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Agoda pins hopes on Asia's domestic tourism to drive revenue

BANGKOK (Reuters) - Asia-focused online travel agency Agoda is counting on a revival of domestic tourism in parts of the region to help it weather the coronavirus pandemic, its top executive said on Monday.

The logo of Agoda online travel agency is seen at their office in Bangkok, Thailand, October 5, 2020. REUTERS/Chayut Setboonsarng

Thailand, Vietnam and Taiwan are among the top markets where domestic tourism activity was returning, chief executive John Brown told Reuters in an interview, reflecting their success in containing outbreaks.

With international travel restrictions in place to halt the contagion, the company is relying on domestic markets for its revenue, such as Thailand, where local bookings were up 20% from last year, he said.

Thailand in April banned commercial flights and foreign tourists, but has been offering travel incentives locally to try to fill that void.

Its resort island of Phuket will from this month start receiving a limited number of long-stay visitors from countries deemed low-risk, who must undergo quarantine.

Thailand tmsnrt.rs/3cYUtF2 has recorded just 3,590 confirmed cases with barely any local transmission in months. Vietnam tmsnrt.rs/2SrCP3j has seen just over 1,000 cases in total, after it quickly contained a second outbreak in August.

“People who can’t go overseas are substituting that with domestic bookings,” Brown said, adding that travellers were booking higher quality hotels and travelling to new places.

Prior to the crisis, domestic travel accounted for half of Agoda’s bookings.

The pandemic, however, is incomparable with other crises and the company in May cut 1,500 jobs, leaving it with 4,000 employees altogether.

“We’re at a lean size right now and we can survive the storm indefinitely,” he said, adding that no further cuts were anticipated.

Brown expects travel to return to pre-crisis levels shortly after coronavirus vaccines become available, due to pent-up demand, but said business travel may not rebound so quickly as companies became more familiar with virtual meetings.

Singapore-based Agoda, founded in Phuket in 2005, said its advantage over rivals comes from its relationships with Asian hotels and its share of inventory from parent company, Booking Holdings Inc.

Reporting by Chayut Setboonsarng; Editing by Martin Petty

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