Accounting group Grant Thornton says tourism can unlock significant potential if it caters for more South Africans.
In a statement this week, it said the domestic tourism industry has the potential to contribute significantly more to our economy, if it manages to expand the industry so that it caters for everyone in the country – rather than just focusing on traditional (white) tourists.
“The domestic tourism sector has provided strong support for the national industry, but it is still only focused on a limited portion of the market by offering the same traditional products to the same type of tourists that have dominated expenditure in this area for the past 50 years,” said Lee-Anne Bac, Director: Advisory Services at Grant Thornton.
She warned that this approach excludes a key part of the potential market
“Product providers assume their existing products would also be appealing to new entrants to the discretionary spending economy, when, in fact, they have very different needs. These travellers are not defined by racial demographics, but are rather differentiated by their demand for new and different tourism experiences which are not covered by the current product set,” said Bac.
She said that factors influencing travel choices for emerging local tourists – often high-earning and high-spending – include family size, value for money, food and beverage options, activities that appeal to their interests and accessibility.
The 2016 Domestic Tourism Survey conducted by Statistics South Africa showed that domestic overnight trips decreased by 11% over a year since 2015, to 42.8 million trips. Of these, only 7.4 million were leisure trips – a decrease of 13% from 2015.
Bac said one of the biggest disruptors for domestic tourism over the past decade has been the growth and improved accessibility of international travel.
“Local tourism operators have to realise that they are competing with international tourism options, to a much greater extent than in the past. Younger tourists are often inclined to travel overseas, as they perceive other emerging markets as offering better value for money and experiences than they can find on home soil. These factors become increasingly important as economic conditions tighten for consumers making decisions about discretionary leisure expenditure.”
She pointed to “a clear opportunity for small- to medium-sized black-owned businesses – ranging from adventure operators to hotel and resort groupings – to grow the available product set and to make the domestic tourism market accessible to more consumers.”
If the industry manages to grow in this manner, it would go a long way to making domestic tourism even more resilient.
“The local domestic tourism market is ripe for meaningful change which goes beyond focusing on improving B-BBEE scorecards. It is robust enough to allow for expansion that would cater for all types of tourists in different market segments, all over the country,” she concluded.