How Indonesian online travel agents are giving stiff competition
The arrival of online travel agents (OTAs) to take on Shariah-compliant hotel operators in Indonesia has been increasingly felt.
More and more OTAs are entering the Shariah-compliant hotel market, heating up competition in the industry. OYO, a platform offering hotels and homes, is targeting 350 new Shariah-concept properties across multiple locations in Indonesia this year, Adeline Virgina Tashya, its corporate communications manager for Indonesia and Malaysia, tells Salaam Gateway.
Some of these locations include Jakarta, Banten, West Java, Central Java, Kediri, and Yogyakarta. The addition of new properties complement existing 850 Shariah-aligned properties listed in 2022. The platform featured 3,400 properties and served 13 million customers as of end of 2022.
Domestic halal tourism in the country, including mosque tours or Sunan tombs has grown rapidly, in turn propelling the demand for supporting facilities such as Muslim-friendly accommodation, which is expected to further increase. Ministry of Tourism and Creative Economy (Kemenparekraf) released a booklet, listing 230 mosques in 13 provinces, recommending some of the best mosque tourism destinations in Indonesia.
OYO also wants to expand the potential of religious tourism destinations such as the Bandung Al-Jabbar Mosque, Istiqlal Mosque, Sunda Kelapa Grand Mosque in Jakarta, Kubah Emas Mosque in Depok, and Sunan Gunung Jati Tomb in West Java, Demak Grand Mosque, Sunan Giri Tomb, Tuban Grand Mosque, and Sunan Bonang Tomb in Central Java, among others.
Adeline added that the company has invested more than $200 million in properties, including Shariah-compliant ones, across ASEAN markets (Indonesia, Malaysia, Philippines, Thailand and Vietnam). Indonesia and Malaysia have been billed as key markets within the region for halal tourism.
Other OTA players such as RedDoorz also jumped on the bandwagon. Cut Nany Indriani, head of integrated communication at RedDoorz Indonesia sees tremendous growth in the platform’s Sharia-compliant properties, scaling from 283 in 2019 to 2,000 in September 2023. This was primarily driven by a growth spurt in local halal destinations, initially restricted to locations such as Aceh and Lombok, and later disseminating to several cities such as Jakarta, Yogyakarta, Malang, Lampung, and Makassar.
In total, RedDoorz currently features 3,200 properties across 257 cities in Indonesia.
Cut claimed that RedDoorz properties are compliant with the Ministry of Tourism and Creative Economy’s regulations regarding halal tourism – that is to meet the needs and desires of Muslim tourists, such as the availability of halal food, facilities for worship, and lodging accommodations that prioritize Shariah principles.
“RedDoorz Syariah is designed to provide a comfortable and accommodating stay for Indonesian Muslim travellers. In addition to Muslim-friendly facilities, one of the main requirements for guests who want to stay at RedDoorz Syariah properties is to show a valid marriage certificate for married couples,” added Cut.
Cut said that more travellers are currently choosing Sharia accommodation due to its comfort, cleanliness, and affordability. Going forward, the platform will continue to grow its portfolio of Shariah properties in other cities including five Southeast Asia (SEA) countries where they operate in, namely Singapore, Indonesia, Philippines, Thailand and Vietnam. The company aims to reach breakeven this year in these aforementioned markets.
