African brands step into new era with local feel
African brands step into new era with local feel
06 AUGUST 2020 7:35 AM

Hoteliers of newer brands in Africa see the pandemic as an opportunity to resonate locally and regionally to cater to guests’ desires for simplicity and meaning.

GLOBAL REPORT—New hotel brands in Africa will display local characteristics, not international ones, at least for those on the cutting edge, according to sources speaking at the recent virtual conference Africa: Hospitality Tomorrow.

Sources said the biggest breakthroughs are often made during nerve-wracking times such as the COVID-19 pandemic, with some new brands that previously did not exist swiftly becoming multibillion-dollar enterprises. Airbnb and Uber were both founded following the financial crisis, and hotel brands such as CitizenM developed during that period, too.

In a panel titled “Developing independent hospitality brands in Africa right now. Seriously?” moderator James Stuart, owner of hotel consultancy Stuart + Partners, said it is during tough times that functionality and simplicity often return.

Mark Chabari Nyaga, director of real estate investment and development for Cordon Developers, Nairobi, said building a brand of your own lets you target the clientele you want.

“Going with an international brand is a safe way, but not necessarily the right way. You have to be very specific with this from the get-go and you can build something special,” he said.

There is also an issue of pricing, panelists said.

“In Nairobi, the hotels that went with the international brands pre-COVID-19 were in a rate war as they were all largely the same and commoditized,” Stuart said.

Juliet Njogu, founder of hotel brand The Social House, said in her Nairobi hotel she decided to have four different food-and-beverage outlets, which raised some eyebrows.

“It was a saving grace, as that is what today is keeping us alive,” Njogu said. “The rooms are dead, so if we had gone with a Hilton, for example, we would be closed. It would not allow us that many outlets for 83 rooms.”

Nyaga said he also came up against such arguments.

“The brands did not really understand the market,” he said. “Their focus was on getting us international clients, but our strategy depended on a blend of local and international, so (with the international brand’s way) it would have been a business hotel, not a holiday one. Theirs was the idea of serving a particular clientele, not a particular location.”

Paul Muturi, CEO of another Nairobi-based brand, Upendo Golf, said this gap in understanding should allow more African hotel entrepreneurs that drive into doing things themselves, but that does not mean a total rejection of others ways of doing business.

“We are a resort, so we looked at what Disney has done, especially (Disneyland Paris),” Muturi said. “Our main conclusion was do not have what you do not need. Brands have to come to us and offer us something in return. It is not going to be a box deal.”

Muturi added he still is in the process of considering specific brands to work with.

New era
Africa is in a prime position to create truly memorable brands, said Bill Barnett, CEO at Thailand-based consultancy C9 Hotelworks.

“COVID-19 will accelerate trends already here. It will bring us back to repurposing,” he said. “We do not need to change but to make great properties out of what already there is, such as local crafts. We now have time to think about things. Too many things get in our way as customers.”

Barnett said Asia showed this promise and style in past decades with such brands as Shangri-La, Dusit, Amanhotels and Banyan Tree, which he said had a visionary style or a single, dogmatic leader.

“It’s a developer-driven business,” he said. “You cannot depend on a brand to do that; it needs that single vision. Even if you build a branded hotel, vision is still key. The developer is still the developer. Hotel chains rarely will give you that.”

A rise in staycations and less international travel might result in a reset in continental African air carriers and intra-continental flight routes. Travel in the continent has made huge strides in the last 20 years, panelists said, but that could be improved and made more economical.

Panelists said there remains a pull between the safety of a brand and the desire to do something truly unique and potentially more satisfying and significant.

“I have seen more of Europe than I have of Africa, so I would love to see more regional travel here, for it to be as easy as it is in Europe, and for us running hotels locally will also have them regionally,” Muturi said.

That thinking might see international brands become more interested, but panelists said such brands generally still look at upstarts such as themselves in terms of competitive sets, which is what they are good at doing across 50 to 100 cities.

Barnett said such thinking might miss a business opportunity, especially in this odd period.

“This crisis will teach entrepreneurial spirit and ask what do people want to buy in any neighborhood, and what can you sell them?” he said.

Njogu said her company wants to expand out of “niche needs.”

“We have another brand in Kenya, which got a different name (from Social House) as it was a different product with a different spirit,” she said.

She added that “the idea is to create a brand that is a vehicle to curate and calibrate experiences.”

Cordon Developers’ Nyaga said more product flexibility is needed “in an attempt to re-attract lost traction.”

“I am hoping to see a more revolutionary notion as to what we call a hotel. Redefining space for a new way of life,” he said.

Njogu agreed.

“Be agile, adaptive and have a focus on the local market,” she said. “Go back to question what the guest needs and to thus be relevant to that.”

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