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When choosing a hotel in Phuket, you need to consider what you are looking for in your holiday.  If you like the hassle and bustle and want to have shops and restaurants at your door step, then you will want to stay in the heart of Patong.  If you want the shops and restaurants within walking distance, you could still stay in Patong but try hotels like Seaview Patong, Burasari or Amari Coral Beach so you have a bit of space.  For the more relaxed area try Karon Beach, which is a beautiful beach and has the shops and restaurants but on a much lower scale and slower pace.  For total relaxation try some of the outer beaches like Kata Noi Beach and Kata Thani Beach Resort.