NB: This is a guest article by Nathan Midgley, a freelance writer and web editor based in Accra, Ghana.
Earlier this year I made a booking for a small, independent property called Eshu in Cape Coast, Ghana.
We reserved through HostelBookers, which sent us confirmation and took a deposit. Two days before hitting the road we called to confirm.
And after trying several mobile numbers we finally reached the owner, who said, “It is closed,” and hung up.
He meant closed for good. Some digging turned up a reference to the closure inÂ Time Out‘s 2011-12 Accra guide, published in summer 2011.
Taking into account the lead time on a glossy, perfect-bound yearbook, that indicates the property had been out of commission for well over six months at time of booking.
Of course, this is an anomaly. But it’s an anomaly in the sense of being unlikely, not unnatural.
HostelBookers official Giovanna Gentile says:
“We work in the same way as any other OTA, which means that properties add available rooms to our system and we offer these rooms to our customers. This is a system that works really well 99.5% of the time.”
When a hotel gives up the ghost, there’s a strong expectation that it will inform the OTA, as per HostelBookers’ terms and conditions.
Again, that’s par for the course: Karen Galles, senior director of market management at Expedia Lodging Partner Services, says:
â€œIn the case of a closure, hotels are encouraged to advise Expedia as soon as possible.”
But what if they don’t?
Here the problems presented by West Africa’s tech infrastructure are exacerbated by a relative lack of experience in ecommerce or emarketing relationships.
HostelBookers only entered the region in 2008, and Google only began really pushing its marketing suite this year.
On the subject of sourcing and maintaining content, Celia Casadome, director of market management for Expedia, says:
“The lack of tech infrastructure and in some cases lack of training is definitely an issue. Expedia is happy to collaborate with local tourism authorities in seminars and trainings, and we have done this in Gambia, Senegal and Ghana.”
But whether government-level seminars trickle down to the budget sector is moot, and it’s there that closures and ownership changes are more common.
Here in Ghana the little guys are feeling the pinch even more than usual as the steady depreciation of the Cedi drives up the price of goods.
And there’s also the expat factor: hostels popular with the European and US leisure market are often set up by former travellers or volunteers with little or no hospitality experience, who eventually move on or return home.
Traveller favourite Green Turtle, a glorious hidden spot on the west coast, is currently on the market so its owners can repatriate to the UK.
Even if OTAs get this end of the market on board, as HostelBookers has to an extent, there are plenty of cracks through which a relationship can slip, potentially taking bookings and trust with it.
Monitoring strategies on the OTA side offer a degree of security, but again there are fault lines specific to developing markets.
HostelBookers’ content team investigates flagged properties based on “a variety of signals” that include user reviews and the property’s own extranet usage, but West Africa is a low sales priority with low volumes â€“ fewer than 500 bookings a year for the whole region.
That means UGC feedback is limited, and the process of investigating is in any case labour-intensive. “Considering the amount of properties we have it is very laborious, and sometimes properties [like Eshu] slip through,” says Gentile.
Mark Essien, founder of Nigeria’s Hotels.com.ng, points out that the highly competitive, mobile-focused communications market can make that process even more difficult.
â€œQuite apart from the change in ownership, another pressing problem is that hotels change their mobile numbers. It becomes quite difficult to get in contact with them if the data you’ve collected is old.”
Cheap pay-as-you-go SIMs are the rule, and switching to an operator with a better tariff or service is commonplace â€“ Nigeria’s Glo launched in Ghana earlier this month with about 1.5 million pre-registered users, all of whom will be on new numbers.
Operating in the middle and upper market insulates you from these problems to some extent.
Expedia sold 40,000 West African room nights in 2011, with around 40% of that in Ghana. It focuses mainly on top-end hotels and business-friendly guesthouses in Accra, though some of the latter are still small, independent operations.
Growth figures are tasty â€“ those 40,000 sales are an increase of 150% on 2010 â€“ and it’s tempting to link them both to Expedia’s own outreach efforts and to Ghana’s nascent oil boom, putting them in a similar context to Virgin’s increased Heathrow-Kotoka frequency and the Kempinski set to open in 2013.
If it’s a case of caveat emptor further down, you could simply throw up your hands and argue it was ever thus.
But if developing markets bring out the risks inherent in selling low-end properties through an international OTA model, does that hand a measure of advantage to local or specialised players?
Hotels.com.ng’s Essien thinks so, arguing that lower labour costs and smaller scale make it possible to verify each booking manually:
“In China, bookings [for budget hotels] are usually verified by phone. This is possible because of the cheap labour there. We’re copying that model: we don’t actually tell you that you’ve booked till this is confirmed from the hotel.
“The bigger sites with huge booking volumes do not have that luxury. And even if they did, their call centres would not be willing to try calling 15 times if the call does not go through – which is something that, very frankly, is required in Africa.”
The punchline? With Eshu scuppered, we spent an extra few nights at Ko-Sa, a Dutch-run beach lodge near Elmina that pulls in relatively wealthy expats as well as backpackers.
Its en-suite huts sell out months in advance thanks to stellar word of mouth. So far it isn’t doing any online distribution at all.
The market is tiny, but it may not be quite as small as it looks from European HQs.
NB:Â This is a guest article byÂ Nathan Midgley, a freelance writer and web editor based in Accra, Ghana.