Grow My Business: The Travel Industry: Is There Light At The End Of The Tunnel?

While every industry has been affected by the pandemic in some shape or form, few have been as hard hit as the travel industry. Initially, lockdown restrictions banned travel, and since then, many South Africans have suffered a loss of income, directly impacting discretionary spending on holidays. In fact, the contribution of travel and tourism to South Africa's GDP dropped to 3.7% in 2020, a decrease from 6.9% the previous year, marking the lowest GDP contribution of the travel and tourism sector since 2005. Similarly, jobs in the travel and tourism sector fell to 987,000 in 2020. The latest hotel data from Stats SA reveals that the industry has not fully recovered to pre-pandemic levels. Despite these challenges, there is finally some light (and holiday destinations) at the end of the proverbial tunnel. Let’s explore how the industry is persevering despite these recent limitations.

Placing Emphasis on Local Tourism

In light of the challenges, Africa’s Travel Indaba has urged partners to refocus on South African tourism to return to pre-Covid numbers. One significant shift for travel companies has been to emphasize intra-regional travel. The Minister of Tourism has called for more collaboration between regions as a way to revitalize the sector, which is seen as a major driver of growth to accelerate recovery. However, this won't be easy due to barriers such as poor road infrastructure between major city centers, limited airlines, and stringent immigration policies. Rebuilding the tourism sector will also require stimulating demand through rewarding experiences that explore alternatives to mass tourism, such as sustainable rural tourism, nature tourism, and theme-based circuit tourism.

Strategies for Improving Customer Perception

Hotels and holiday destinations are enhancing efforts to promote confidence in the travel experience. This can be achieved through initiatives like flexible refund policies and clearly communicated safety protocols. Many hotels have utilized quieter months to refurbish while implementing new cleaning protocols, such as improving air handling systems and installing hard floors instead of carpeting for easier cleaning. A gradual shift may also involve reduced in-person contact with contactless check-in systems and room service replacing buffets. These measures are advertised on websites to enhance safety perceptions and attract guests by showcasing refreshed premises. While some of these changes may be temporary, they aim to instill confidence in guests to invest in travel experiences.

Attract New and Returning Customers

Now is the time to tap into the database of previous customers and focus efforts on those who have visited before. Strategies should center on reminding past guests of the enjoyable experiences they had during their last visit and enticing them to return. This could include offering returner discounts or loyalty upgrades. Simultaneously, it’s essential to launch marketing campaigns to attract new customers and rekindle interest in travel.

The Bottom Line

While COVID-19 has undoubtedly altered travel habits, the hope is that this crisis is temporary. In the meantime, the sector must do everything possible to restart economies and return society to some semblance of normality. Tourism plays a crucial role not only in rebuilding economies but also in fostering cultural understanding and bringing joy to people's lives. Although we may not see significant shifts in the immediate future, with careful management and innovation, the sector can and will recover. To fund your tourism business’s recovery strategy, contact Merchant Capital today.

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