Having recently stepped into the hotel industry with our new brand Home* Suite Hotels, I am frequently asked about our positioning in the tightly contested accommodation space. For a start, we are strong believers in the capacity of this country and the upside potential of tourism. South Africa has much to offer and we have the capability of achieving the numbers too. One only has to look at a country like Croatia that reports statistics of 20 million visitors per annum compared to our two million, to understand the vision.
The accommodation industry, specifically Airbnb, is receiving a flurry of attention lately, with an outcry from the hotel sector for government regulation. These “home-stays” are purportedly threatening the livelihood of traditional hotels and bed and breakfasts. These concerns have been taken seriously: the Tourism Amendment Bill gazetted on 12 April 2019 includes amendments such as limits on the number of nights a guest can stay in a paid-for home share, prices a host can charge for accommodation, and regulations for zoning restrictions.
Airbnb is a gigantic force in a dynamic travel industry. Clearly, the “experiential” stay is an appealing attraction to accommodation seekers. These properties are often in a homely suburb, with local authenticity, exuding a warmth contrary to the feeling of large hotel “lostness”. The downside from a marketing point of view, however, is that people occasionally find homestays a bit unpredictable – you may not be certain what you will get. The scenario may be too intimate or the host may be guilty of taking the “sharing thing” too far. Any Airbnb hopper will admit to a few unexpectedly dodgy bookings from time to time.
We had to devise a clear strategy to determine the character of our hotel brand. After countless hours of research (everyone has a strong opinion on hotels!) with some of the brightest brains of the hospitality industry, we’ve come up with what we believe to be the best of both worlds. We have taken the best of Airbnb, that homely feeling, that kind of suburban locale, and added all the sophistication, security and pleasantries of a more traditional hotel. We’ve taken a strong customer-focused stance, determining what each guest actually wants. Sometimes room 1879 on the 18th floor or breakfast buffet eggs aren’t everyone’s cup of herbal tea. The success of Airbnb shows the appetite that matches our thinking – take care of the guest while making her feel “at home”.
From my experience, innovation is a good business strategy. At Kulula, for example, we leveraged off the internet and a fun brand personality to create a whole new category of air travel. With the SLOW lounges, we dumped sterile airline lounges with triangular egg mayo sandwiches and made a space that entices travellers to rush to the airport early.
Our Home* Suite Hotel brand aims to recreate the businessperson and fussy leisure traveller experience: From no check (your mobile phone will open your door) to Hypnos beds (used by the Queen!) to scrapping of the mini chocolate on your pillow in favour of a well-stocked help-yourself larder. Most important though, we’ve brought together a magnificent team who love to serve our guests. We’ve created a home that, we hope, is nicer than your own.
I’m not sure that extensive regulation is the solution to the hotel sector woes. Surely, Airbnb, much like low-cost air travel, is bringing an injection of new travellers into our country, people who would not ordinarily have the budget or the inkling to stay in traditional “catered” hotels and bed and breakfasts. Whether we call today’s travellers “millennials” or “wanderlusts”, their preferred “sharing” concept is something we must embrace. The spin-off for our tourism industry can only be positive – we’re living in an “experience” economy. Let’s embrace it.
The hotel sector is guilty of oversupply in certain markets, certainly in some city centres. Hitting occupation targets can prove a challenge, I’m sure, but I’m not convinced that’s the result of Airbnb and the likes. This is a cyclical business.
I do believe, however, that focusing on boosting our tourism numbers (let’s get a bigger slice of the one billion global tourist pie) and being open to hearing the customer will make certain that there is a seat at the table for everyone. BM