No matter how much the West tries to estimate the size of the African market, the Hotels.ng founder says, it will never be accurate.
A lot of people are starting to formulate theories and ideas about Africa and how its large market can be tapped into, but most of it is largely conjecture, Mark Essien, founder of Hotels.ng, the largest online hotel booking portal in Nigeria, said during a talk in Jordan recently.
And it’s nobody’s fault that so little is known of the vast continent: some of the really useful data are found locked away in non-comparable statistical yardsticks that nearly never allow for benchmark comparisons. As an article on the UK Guardian newspaper puts it: “[African] surveys are not done in the same way [as in Europe, for example], which makes comparing countries and combining data from different countries very difficult – and illustrates how hard it is to know the real number…’
This is a problem Mark believes African entrepreneurs are currently addressing, deliberately or unwittingly. Speaking at The Middle East & Africa Duty Free Association Tax-Free World Association (MEADFA TFWA) conference in Jordan, Mark Essien said, “Take Nigeria for an example. Before Hotels.ng, the estimated number of hotels in Nigeria in official publications was between 2,500 to 3,000. We have found 7,000 hotels already, and continue to add 50+ more hotels weekly.”
The true size of the African Travel Market
Nigeria is considered the largest growing travel markets in Africa, with a GDP of $514.96bn in 2013, a population of 181 million people (51% of which are internet users) and over 600,000 tourist visits annually. These numbers can be found in any publication about Nigeria’s market.
But these huge numbers are not the numbers anyone should be looking at, Mark says. The numbers are only relevant when measured along two parameters: income and sophistication, numbers that correspond to the category of Africans referred to as the ‘educated middle class.’
For Hotels.ng, a cursory observation of the number of Nigerians who use Facebook, fly by air and their total online expenditure on hotel bookings is a subset that is a more useful metric to gauge the size of the Nigerian market, and by extension, the African market.
The ‘Facebook users’ metric measures the level of ‘sophistication’, airport travel suggests high-income travelers, and the total online hotel spend is an aggregate metric for both sophistication and travelling propensity.
India and Brazil as Ideal Landmarks
The good news is that although we could do with more data about Africa, it is possible to predict reasonably accurately the future of African travel.
“The similarities between the Brazilian and the Nigerian ecosystem were what first drew me into the dynamics of the travel and tourism sector. While Hotels.ng was still in the idea stage, I studied India and Brazil, and observed the successes of Online Travel Agencies in those countries.
It was a simple thought: if it could be done there, what stops it from happening in Nigeria? Time has shown that the answer is: nothing.”
The distinct similarities between the Brazilian travel market and the Indian one can be used to predict the future of the Nigerian travel market, which is still a few years behind.
“Nigeria is currently in the 2004 stage of the Brazilian market,” Mark observed, “and ten years from now, the size of the Nigerian market will be half of what Brazil’s is currently. In that time, we would be equal in scale to what the Indian market currently is.”