Waking up Africa to online travel – a wide-open space

With the rise of the low-cost carrier in Africa it is getting easier - and cheaper - to book a flight online but in the hotel world it’s not. But that could be changing, writes Pamela Whitby

“If you go into a travel agent in Nairobi today and ask to book a room for a weekend in Harare there will be a bit of head scratching and then a few phone calls to find a hotel. It won’t be simple,” says Bruce Tapping, chief executive of Africabookings.

But Tapping, who recently returned to his home country Zimbabwe, after a nine-year stint in China followed by five years in the UK, is on a mission to change this.  One of reasons for this is the rise of the low-cost carrier on the continent.

The first pan African low cost carrier was FastJet, which from its base in Tanzania’s capital Dar es Salaam has grown to a carrier flying from eight destinations including Harare, Johannesburg, Lusaka and Kilomanjaro. As well as flying internally between popular destinations like Victoria Falls and Harare Fly Africa, another LCC based in Zimbabwe, is aggressively expanding its regional footprint.

Meanwhile, in South Africa, FlySafair, which took to the skies in October last year, had an almost immediate impact on competition. Russell Jarvis from online travel agent, TravelStart, says they have “noticed a trend where airfares on previously monopolised routes have come down significantly since last year”.

Interestingly, those routes where there was a marked decrease are on routes where South Africa’s newbie has a presence. According to TravelStart data, consumers paid 39% less for a flight from Cape Town to George, stop on South Africa’s Garden Route, in January/February 2015. While the popular commuter route from Johannesburg to Cape Town was lower, consumers were still averaging savings of 16% at the same time last year.

Whether it’s B2B or B2C, I believe that now is the time for Africa’s hospitality industry to wake up to being online

Bruce Tapping, CEO, Africabookings

So hopping around the continent or within countries more affordably – and booking those places online - is becoming easier but finding a place to stay online is not.

“Whether it’s B2B or B2C, I believe that now is the time for Africa’s hospitality industry to wake up to being online,” he says, adding that “we absolutely believe we are at the start of a curve to educate hotels.”

The question to become the hotel guide for Africa requires a two-pronged approach:

1.      To be visible online so that relevant distributors can see you

2.      To actively manage rates if, for example, a low season isn’t performing as well as it should.

This is a gap that Africabookings is aiming to fill. While the firm does have a consumer facing operation – with 2,000 hotels already available across 17 of the continent’s 54 countries – the real opportunity is in the B2B space.

And what Tapping wants to do is help hotels distribute their properties in all the right places – think Expedia and booking.com – and to provide Africa’s offline travel agencies with an electronic bed bank, along the lines of the travel trade service Hotel Beds.

“We are concentrating on directly sourcing inventory and we do this through Africabookings representatives on the ground in countries across Sub-Saharan Africa signing up the hotels and negotiating commission for us,” he says.

Aiming high the firm has a target of 15,000+ hotels and lodges across the continent. While the OTA for Africa is targeting all hotels, the independents are vitally important, as more often than not they are the ones with no clear distribution strategy.

Pricing it right

Another important issue is the one of pricing. Many hotels in Africa struggle with pricing strategy, and with the rise of the mid-market mainstream traveller this needs to change. There are already a large number of high-end world-class lodges catering to the super-rich but, outside of South Africa, those pricing themselves for the middle-end of the market are few and far between.

This is partly down to the fact that this sort of traveller is not yet a frequent guest in countries like Zimbabwe, Zambia, Malawi and Bostwana. But that is changing. And with South Africa recently introducing a complicated new immigration law requiring any minor under the age of 18 to travel with an unabridged birth certificate, in what is said to be a bid to curb child trafficking, international travellers may look elsewhere to avoid the hassle.

These travellers are coming but hotels need to give them an incentive.

 Says Tapping.

Understanding how to price for this middle market is something that hotels in Africa really do need to address. So for a startup that was recently joint runner up in an EyeforTravel Startup Village competition there is everything to play for.

In the coming weeks we’ll be looking at the opportunities for tours and activities in Africa – and let’s just say, the Chinese are coming!

Join us in Dubai to hear more about the opportunities in Africa - EyeforTravel MIddle East, Africa and India Summit, December 2015

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