While independent traveling and backpacking have been trending in Vietnam for the past decade amongst the younger generations, luxury domestic tourism is, in many ways, still in its infancy.
However, with the steady increase in GDP per capita over the past few years, the middle and upper classes are growing fast. The spending patterns of these classes are also beginning to shift. A decade ago, luxury spending meant buying expensive, imported consumer goods and building large, ornate houses. Now people are starting to include luxury travel experiences in their spending plans.
Many urban Vietnamese people spend most of the year at the office, leading hectic work lives that often extend into the evenings and weekends. The majority of labor contracts adhere to Vietnamese labor law, which permits employees only 12 days of annual leave outside of the public holidays. Due to demands at work, many Vietnamese people cannot afford to take long vacations even if they have the financial means to do so.
Now more than ever, working Vietnamese are aware of their non-renewable asset, which is their leisure time, and this has lead to increased demand in domestic luxury experiences. And as summer rolls around, it is time for domestic tourists to hit the roads.
Predicting this trend, many larger companies have made investments into the luxury tourism market. They have spread along the coastline of Vietnam, from the traditional domestic tourism havens like Nha Trang and Danang, to the familiar and good value destinations such as Thanh Hoa, Vung Tau and Halong Bay.
Now more than ever, working Vietnamese are aware of their non-renewable asset, which is their leisure time, and this has lead to increased demand in domestic luxury experiences.
FLC Samson Golf Course (Photo credit: FLC Group)
One example is FLC Group, whose Sam Son Beach and Golf Resort in Thanh Hoa opened in 2015. A resort complex that includes an 18-hole golf course, two distinct hotels with several restaurants, beach-side villas and bungalows, and expansive conference facilities, Sam Son Beach and Golf Resort is also a mere 2-hour drive from Hanoi.
Sam Son Beach doesn’t feature on any tour itineraries for foreign tourists, but it is a hotspot for wealthier residents of not only the Vietnam capital, but also Hai Phong, Vinh and the provinces surrounding Thanh Hoa. FLC Group is clearly targeting domestic tourists from these parts of the country.
Premier Village Resort in Danang (Photo credit: Premier Village Resorts)
Larger corporations such as VinGroup and SunGroup have also staked a claim in luxury tourism for the domestic market. At the beginning of the year, VinGroup completed its new 5-star resort, Vinpearl Golf Land Resort & Villas in Nha Trang. SunGroup will also follow suit with Premier Village Resorts in Danang and on Phu Quoc Island.
Competition has helped to drive down the price, and although 5-star ratings remain dubious in Vietnam, it is undeniable that luxury holidays – even if they don’t yet reach international standards – are becoming increasingly accessible for Vietnamese people.
Savills and CBRE Vietnam forecasted that 2016 will be the year where Vietnam becomes the top destination for luxury tourism investment from both domestic and international investors.
“In 2015, Vietnam’s GDP increased by 6.68%, with a huge shift from agriculture to construction, hospitality and services. This positive result has turned Vietnam into one of the most attractive destinations to invest in luxury real estate and hotels in 2016,” Mr. Marc Townsend, Managing Director of CBRE Vietnam, insists.
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