Despite inflation, South Africa’s hospitality sector is enjoying the fruits of a global shift to high-end, experience-driven travel, significantly boosting “revenue per available room” (RevPAR).
According to Room Raccoon’s SA Summer Hospitality Report, RevPAR improved by 11% from summer 2023 to 2024, with occupancy and average daily rate ADR rising 10%.
Data also revealed that tourism numbers for the Mother City surged with Cape Town Tourism CEO Enver Duminy revealing that the overall occupancy rate in 2023 was 68%, a 9% increase from 2022, with RevPAR improving by 22.7% in the same period.
International arrivals at Cape Town International Airport increased by 50% while the city saw more than 1.3 million travellers from outside Africa last year.
The Room Raccoon report found that airport shuttles, spa treatments, picnic/dining boxes, bottles of MCC/wine, and game drives were the top ancillary revenue generators leading to the conclusion that despite many nations battling with higher inflation, the situation has yet to curb traveller spending on captivating experiences.
According to the data, there has been a notable change in the age of international travellers seeking luxury stays in South Africa as until a few years ago, most of these tourists fell in the 55-plus age bracket, however, that has changed.
Catherine Schulze, managing director of Cape Town’s five-star Steenberg Hotel & Spa, Bistro 1682 and Tryn restaurants, said that as tourism has become more experience-driven, more people in their 30s have entered the high-end market.
“It’s more about quality than quantity now. Where previously people might have split their money over different holidays, they now put it all into one trip where they can hire the best cars or stay at the finest hotels.
“They are looking to spend more time with loved ones or as friends travelling together. There is more multi-generational travel as well. People are very conscious of the value of time,” she said.
Schulze added that she does not doubt that remote work has been instrumental in driving up tourist numbers as working in a beautiful setting in another country, knowing they can still stay on top of what is happening at home, is a lure few can ignore.
Demand for Steenberg’s spa services corroborated with Room Raccoon’s findings on ancillary revenue generation. Schulze said this again aligns with the change in the luxury travel space, where there is no longer a “mad rush” to tick items off a bucket list.
“Today’s travellers want to pamper themselves with a relaxing treatment, sit on a terrace enjoying a glass of wine, or celebrate an occasion with loved ones and they are only too happy to upgrade to more luxurious and spacious rooms to meet these needs,” said Steenberg.