New startup launches to add zing to Southeast Asia’s budget hotel battle

Photo credit: Unique Hotels

The budget hotel battle in Southeast Asia is heating up. Inspired by the success of India-based Oyorooms, more startups are stepping in to solve the fragmented nature of this category. Rocket Internet-backed Zenrooms launched just a couple of months ago, trying to bring uniformity and discoverability to the entire experience. And the newest entrant to this space is Indonesia-based Nida Rooms.

The startup was incorporated in September but officially launched operations a few weeks ago. It’s already locked in over 1,500 hotels in four countries including Indonesia, Malaysia, Thailand, and the Philippines.

I felt this model would work very well in emerging Asian markets.

Nida Rooms founder Kanesh Avili has several decades of experience in the budget airline industry. He’s worked at Air Asia, Tiger Airlines, Spice Jet, and Garuda Indonesia. He outlines the success and growth of Oyorooms as one of the key motivators behind his new venture.

“There’s a constant stream of travelers in Southeast Asia and I felt this model would work very well here and in other emerging Asian markets,” says Kanesh.

The startup works with existing hotels by locking in a certain amount of rooms to be dedicated exclusively to them. Kanesh says this is usually around 5 to 10 rooms. It’s different from other startups such as Oyorooms and Zenrooms in the sense that the entire hotel will not be rebranded, and only a certain portion of it will be modified to meet Nida Rooms’ standard.

That’s okay, according to Kanesh, as the average occupancy rate for hotels in this category hovers around the 60 percent mark. So 40 percent of their rooms are unoccupied throughout the year – and Nida helps them cover part of those.

“It’s very rare that [the hotels] have so much demand that they’ll be unable to give us a room,” he adds.

Free wifi

As with rival startups, the focus is on a standardized experience for all guests. Kanesh says their primary concern is to ensure all travelers get “12 hours’ night sleep.” To ensure hotels meet their quality parameters, the startup undertakes an audit of each one before signing up.

All guests booking rooms through the portal can expect a comfortable bed, clean linen, attached bathroom, hot shower, cable television, air conditioning, and, most importantly, free wifi. Unfortunately there’s no morning grub included.

Kanesh says the mobile app, which launched about a month ago, already has 130,000 monthly active users. Average room booking per night is hovering around the US$45 mark, which is slightly inflated due to the holiday season. Otherwise a room is available for around US$30.