the standards expected by international guests. Such differentiation, he suggested, can support loyalty, word of mouth and demand from particular source markets.

Hospitality expertise must enter projects early

For Savoye, building a successful hospitality business begins well before a resort opens.

He stressed the importance of involving hospitality expertise at the earliest stage of a development project. Decisions made during the conception, design and architectural phases can have commercial consequences for decades.

A property must be conceived around the clientele and source markets it intends to attract. Developers need to understand what guests want to experience, what they are prepared to pay for and what might encourage them to return.

Savoye used resort development in Vietnam as an example. A property targeting regional Asian markets, where stays may be relatively short, could require a different design and facility mix from a resort targeting guests staying for seven, 10 or 14 nights.

Shorter-stay guests may prioritise efficiency and convenience, while longer-stay visitors need enough territory and activities to remain engaged throughout their holiday.

“Understanding at the beginning of a project to what source market, what kind of clientele you want your product to talk to, it’s key,” Savoye said.

Geopolitical changes are reshaping source markets

Savoye also discussed how rapidly changing geopolitical conditions can alter tourism demand.

He described how higher energy costs had affected airfare and, consequently, some source markets. At the same time, he said certain destinations benefited from shifts in travel demand.

He cited a surge in the Russian segment following changes in travel patterns linked to conflict in the Middle East. According to Savoye, travellers who had previously considered Middle Eastern destinations looked towards alternatives including Egypt, Türkiye and Southeast Asia.

For hospitality businesses, however, simply increasing room rates in response to higher demand is not necessarily the only opportunity.

Savoye argued that destinations should use periods of stronger demand to improve service delivery and raise standards. The objective is to ensure that travellers who discover a destination because their original choice has become less accessible are satisfied enough to return in the future.

He emphasised the importance of word of mouth in converting temporary demand into repeat business.

Vietnam can compete for premium and luxury travellers

Savoye sees an opportunity for Vietnam and Southeast Asia to attract travellers who traditionally might have selected premium destinations elsewhere.

But higher rates must be accompanied by stronger experiences and service delivery.

He pointed to the high expectations of Middle Eastern travellers, particularly in premium and luxury hospitality, based on his professional experience in the region. For Vietnamese resorts seeking to attract such customers, delivering an appropriate level of luxury is therefore essential.

“The challenge that Cam Ranh and to an extent the destination is to raise the standards,” Savoye said, particularly among local groups, so that guests perceive the product as a genuine premium or luxury value proposition.

He also said that opportunities exist across several markets, mentioning Australia, Japan and the United States in the context of market development.

International partnerships could help local groups scale

Savoye believes partnerships with international operators can provide Vietnamese hotel groups with a pathway to build their capabilities while retaining their local strengths.

An international management agreement established early in a project’s development can provide access to senior leadership, operating systems, training and commercial expertise. These capabilities can be difficult for a growing hospitality company to establish independently.

He suggested that such agreements do not necessarily need to remain permanent.

Once a local owner has developed sufficient organisational and operational capabilities, moving from a management agreement to a franchise arrangement could allow the group to retain access to international standards and brand strength while taking greater control of operations.

The model, in Savoye’s view, can allow local groups to benefit from international expertise while developing their own organisational capability.

The next five years could define Vietnam’s regional ambitions

Looking ahead, Savoye said the future success of Vietnamese hotel groups will depend on their ability to combine local agility with international-level hospitality capabilities.

He argued that operators need to become more skilled and agile in responding to geopolitical and market changes while maintaining their own identity.

The ability to adapt products for different source markets will also become increasingly important. Savoye noted that Australian, Russian, Kazakh and Japanese travellers do not necessarily have identical expectations, making market-specific adaptation important.

At the same time, Vietnamese groups need to maintain a strong enough product and service proposition to attract guests willing to pay premium and luxury rates.

International partnerships, followed by franchising when a local organisation reaches sufficient scale and capability, could form part of that development path.

Ultimately, Savoye sees the opportunity for Vietnamese hospitality companies to move beyond the domestic market and establish themselves regionally.

“The future group that we are talking about now as an example, you know, will become in the next five years Southeast Asian champion beyond the border of Vietnam,” he said.

A new competitive equation for Vietnamese hospitality

Savoye’s message is clear: local ownership does not have to mean lower standards, while international standards do not necessarily have to mean permanent dependence on international operators.

Vietnamese hotel groups can use their decision-making agility as a competitive advantage while investing in operating consistency, commercial expertise, differentiated guest experiences and market-specific products.

For developers, the lesson begins even earlier: hospitality expertise needs to be incorporated into a project from its conception, because decisions about design, facilities and positioning can shape commercial performance for decades.

If Vietnamese operators can combine those capabilities with disciplined standards and the ability to respond quickly to changing international demand, Savoye believes the strongest groups could evolve from domestic players into significant Southeast Asian hospitality champions.