Strong potential for luxury travel in sub-Saharan Africa

By Time of article published Apr 6, 2017

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Business has begun to shift its concentration from established markets to the emerging market environment, the result of the low-growth economies of Europe and the United States since 2008, coupled with the rise of a larger middle class in various emerging economies in Asia and Africa.  These trends are evident across market groups, and are certainly apparent in the field of luxury travel.

The New York Times Luxury Travel Conference, held in 2016, provided insight into the potential for luxury travel among the population of Asia.  Asian travellers now have far greater purchasing power owing to the rapid economic growth seen in the large markets of countries like China, India, Indonesia and Singapore. As a region, Asia Pacific is likely to experience the fastest growth in outbound expenditure in the world from now until 2020.

The outlook for luxury travel in other regions is also positive.  Strong growth is anticipated for 2017 in the US luxury travel market – a product of the likely boost to the economy following the Presidential elections.  In large parts of Africa, too, the expectation is that the market for luxury goods is set to grow, with Nigeria and South Africa dominating the African outlook.  According to a report put together by Deloitte into the luxury goods market, Nigerians constitute a large proportion of the world’s top spenders.

“This set of factors means that there is substantial potential for the growth of luxury travel in Africa,” comments Danny Bryer, the Director of Sales, Marketing and Revenue Management for Protea Hotels by Marriott®. “Of course, the ability to deliver to this market depends on various factors applicable in particular states – things like the existing infrastructure and services, and the level of co-operation between the private sector and governments.”

To realise the potential of this type of travel, service-providers and tourism authorities need to develop a better understanding of what the market is looking for. A significant element of this is the need for a focus on the millennial population of Asia Pacific, which accounted for more than half the world’s millennials in 2016.  This is crucial since the millennial age group is fast becoming the travel market of today’s world. According to euromonitor, this group has a clear preference for luxury travel because of their affluence and aspirational outlook.  “We know that these are people keen on adventure travel and on new experiences, and these are features that sub-Saharan Africa can definitely exploit,” says Bryer.

The same is true of the growing middle class in a number of regions of Africa: they are aspirational, they have disposable incomes, and travel is fast becoming of interest to them.

Adventure travel already has a presence on the sub-continent through safari experiences, horse trails, and cycling adventures, among other things, but there is plenty of space for new experiences to be developed.  With so many untamed rivers, undeveloped coastal areas, and a plethora of wildlife, the opportunities are definitely there.

“While the luxury market is fairly well-established in parts of East Africa and South Africa, the industry can establish itself far more in many other areas on the continent,” Bryer says.  “Governments must work together with airlines, hospitality and tour companies, and the construction industry to identify and develop sites suitable for the luxury traveller looking for a different experience.” 

Bryer believes that the time is ripe for Africa to benefit from the potential for the growth in luxury travel - but co-operation among all relevant parties is core to this being realised.

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