Stay in tune
Sashia Samira | May 07, 2011

Founded by the brains behind budget carrier AirAsia, Tune Hotels extend the no-frills approach to penny-conscious travelers on the ground. That results in budget bliss for both camps. The demand for budget carriers has irrevocably changed the way people travel. Not only is air travel becoming increasingly affordable and accessible, it has also created some healthy profit margins for Malaysian entrepreneur and head of AirAsia, Datuk Seri Anthony Francis Fernandes.

Following on from the airline’s success, Fernandes is delving deeper into the market by extending the concept into a chain of bargain hotels.  The concept was launched in April 2007 in downtown Kuala Lumpur and uses the same approach as AirAsia. By eschewing the usual frills such as a swimming pool, room service and TV, with promotional rates as low as Rp10,000 ($1.10), Tune Hotels appeals to the penny-conscious traveler.

The “pay for what you need” philosophy works on land just as it does in the air. Guests can opt for air conditioning, towels or a hairdryer, and the price of the room is calculated accordingly.  The Aston, Santika and Harris hotels are also following suit, but are bravely offering the market budget rates with frills intact. Guests at these hotels can still enjoy lounging by the pool and room service for between Rp300,000 and 400,000 per room.

Sendjaja Widjaja, CEO of Tune HotelsIndonesia and former CEO of AirAsia Indonesia says the concept is already a success. “Why should customers pay for things they don’t need?” he asks. While rates go as low as Rp10,000 a night, to get that sort of bargain they must be booked at least eight to 10 months in advance. “This is for smart travelers who plan their vacation in advance and know how to be penny-wise. We provide them with both transportation and a place to stay,” explains Wijaya.

Tune hotels are becoming a hit with young and budget-conscious travelers fromAustralia,  Asia and Europe. “Many domestic tourists prefer to stay in ourhotels. Of course, these kinds of customers are those who are out the whole day and return just to rest. I guess the  price attracts them,” says Widjaja.  Donny Handoni, sales executive of the hotels, tells GlobeAsia that at Rp150,000 a night, many foreign “flashpackers” leave their belongings at the hotel while they travel around.

Security is guaranteed, with 24/7 CCTV cameras in every corner, he says. “Guests are free to leave their belonging without feeling worried, we are not a dodgy hotel, we just have good prices,” says Handoni.  Despite its low rates, which peak at Rp500,000, Tune Hotels Indonesia earned Rp10 billion in revenue last year.

“We are hoping to reach Rp15 billion this year. Last year’s occupancy was great, nearly 80%, and this year we are forecasting an increase as we have been working on promotion,” says Widjaja, adding that Tune Hotels are set to open in Jakarta, Bandung and Surabaya, on top of two already operating in Bali. 

“We are looking at the demand and the potential to enter other cities, but we are going to build two hotels in Jakarta for sure,” he says.

 Stay Tuned

If you are familiar with the phrase “ask and it will be given,” then keep hoping. In reality it’s more like ask, pay and then you shall receive. The same applies at Tune Hotels. If you are planning a stay don’t forget the soap and shampoo because there won’t be any complimentary goods in the bathroom. A rental towel priced at Rp17,000 comes with soap and a sachet of shampoo. 

“You don’t change your towel every day at home, right? We are implementing that in our hotel. When you think you need to change then you can pay again,” explains Widjaja.  The same goes for the 24-hour Wi-Fi connection which is available for Rp55,000. You can forget the continental breakfast too, but when hunger strikes the hotels do boast a minimart. Despite all the scrimping, notes Widjaja, the beds are 5-star. “That is our slogan: Experience a 5-star hotel bed for a 1-star price.”

For guests such as Mandy and Myrte from the Netherlands, Tune Hotels suits their criteria and budget. “We don’t need TV, AC or hot tea, what we need is just a nice bed and a clean bathroom,” says Mandy, who often stays in the hotel. Her friend Myrte believes a swimming pool wouldn’t go astray. “Sometimes I prefer to stay in the hotel, sun tanning, but I guess staying in Tune I’m urged to go outside. Besides the rooms are cheap,” she says with a grin.

Grace, an avid traveler from the Philippines, says she chooses Tune Hotel for its location. “We come to Bali to shop at local vendors so this area (Legian) is perfect for that,” she says.  “It’s true, Legian is more family-oriented. Students and shoppers also love it. Kuta is more for the party people who stay up late and wake up late,” says Handoni.

Located in both Kuta and Legian, TuneHotels.com is confident about its future prospects. “We have found a niche market, just like the airline. Now people can experience a clean bed and a good bathroom in a budget hotel and fly there for an affordable price. This is the experience and the chance we offer the market together with our carriers,” says a confident Widjaja.

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