Nigerian Travel Startup to Open African Tourism Markets to Africans
Event Africa Contributor 22/02/2018 Industry News
One of the many difficult things about traveling within the continent for Africans is the sparse pool of affordable hotel selections available for booking. It’s not that these hotels don’t exist, it’s that very few online booking platforms have enough information on such hotels.
Global travel booking platforms with operations in Africa often list only the most expensive hotels in a bid to capture foreign business travelers and luxury tourists which make up a sizable portion of Africa’s international arrivals. But Hotels.ng, a Nigerian hotel booking platform is looking to plug that gap and is expanding its service Africa-wide. It now lists nearly 27,000 hotels across the continent.
While other platforms mostly focus only on high-end resorts and luxury hotels, Hotels.ng will be looking to provide average consumers with a wider range of options of moderately priced hotels. “That gap is huge,” Mark Essien, Hotels.ng CEO, tells Quartz.
Since launching in Nigeria in 2013, Hotels.ng has listed over 10,000 hotels in more than 300 cities. That process involved mobilizing over 500 ad hoc staff to visit and validate the hotel addresses and also take photos that potential customers can view to help them make booking decisions. Essien says the company will look to replicate that process across the continent. While the first phase of the expansion will touch on every country in Africa, Essien says the scale of consumer demand will determine which cities to deepen operations in.
Essien says the expansion is because “conditions are right in terms of market development.” One of those conditions is the recent progress recorded in visa policies among many African governments with more nations adopting visa-free or visa on arrival policies for Africans. But regardless of these milestones, Essien says “a lot more effort is needed” as existing travel complications within Africa still makes it “unattractive” for Africans.
Hotels.ng’s revenue model is based on taking commissions on bookings on its platform. The company is regarded as one of the success stories of Nigeria’s tech ecosystem. In 2015, it raised $1.2 million from Echo VC, a Lagos-based venture capital fund. According to Essien, the company became profitable and raised additional capital last year but declined to give details of the funding.
In addition to a continental hotel booking platform, Hotels.ng is also launching a flight booking component in partnership with TravelStart, a Nigerian online travel agency. The flight booking platform will provide more “localized options” and make it easier to book flights across the continent, Essien says.
Scaling and targeting a wider addressable market on the continent is usually a major goal for African startups and founders, but so far, very few have. As Hotels.ng joins a small club of startups which are pan-African not just in name but also in operations, Essien is banking on the team’s experience in Nigeria. “We have a lot of experience doing this,” he tells Quartz. “For a newcomer it will be difficult but for us it will be manageable.”