In Africa Tourism’s Great Potential, How Radisson Blu Hotels Do the Most With Less
“I am launching Inspiring Expeditions to go where people haven’t been before or go differently (..) I’m zeroing in on seeing unusual things and unusual animals while we still have them” said Geoffrey Kent to the New York Times recently. As the founder and CEO of the luxury tour company Abercrombie & Kent (350 tours in more than 100 countries), Mr Kent has accompanied Prince Charles in Oman, designed a China trip for Bill Gates and Warren Buffett, and experimented with space travel. When it came to list the very few unique places he is yet to see, the insatiable explorer said, “the Congo”.
The Republic of the Congo is widely regarded as one of Africa’s greatest gems thanks to its pristine, untouched, lush nature. As home to the world’s second largest rainforest and to some of the last populations of gorillas and elephants, the Congo is a recurrent, magnetic feature in Western popular culture from Hollywood movies to literature and comics.
Yet, for all its pure natural magnificence and its mythical status, the Congo is one the world’s least visited countries. In 2010 and 2014 the country has received as low as 194,000 and 224,000 international tourists respectively.
On the back of steady economic growth in the early 2000’s, the Congo became a rising platform for foreign investors and international events. Subsequently, the capital city Brazzaville has seen an acceleration in the construction of luxury hotels, including global brands such as Radisson Blu and Kempinski (opening soon).
But today, hit hard by the slump in the prices of oil (which represents 65 percent of Congo’s GDP), the country is in a severe economic recession. According to Unicongo, a local trade association, the occupancy rate at hotels is only 25–35 percent in 2017.
In such a dire situation, with many challenges and unknowns, how does a big-brand hotel make the most of their investment? More broadly, how risky is it to enter and operate in an untapped, unequipped, underserved market?
To find out, I have field-researched in the Congo, visited various hotspots, interviewed several tourists, and investigated inside the Radisson Blu Brazzaville.
BE ADVENTUROUS, GO THE EXTRA MILE
Brazzaville, just like ‘Congo’, is a legendary name speaking to people worldwide. Founded in 1883 by the great Italian-French explorer Pierre Savorgnan de Brazza, the city served as a headquarter of France’s African colonial empire during the first half of the 20th century. As such, it was visited by General Charles de Gaulle for the ‘Conference de Brazzaville’ in 1944.
History, landmarks, architecture are serious assets cities around the world leverage to attract tourists. But across Brazzaville, I’m surprised that its cultural heritage is so absent and its past grandeur so ignored. The only reason, I’m told, the majestic villa that hosted de Gaulle during his one-week visit is still standing, is that today it serves as the residence of France’s ambassador to the Congo. Similarly, a handful of colonial-style buildings have so far escaped destruction because they are used as offices by the current administration. There are no plaques, no signs, let alone guided visits. De Brazza’s itinerary, the 150-year French presence, the Portuguese traders’ footprint in the 1930’s, and most of the colonial legacy have been almost entirely wiped out.
“The Congo has unlimited potential and wonderful assets. You would hardly know where to start. But you basically have to build from the ground up in everything: the sites, the roads, the tours…” says Patrick Dhoore. As General Manager of Radisson Blu, he is the first and last to receive tourists’ needs-and-wants. In absence of a tourist infrastructure, he found an answer in his lifetime passion for wildlife exploration: “Odzala, the only reserve of world-class quality in the Congo is our distinguished partner. Visitors receive a full package combining hotel nights at the Radisson and a memorable trip to Odzala.”
SPOT AN OPPORTUNITY, MOVE FAST
As much as prominent public voices in local media see the country on its way to the ‘emerging market’ status, in reality, the latter has a frontier market profile:
· It is a new economy: entire sectors have been opened only recently to private capital, from telecoms and manufacturing to retail and banking.
· It has many untapped resources: in addition to tourism, metals, mining, and agriculture, are still under-developed and 60-plus percent of the territory remains untouched.
Therefore, the Congo earned the interest of frontier market investors who seek countries and opportunities where capital and expertise can yield great returns. Radisson Blu went further: it found the right time to enter and did it fast. “We came here based on a market study done in 2013–14. Back then, the economy was in shape. We opened on September 1st, 2015” says Mr Dhoore. That was just in time for the opening of the 2015 African Games (“the Olympics for African nations”).
“When I arrived here in June 2015, there wasn’t a single decent hotel. I had to put my teams in 2-stars and 3-stars because 4-stars were expensive and poor quality. I had our department managers coming from our hotels across Africa. On August 1st, I had 200 staff on the frontline. The setup process was fast-paced, even risky. We did non-stop training, tried relentlessly and started all over again. At the opening, we were almost sold out.”
MAXIMIZE THE COMPETITIVE ADVANTAGE
As a newly opened economy, possessing a strategic geography, the Congo is a purely business tourism market at the moment, appealing to capital explorers, development professionals, corporate executives and consultants from an array of sectors — pharma, agriculture, energy, construction, timber. They look for effectiveness, convenience, and reliability. This is precisely Mr Dhoore’s focus. “We have the best internet in town, we offer the largest bandwidth, for free. You’ve been around, you’ve seen the difference”.
As I’m mapping out competitors including upscale hotels clustering in a less-than-5-km radius in the heart of Brazzaville, Mr Dhoore adds “Say it’s your first time in the Congo, you may look at all these nice hotel names, but as you travel for business, you want a name you know, a host you trust. We guarantee international standards in water, safety, electricity, lifts, food, etc. This is quality other hotels don’t offer or cannot offer”.
Mr Dhoore then proceeds to show me in his office how closely he watches competitor performances and customer feedbacks via a handful of online review aggregators: “Incumbent hotels have been poorly maintained over the years. As an international chain, it’s critical that our guests continue to enjoy the benefits of their loyalty and our signature design spiced up with local influences.”
HIGH RISKS, HIGH REWARDS
The “crisis”, an everyday conversation across the country, illuminates the risk of booms and busts inherent to commodity-depending economies: “the Congo had exceptional growth rates in 2011. We entered. Today, in an economic climate turned unfavourable, the businessman has to be a real genius [to succeed]” said Mr Philippe Audouin, Director at the insurance company Allianz Congo in a recent edition of Unicongo’s print magazine.
Another risk is the limited pool of services sectors oriented, English speaking, native employees. Typically, Congolese young talents see themselves working in the oil industry or in public offices. “The schools, the resources, the fundamentals for the hospitality industry are non-existent. We had to bring in various intensive training formats tackling the basics in all specialties. Our goal is more locals, more quality, more services” says Mr Dhoore.
But as international competitors arrive, skilled workers are quickly tapped into and salaries are swiftly inflated. “This is a risk I’m ready to take. At the end of the day, I want nothing but high quality for our guests. And I took another risk: I’m covering 70 percent of the healthcare for our workforce and — hopefully soon — their families. Healthcare, lunches, holidays, social security registration; benefits that were completely new to our employees, we cover. We’re the only ones to do that.” adds Mr Dhoore.
As a result, Radisson Blu has the highest employee retention rate in the local industry.
With a fresh-minded, well-trained, best-equipped workforce, the company wants not only to remain consistent with delivering on customer expectations, but also to stay ahead of the pack as the economy shifts.
Indeed, the Congo has only one way to go: up. With support from big international development banks, the country is prioritizing tourism in a just-launched $60-million investment campaign aimed at diversifying the economy. As it develops the tourism industry, the Congo will be able to capture a share of Africa tourism’s growth, particularly preservation tourism and community-based ecotourism.
The investors who were willing to take the risk to enter a blank space, to approach challenges with humility and adaptability, to commit to the long-term, are likely to be best positioned to seize fresh opportunities and reap the largest rewards.
Patrick Gaincko is a consultant who does research and writes about African consumers. He constantly travels across Africa and regularly speaks at global conferences. His website GainXperience is regarded as an essential resource by entrepreneurs, brands and companies willing to grow in emerging markets.