By Adun Okupe PhD
Whenever I see an uncompleted hotel project, or one that has been closed down, I wonder what happened and typically, I find that there are some critical questions they didn’t answer: Who will come?; Why should they come?; How often are they coming?; What is actually bringing them to this location? and Who is building and running the hotel?.
These projects didn’t fail because the teams lacked ambition, they failed the Reality Check Matrix – a tool I use to test whether a hospitality/tourism development is ready for the real world, and our African context.
Some people say it’s a chicken and egg thing; that you need hotels to attract tourists, or tourists to justify hotels. My response: accommodation without compelling reasons to visit doesn’t really translate into viable tourism returns.
I have 4 questions to gauge a destination’s appeal:
1. Tourism appeal reality: Why would anyone come here? What unique experiences, attractions, or business reasons draw people to this location? If the answer is “we’ll figure that out after the hotel opens,” then, that is a red flag for project viability.
2. Tourism demand reality: A 150-room hotel needs 38,325 room nights annually at 70 per cent occupancy (optimistic projection for a new hotel and requires work to sustain over the long-term). Where exactly are these guests coming from? Are they business travellers, leisure tourists or conference attendees? Where are they going today and why should they come to this destination? Each market segment requires different hotel design and tourism infrastructure.
3. Operational reality: Who will staff this property? What is the local talent pool? What are the supply chain logistics? How expensive is the utility infrastructure? Who is in charge of the marketing budget for ongoing promotion? (Side note: we need hospitality and tourism marketing specialists on the continent).
4. Ecosystem reality: Is there anything to do once guests arrive? Dining, culture, nature? What does transportation access look like? A beautiful hotel surrounded by nothing compelling is just an expensive place to sleep.
The tourism myth says: if we build it, they will come. The RCM says: if they are not already coming, don’t build it, yet.
The most successful tourism developments I have seen don’t start with “let’s build a hotel.” They start with “let’s understand what this destination offers and can offer, and then we can build accommodation and other facilities that can enhance that experience.”
Because at the end of the day, tourists come for experiences, the hotel is a place to rest between those experiences.
If we started with overall destination appeal, before accommodation planning, we would have: Places that people want to visit; Smarter investments and Sustainable returns.
* The contributor, Dr. Adun Okupe is the Principal Advisor, Red Clay Advisory. She is an expert on Strategic Planning, Sustainable Design, Sustainable Tourism and Heritage Tourism.
