South African hotel groups are not keeping up with their international counterparts who are launching products that are suited to emerging segments of travellers. This is according to Wayne Troughton, CEO of hospitality and property consulting firm, HTI Consulting.
Speaking at a recent Fedhasa Cape event at the Private Hotel School, Alan Diaz, Senior Vice President of Laureate International Universities, said segmentation was a key driver for the hospitality industry.
He pointed out the differences in taste and requirements the CEO of General Electric, Geoff Imhoff and the CEO of Facebook Mark Zuckerberg would have when travelling. “One would want privacy and functionality while the other would most likely be looking for something a little more edgy with the possibility of networking with other guests,” he explained.
Diaz says that globally some hotel groups have realised the need for different products and are “slicing and dicing” their products to meet the needs of different segments.
Troughton says South African brands will need to evolve if they are to keep up with the international brands that are targeting specific markets and seeking opportunities to enter the South African market.
He says: “Brands in South Africa are continuously evolving to try and meet the needs of different market segments, however they have not evolved to the extent of international brands. Brands such as Starwood, Rezidor and Hyatt have introduced new, funky brands to cater for the new, young and upwardly mobile travellers who seek different experiences to traditional tourist markets. Each has launched brands to cater specifically to these needs, including Starwood’s Aloft brand, Hyatt Place, and Rezidor’s soon-to-be launched Radisson Red.” 
According to Troughton, the aforementioned brands are exciting and dynamic and offer contemporary, urban experiences at an affordable price. “All of the new international brands have funky and hip designs that hold high appeal among the youth. Technology is at the forefront of the brands.” As an example, he says Radisson Red will offer a mobile application that will enable guests to check in, order food and drinks, book a taxi and order flowers through an online concierge. Hyatt Place offers self-service check-in/check-out kiosks with touch-screen technology, among others 
Troughton says the only brand in South Africa currently targeting this market is Protea. “The Protea Hotel Fire & Ice! brand is urban and hip and targets the youth and trendsetters. Protea’s targeting of the youth is a step in the right direction, however the technology element is not as evolved as those of international brands such as Radisson Red, Aloft and Hyatt Place.”  
He says this is a lost opportunity for the South African market. “International brands are eagerly seeking opportunities to enter the African market and South Africa is generally used as the jumping-off point. As these new funky brands enter the market, South African brands will have a lot of catching up to do if they are to gain the loyalty of these young, trendy travellers who will become the drivers of corporate, leisure and conferencing demand in the long term.”

Nicholas Barenblatt, Group Marketing Manager for Protea Hotels, says while Protea was doing well catering for various market segments, to secure the future of the industry, the group needs to put more focus on the “future traveller” also known as the millennial traveller. “We’ve been making changes to the way we work at corporate and hotel level to ensure that we remain relevant and grow with them,” he says. 
Barenblatt says some of these changes include integrating Protea’s overall marketing strategies across traditional and new media as well as aligning the group’s social identities with the travellers’ through offerings such as filtered and reusable glass-bottled water rather than plastic bottles, offering Relationship and Fairtrade coffee, and making hotels more environmentally friendly when refurbishing properties. “Key criticial, though, is our offering of free WiFi at our properties. That’s a deal-breaker for Gen Y travellers and they will make their accommodation choices based on that one single element,” he adds.
Barenblatt says due to the diversity of the market travelling inbound and domestic SA market, it makes sense that hotels ensure they are differentiating the hotel offering per market segment from both a marketing and guest experience perspective to maximise their fair share as opposed to thinking a ‘one size fits all approach’ will suit all segments.  
According to Diaz there is still more to come in the segmentation space. He says hotels are looking at introducing female-only wings that offer a higher level of safety and security and that they should consider the specific needs of Chinese travellers. “Clients have different needs and preferences with passions, personality, type of business and finances dictating the hospitality experience they are expecting and willing to pay for,” he said.