The Vietnamese hotel market is entering a new growth phase, driven by a strong recovery in tourism demand, improved infrastructure, and rapidly changing customer behaviour. According to Euromonitor, in 2025, Vietnam's tourism sector will continue to be supported by the recovery of both international and domestic visitors, more favourable visa policies, the development of aviation infrastructure, and the return of business activities and events. Notably, the growth of travel content on social media and online booking platforms is increasingly influencing how customers discover and choose accommodation. These positive signals present significant opportunities for hotels and resorts, but also pose a more complex challenge: how to achieve growth without over-reliance on discounting, OTAs, or continuously increasing capacity?

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In reality, revenue growth during a few peak seasons cannot be considered sustainable. A hotel may achieve high occupancy rates but still face profitability issues if distribution costs are high, pricing lacks strategy, staff productivity is low, or non-room revenue streams are not exploited. Conversely, a hotel capable of building a strong brand, creating distinctive experiences, effectively controlling costs, and maintaining a high repeat guest rate will have a more stable growth foundation, even in a volatile market. According to Savills, in Q1 2025, the Ho Chi Minh City hotel market achieved an occupancy rate of 68%, a 2 percentage point increase year-on-year, while the average room rate reached approximately 2.2 million VND/room/night. In Hanoi, hotel occupancy reached 76%, an 11 percentage point increase compared to the previous year. These figures indicate a positive recovery in demand, but they also pose a more crucial question for operators: when the market is growing overall, what factors will enable a hotel to grow faster and more sustainably than its competitors? The answer lies in shifting from a mindset of “selling more rooms” to a mindset of “creating more value per guest, per room, and per resource”.

The Formula for Sustainable Growth: Demand × Experience × Efficiency × Loyalty

From a management perspective, the sustainable growth of a modern hotel can be summarised by four closely linked elements: the right demand, excellent experience, efficient operations, and customer loyalty. This formula is crucial because each element directly impacts revenue and profit generation. If there is demand but a poor experience, the hotel will struggle to attract repeat guests. If there is a good experience but inefficient operations, increased revenue may not necessarily lead to profit. If technology is implemented but fails to solve customer problems, digital investment can become a cost rather than a growth driver.

1. Growth begins with accurately understanding market demand

Modern hotel guests are no longer a homogeneous group. A business traveller may be concerned with check-in speed, internet connectivity, and location; families care about space, children's amenities, and convenience; high-end leisure guests prioritise privacy, personalisation, and memorable experiences. Therefore, a growth strategy should not start with the question "how can we sell more rooms?", but rather "which customers bring the most value and what are they looking for?".

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Euromonitor notes that the Vietnamese accommodation market continues to benefit from growth in domestic and international tourism, increasing disposable income, and investment capital into hospitality infrastructure. The report also highlights a growing interest in sustainable accommodation models and authentic local experiences. This necessitates demand management tailored to each segment, rather than simply chasing overall guest numbers. Hotels need to identify which guest groups have high spending potential, long stays, good return rates, or are likely to use multiple services within the hotel's ecosystem. In this context, Revenue Management is not just about adjusting room rates based on occupancy. It's about optimising the total customer lifetime value, from room rates, F&B, spa, MICE, and experiential services, to the likelihood of return visits and brand recommendations.

2. Customer experience becomes a hard-to-replicate competitive advantage

In a market where customers can easily compare hundreds of hotels on the same platform, physical products are increasingly unlikely to be an absolute competitive advantage. A beautiful room can be replicated. A promotional offer can be matched by a competitor. But a well-designed and consistent experience is much harder to copy. Deloitte suggests that the hospitality industry is heavily impacted by changing customer behaviour and economic pressures. Guests increasingly expect experiences tailored to their individual needs, while hotels must simultaneously address challenges in staffing, capital, and operational efficiency.

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Notably, research by Deloitte and Mews shows that 76% of surveyed hotel managers agree that personalisation improves reputation and guest return rates; 70% believe technology helps hotels provide better personalised experiences. This indicates that personalisation is no longer just a marketing idea, but is becoming an integral part of the operating model. Data from previous stays can be used to remember room preferences, dietary needs, pillow types, check-in times, or services guests frequently use. When information is connected across Sales, Reservations, Front Office, Housekeeping, F&B, and Marketing, customers will perceive consistency instead of having to repeat their needs at each touchpoint. From this, the experience not only makes guests more satisfied but also enables the hotel to increase revenue from supplementary services and build loyalty.

Digital Transformation: From Support Tool to Growth Infrastructure

One of the biggest changes in the modern hotel industry is that technology is shifting from a "operational support" role to the infrastructure for experience and growth. Decision Lab reports that in Q1 2025, approximately 80% of surveyed Vietnamese consumers stated they had used AI-integrated tools. ChatGPT reached 57% usage, Gemini 36%, and Meta AI 29%. This shows that AI has moved beyond the experimental phase to become part of Vietnamese consumers' digital behaviour. For hotels, this change is highly significant. The customer journey can begin with an AI query, a TikTok video, a Google review, social media content, or a recommendation from an OTA platform before the guest directly visits the hotel website.

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In other words, the competition no longer starts at the front desk. It begins the moment a customer forms the intention to travel. Therefore, hotels need to build a comprehensive digital ecosystem spanning from the search and booking phases, pre-arrival, during the stay, and post-departure. Websites must be easy to find and convert. Booking systems must be simple. CRM needs to store and analyse customer data. Chatbots and AI can help answer common questions. PMS, POS, CRS, RMS, and other operational platforms need data connectivity rather than operating as isolated "islands." Statista forecasts that Vietnam's hotel market revenue could reach approximately 13.4 billion USD in 2025 and grow at an average rate of about 11.82% annually between 2025–2030. Notably, online channel revenue is projected to account for approximately 63% of total market revenue by 2030. This figure indicates that digital transformation is no longer a formal option. Digital capability will increasingly determine a hotel's ability to reach customers, convert bookings, and manage direct relationships with guests.

Sustainable Growth Must Be Accompanied by Operational Efficiency

Revenue growth that is outpaced by cost increases is not sustainable. This is a common oversight for many hotels that focus too heavily on occupancy or top-line revenue. A modern hotel needs to manage both revenue and productivity simultaneously. This includes optimising staff schedules, reducing manual processing time, controlling wastage, optimising energy consumption, managing F&B inventory, enhancing room productivity, and streamlining non-value-adding customer processes.

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AI and automation can play a crucial role in this process. Deloitte reports that 81% of hotel operators in their study prioritise enhancing staff productivity, while 49% view integrating AI solutions as a technology priority. It is important to note that the goal of technology is not necessarily to replace humans. In hospitality, the greater value lies in freeing up staff from repetitive tasks so they can focus on interactions that create emotional connections and value for guests. For example, AI can assist with demand forecasting, data analysis, answering FAQs, optimising schedules, or detecting operational anomalies. Meanwhile, staff remain critical in situations requiring empathy, flexibility, and problem-solving skills. This is a key principle of the modern hotel: technology-enabled, human-led, where technology empowers, but humans create hospitality.

Sustainability is not just an environmental issue

When discussing sustainable growth, many businesses still equate it with saving electricity, reducing plastic, or minimising waste. While these factors are necessary, they are not sufficient. A sustainable hotel model must be simultaneously sustainable in terms of finance, operations, human resources, customer experience, and environment. Deloitte reports that 83% of senior leaders in their global survey increased their investment in sustainability in the 12 months prior to the survey. The report also highlights that technology, including AI, is becoming a crucial tool to help businesses enhance efficiency and drive sustainable initiatives.

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In the hotel industry, this can start with very specific actions such as energy management systems, optimising air conditioning based on room status, reducing food waste, controlling water consumption, managing procurement, and designing more efficient housekeeping processes. Euromonitor also notes that hotels in Vietnam are increasingly adopting green technology, energy-efficient designs, and waste management programmes to meet the demands of a growing segment of environmentally conscious guests. Therefore, sustainability should be viewed as an effective long-term strategy, rather than a short-term PR activity.

NewSun Hospitality: Partnering with hotels to build a foundation for long-term growth

Sustainable growth does not have a one-size-fits-all formula for every hotel. A city hotel, resort, boutique hotel, or MICE venue will have different demand structures, revenue streams, and operational challenges. Therefore, instead of implementing fragmented solutions, hotels need a holistic approach encompassing strategy, operations, revenue, sales & marketing, staff training, digital transformation, and customer experience. With extensive experience in consulting and partnering with hotels and resorts in operational management, training, Sales Centralisation, digital transformation, and business performance optimisation, NewSun Hospitality aims to build growth foundations tailored to each asset model and investor objective. In a rapidly growing yet increasingly competitive market, the critical question is no longer “how can a hotel grow?”, but rather “how can each step of growth today build greater competitive capability for tomorrow?” This is the foundation of sustainable growth in modern hospitality. Are you seeking solutions to enhance operational efficiency, optimise revenue, develop your team, or accelerate digital transformation for your hotel? Connect with NewSun Hospitality to assess your current situation, identify bottlenecks, and develop a tailored growth strategy for each asset.

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  • Email: dosm@nshm.com.vn
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  • Website: https://nshm.com.vn/ (NewSun Hospitality)

References

  • Deloitte. (2026). The future of hospitality: Navigating new frontiers. Deloitte Insights.
  • Deloitte. (2026). Technology for sustainability. Deloitte Insights.
  • Deloitte & Mews. (2024). Humanising hospitality through technology. Deloitte UK.
  • Decision Lab. (2025). The Connected Consumer Q1 2025 Report. Decision Lab.
  • Euromonitor International. (2025). Travel in Vietnam. Euromonitor International.
  • Euromonitor International. (2025). Lodging (Destination) in Vietnam. Euromonitor International.
  • Savills Vietnam. (2025). Ho Chi Minh City Market Brief Q1 2025. Savills Vietnam.
  • Statista. (2025). Hotels: Vietnam. Statista Market Insights.
  • Vietnam Report. (2025). Top 10 & Top 5 Reputable Companies in Tourism – Hotel, Resort – Passenger Transport Industry 2025. Vietnam Report.