The prevailing message throughout conversations at the Web in Travel conference held at Cape Town’s Innovation City in mid-March was that technology has the power to transform the travel industry. But whether it’s AI, e-commerce, or payments technology being deployed in Africa it will require unique thinking to cater to its various markets and customer demands.
Christian Bombrun, CEO of Digital Platforms for MTN said that 287 million people access the internet through mobile in Africa. With good network coverage which is growing “super-fast” in Africa and smartphone penetration of 55%, mobile connectivity dominates in the African market.
This dominance is also reflected in mobile service providers’ foray into other digital services such as financial services, and marketing.
While mobile is definitely king, Bayo Adedeji, CEO of Wakanow, Nigeria’s largest online travel platform, says that in the African market, operators still need to consider a hybrid business model in which people have the ability to shop online, but also to deal with a real person.
“45% of our transactions originate online but people want to see who they’re paying,” he said.
Expedia’s global Path to Purchase research found that in the 45 days leading up to travel, 80% of travellers used an online travel agency (OTA) 61% used a search engine, and 58% used social media for inspiration.
But, added Adedejoi: “In Nigeria, which is the second largest market in Africa, only 20% of customers are online”. Ease of payment is also a major issue with just 4% of his customers paying by card.
In other emerging markets, household income has played an important role in the growth of online travel.
Ross Veitch CEO of online booking platform Wego said: “In China, across South East Asia and India, the real key for travel generally, and online travel specifically to take off was when incomes went above $10 000 per household per year. In the African context, you’ve got the added complexity of really poor (air) connectivity across the continent so people are paying more to travel.”
Meeting customers where they are
Jonathan Ayache, CEO of Lift Airline, said meeting customers where they are, was an important learning curve for him, having come from Uber, where transactions would all take place in a single app that they had to download.
“We had a very big focus on our website and the experience on the website and thankfully people came in and said we need to focus critically on distribution. What I’ve realised is that people want to book the way they want to book. Our focus as an airline is to be in as many places as we can, so that however you want to book as a customer, you can get a Lift ticket”.
According to Louis van Zyl, Managing Director of Trans-End Africa a South African tech company specialising in travel, over the next six years, 90% more travel agencies will become online agencies.
“What we are seeing is the agency that is going to be able to produce a ticket at the lowest cost is the one that is going to win. That’s where online does play a role. If there is a commercial proposition- the lowest cost, and when I say cost I don’t only mean in terms of money, but in terms of process, if you can have someone go to one place and get everything they need, that is the golden egg”.
