Tourism: Club Med Will Expand into New Market With First South Africa Resort

resort

After a decade of planning, Club Med has confirmed plans to build its first resort in sub-Saharan Africa. The global resort operator has signed a memorandum of understanding (MOU) with a local partner, as yet unnamed, to construct a resort north of the coastal city of Durban, in South Africa’s eastern KwaZulu-Natal (KZN) province.

While the finer details have not been disclosed, it’s expected the new resort will offer upward of 350 rooms, with extensive conference facilities on-site. It will be situated on a 30-hectare coastal site, six miles from King Shaka International Airport. Emirates and British Airways both offer direct flights to the city.

But perhaps more interesting than “what” is the “why”: Why has Club Med chosen South Africa, why KwaZulu-Natal, and why now?
The expansion into sub-Saharan Africa certainly fits with Club Med’s aggressive strategy.

“Club Med’s development policy, and the tradition of Club Med, is to open three to five resorts each year. That is the plan globally,” explained Olivier Hannaert, managing director of Club Med Southern Africa.

It’s been slow off the mark when it comes to Africa though. Of the 69 Club Med resorts across the globe only five are situated in continental Africa, with none south of the equator.

‘WE CREATE THE MARKET’
The planned resort ticks the “Africa” box, but the warm seas, tropical reefs, and established demand for coastal resorts would suggest Kenya or Tanzania — particularly the island of Zanzibar — are the more obvious choice for growth. Why South Africa?

“Yes, it’s natural to open a resort in Zanzibar, but our competitors are already there, and in Kenya we have not yet found a property that fits with our expectation,” said Hannaert. “We believe Club Med is a strong enough brand to open a resort where nobody has opened a resort before us.

We create the market; we create the destination. South Africa makes good sense because of the combination of bush and beach experiences. We also have an office in South Africa, and the domestic market is strong.”

Within South Africa it’s the Western Cape province that draws the bulk of inbound and domestic tourism, but its cold, wet winters make it a highly seasonal destination unsuitable for a large resort needing year-round occupancy. KwaZulu-Natal also offers the benefit of combining a beach destination with the “Big Five” safari reserves in the north of the province.

CATALYST FOR DEVELOPMENT
“The KZN north coast offers year-round sunshine and is accessible as a self-drive destination,” said John Ridler, spokesperson for tour operator Thompsons Holidays. “This will make the Club Med experience more affordable for local travelers and will be excellent for incentive travel. Club Med will no doubt also attract international visitors which will expose South Africa to a much wider audience.”

Local government officials have certainly welcomed the large-scale development.

“As a world-class tourism product, this landmark development will attract international visitors and invariably contribute to foreign direct investment,” said Ravi Pillay, the provincial government executive for human settlements and public works, speaking in May at this year’s Travel Indaba, the continent’s largest travel trade show. “This project will serve as a catalyst for accelerated tourism-related development on the KwaZulu-Natal north coast.”

But that migration of tourism investment to the north could also spell bad news for the city of Durban.

“Over the last few years we have seen a major shift in the tourism nodes on the east coast. There have been very few new developments in the Durban area,” noted Charles Preece, operations director for the Federated Hospitality Association of Southern Africa on the east coast.

“An investment like this Club Med one, even further north, is further evidence of this shift away from the city… [it] will make it harder and harder to fill the existing hotels in Durban.”

BURGEONING DOMESTIC TOURISM TRAVEL
While there is sure to be strong domestic and long-haul demand for the proposed resort, Club Med also has its eye on a whole new market, introducing the brand to a continent of potential clients.

“African citizens are starting to travel inside Africa. If you want to educate them and encourage them to travel outside Africa you need to offer them opportunities to discover the brand,” added Hannaert. “We do believe that the size of the [outbound] market will change with a resort here in South Africa.”

Once African travelers have enjoyed the brand in Africa, so the strategy surely goes, they’ll be tempted to upgrade to other Club Med resorts further afield. Smart move.

Richard Holmes
Source: skift.com

Share our story:

Leave a Reply

Your email address will not be published. Required fields are marked *