The international tourism industry has struggled hard to battle declines in turnover, as the effects of the global recession linger on. The global financial crisis and the subsequent consumer behavioral change has had a significant adverse effect on the tourism industry across the world – demand has diminished, visitor spends have steadied, and costs have increased. The tail end of the financial crisis has hit South Africa and the tourism industry hard, perhaps initially diverted in the run-up to and during the World Cup.
Tourism is a major contributor to GDP, nationally and internationally. In Cape Town alone, the international visitor industry spends some R14bn per annum and at least 298,000 people are directly employed in tourism. The sobering reality is that at the current slow recovery rate of about 3-4%, Cape Town will only reach 2007 tourism visitor and revenue levels again by 2014 – representing a cumulative loss of R1.5bn to the sector over 7 years. Many other sectors are facing similar challenges, but in a region dependent upon tourism for such a large part of its economy and job market, Cape Town cannot remain passive and rely on the city to market itself.
Faced with an urgent need to respond to this environment, Cape Town Tourism CEO Mariëtte du Toit-Helmbold is calling for a new approach: “To date, market conditions have allowed us to be reliant on leisure tourism as a key focus area. In this competitive time, we cannot afford to take the view that the ‘a city sells itself,’ nor can we continue to be perceived purely as a place of natural beauty. It is absolutely necessary for destinations to actively and continuously present themselves to potential visitors with a strong brand positioning and compelling message to create sustainable demand from a cross-section of markets.”
At the cornerstone of Cape Town Tourism’s proposed tourism brand repositioning is the idea that cities are considered to be the new super-brands of the twenty first century. Said Du Toit-Helmbold: “Successful cities of the future will be stand-out urban centers seen as the most liveable and enjoyable places on the planet, delivering benefits to residents and visitors alike. For many people, to escape does not always mean a wilderness experience, but rather to explore new and different cultures. Cities are now the epicenters of modern, living culture. They are the hotspots for urban travelers who make up 70% of the world’s travelers.”
Cape Town’s market share of world tourism is less than 0.18% with a 0.3% share of the global urban tourism sector. Added to this, the destination is challenged by its long-haul status and, in light of this, the city is a small competitor in an overcrowded field. Said Du Toit-Helmbold: “Cape Town has some wonderful attributes – it is iconic, complex, and multi-faceted. However, to visitors, these attributes are not self-evident, and for us to unleash this urban wealth, the offer to potential visitors must be made continuously and compellingly.”
With national tourism marketing still focusing predominantly on wildlife and natural beauty as the central theme, cities receive very little exposure in international campaigns. The World Cup provided the world with a different perspective of South Africa, showcasing its cities – its growing infrastructure, people, and vibrant cultures. However, little has been done at a national level to capitalize on this marketing legacy, post the World Cup. A joint marketing alliance between Cape Town, Johannesburg, and Durban launched at Indaba this year will focus on urban tourism and lobby for a more representative marketing exposure of urban South Africa.
Cape Town Tourism believes that its city’s urban identity, innovative outlook, entrepreneurial spirit, academic excellence, and pioneering medical and science sectors must be added to the brand palette in order for Cape Town to effectively compete in the domestic and global market. Beauty is no longer enough to create the kind of demand to sustain year-round economic growth and job opportunities.
Du Toit-Helmbold is quick to caution against abandoning traditional source markets and leisure-focused tourism marketing, but calls for a new focus which is inclusive of business and domestic marketing themes.
Commented Du Toit-Helmbold: “We are committed to driving and implementing an inspirational brand for Cape Town rooted in our story and the evidence of inspiration found within this exceptional and complex city. It is an inclusive process that involves citizens, tourism, business, academia, events, and the knowledge and innovation economies of Cape Town to play a key role. The brand proposition of inspiration allows for multiple messaging and alignment with consumer behavior and sentiment.
Mariëtte du Toit-Helmbold concluded: “If we do not act decisively now, our industry and the economic well-being of our city and people are at great risk. If nothing is done, or if we neglect our strong tourism markets, the city and tourism businesses will not generate effective returns from the significant capital investments that were made prior to the World Cup. If we don’t proactively engage in a new marketing and branding strategy, we run the risk of being positioned nonetheless by our competitors, our critics, and the media – most likely to our disadvantage.”
Read the entire business case study at http://www.capetown.travel/industry/news/news-entry/the_business_case_for_tourism_and_a_strong_brand_for_cape_town/ .