Survive the COVID crisis in the tourism and hospitality industry

Doing business during and after COVID-19 is tough. But the tourism and hospitality industries have been hit the hardest.

The COVID Crisis has changed the market fundamentals. Foreign travel is severely restricted. Airlines are filing for bankruptcy.

We spoke to three top tourism product movers and shakers with links to South Africa to discuss the issues tourism and hospitality businesses are facing during the COVID crisis. 

If you are in the tourism and hospitality industry then you need to watch this video. There are some really great insights and ideas on how to pivot your approach and develop new business models.

Businesses have changed business models

Ian Morrison, sales manager of Rovos Rail,  Schalk Enslin the  host manager of the Pezula Hotel in Knysna and Karen Carter, an owner and marketing manager of a number of guest houses in Seignosse and the Dordogne are in France give their opinions.

All three have changed business models,

The market has new requirements and tourism and hospitality business’s have had to pivot and redefine their business processes..

If you’re in the hospitality business there are a number of gems here. The discussion is nearly an hour long but well worth making the time.

Changing the business model

Schalk Enslin is the general manager or as he prefers to be known, the host manager, of Pezula Hotel and Resort. This is a high end luxury product is in the tourism hot spot of Knysna on the South African Garden Route. 

Faced with immediate and catastrophic losses of revenue as his international clients cancelled booking en mass after the lockdown was announced, he had to look at the options available for a post Covid business model.

Survival mode kicked in. He divided his staff into two teams and made sure that only one team was on duty at a time. This was to minimise a potential skills shortage if one of the teams had to go into voluntary isolation.

Then they took the doors off the entrances to the public bathrooms. This reduced the number of contact points for guests who no longer had to touch door handles to enter the bathrooms.

Then they took the Blue Ocean Strategy of saying what can they eliminate in order to offer better safety for staff and clients.

They closed the restaurants. And in the restaurants place they opened a deli. Here guests could order or collect meals and return to their rooms which are equipped with microwaves and cutlery.

Because Pezula Hotel is the jewel in the crown at the centre of a residential golf estate Enslin advertised the deli to the many residents via electronic newsletters. Some of the residents had  chosen to sequester themselves at their holiday homes during the country wide lockdown.

It took a few days for the Pezula Deli to sell three loaves of home baked bread for instance but they persevered and the deli now shows a growth of over 300% month on month.

Some of the towns residents were calling past to buy or  were  ordering meals to be delivered.

As hotels were opened to business travellers and then for leisure purposes (initially only provincial travel was allowed) Enslin developed a super cheap product of only R500 per person sharing per night. 

However with this highly reduced rate, the services were cut back as well. Guests were required to service their own rooms. They had to make their own beds and cleaning materials were provided.

This borrows from the already accepted AirBnB model. Unusual for a high end hotel but one that satisfied Enslin’s need to ensure guest and staff safety. This way he was able to ensure rooms were let and staff could get paid.

Enslin also made this experience very different. Touch points were eliminated. All booking were confirmed online and payment had to be made in advance through bank transfers. 

The only touch point with the guest was handing over the room key on arrival. No paperwork, no credit card processing.

Enslin thereby eliminated the need for receptionists. The former receptionists became call centre operators. He introduced the notion of a curated stay. 

These call centre operators would phone each guest, explain the new procedures and offer to book excursions, golf, hikes and some of the safe attractions that were available in Knysna.

As a result many guests chose to extend their stay by an additional two days.

In mid August when interprovincial travel was opened he already had a business model which was tried and tested on the Cape Town market which they’re able to apply this business model  to the Johannesburg market.

They were successful in attracting a whole new category of guest in a safe and innovative manner. Creating true blue ocean opportunities.

Similarly Karen Carter was able to pivot her guest house business’s. Her main market pre Covid was the Brits but with the lockdown that market evaporated overnight. So she pivoted and marketed to the French locals. They. were unable to travel out of the country and were looking at alternatives. Carter is exploring new markets by feeling the response of millennials to stays in her properties as well.

Ian Morrison shares with us the many safety measures Rovos Rail are applying to give guests the necessary confidence to start luxury train travel again. 

An enlightening conversation and one where we can all take lessons from.

At The Online Marketer we firmly believe that a digital first, physical enhanced strategy can set your business apart from the competition.  We look forward to continuing this conversation with role players in other industries.