Apps help AirBnBs eat into hotel market share, says report
Travellers are opting for more affordable accomodation offerings that are now easily accessible on their smartphones.
The latest figures from Statistics South Africa’s Preliminary Tourist Accommodation report November 2024 reveal that the country’s tourist accommodation sector saw a 12.1% increase in income in November 2024 compared to the same period in 2023.
According to the report, this growth is largely driven by a rise in hotel stays. But, the report shows, the industry is also continuing to evolve with the increasing influence of booking apps.
HOW 2024 COMPARES TO 2023
In November 2023, income from accommodation had grown by 18.1% year-on-year, showing a slightly higher rate of increase than in 2024.
The main contributor to the 2024 growth was the hotel sector, which recorded a 13.3% increase in revenue.
This is a notable jump from the 10.3% rise seen in October 2024.
Also, guesthouses and guest farms, which had seen a decline in September 2024, bounced back with a 13% increase in November.
Caravan parks and camping sites saw the most significant rise at 26.8% compared to last year.
Overall, the total income for the tourist accommodation industry grew by 9.4% in November 2024, compared to the same month in 2023.
According to the report, “Income from accommodation increased by 12.1% year-on-year in November 2024, the result of a 4.1% increase in the number of stay unit nights sold and a 7.6% increase in the average income per stay unit night sold.”
The numbers indicate positive growth, with hotels still remaining as tourists’ accommodation of choice.
But, the industry is changing in ways that could shift these trends in the future.
The stats show that booking apps are gradually helping Airbnbs and alternative accommodations chip away at what was once exclusively the hotel industry’s market share.
THE IMPACT OF BOOKING APPS ON ACCOMMODATION TRENDS
Over the past few years, online booking platforms like Airbnb, Booking.com, and Expedia have transformed the way people choose where to stay. These platforms offer travellers more flexible and often more affordable options compared to traditional hotels.
Airbnb, in particular, has increased competition in the accommodation sector by providing access to private homes and apartments at various price points.
This has led to a shift in consumer preferences, with more tourists opting for self-catering and short-term rentals instead of traditional hotels.
According to the report, “Other accommodation, which includes lodges, bed-and-breakfast establishments, and self-catering units, grew by 9.0% in November 2024, contributing 3.1 percentage points to overall accommodation growth.”
Hotels are still the dominant force in the industry. They contributed 7.8 percentage points to the total 12.1% rise in accommodation income in November 2024.
However, the stats indicate that occupancy rates across hotels have remained relatively stable.
The reason why revenue was up is because growth is being driven more by increased room rates rather than a rise in the number of stays.
The report highlights, “The average income per stay unit night sold for hotels rose to R1,608.6 in November 2024, up from R1,535.2 in October 2024.”
THE CHANGING COMPETITIVE LANDSCAPE
Guesthouses and boutique accommodations are feeling the pressure from Airbnb-style listings, which offer travellers unique and often cheaper stays. At the same time, many hotels have partnered with booking apps to remain competitive.
Caravan parks and camping sites saw a massive increase in revenue, indicating that more tourists are opting for budget-friendly, outdoor experiences. This could also reflect the growing trend of eco-tourism and nature-based travel. The report states, “Caravan parks and camping sites saw a 26.8% increase in income from accommodation in November 2024, making it the fastest-growing segment in the sector.”
TOURIST NUMBERS
Airports Company South Africa (ACSA) reported that it processed 3 705 778 passengers in December 2024.
Meanwhile, the latest Stats SA International Tourism December 2024 report showed that in December 2024, there were over 3.4 million people entering or leaving the country.
Of the foreign arrivals at our airports and terminals, 97.7% were visitors, with the majority being overnight tourists .
WHAT THIS MEANS FOR THE FUTURE
The data suggests that while traditional hotels remain strong, alternative accommodation options are gaining traction. Booking apps are reshaping consumer behaviour, and businesses in the tourism sector will need to adapt to stay competitive.
With tourism expected to grow in 2025, accommodation providers will have to balance affordability with quality service to attract travellers in an increasingly digital and price-sensitive market. “Seasonally adjusted income from accommodation increased by 1.3% month-on-month in November 2024, following a decrease of 2.9% in October 2024,” the report notes, indicating that while short-term fluctuations exist, the long-term trend remains positive.
As South Africa’s tourism industry continues to evolve, businesses must embrace digital transformation, diversify their offerings, and prioritize customer experience to remain relevant in a rapidly shifting market.
WHAT HAS YOUR EXPERIENCE WITH BOOKING APPS BEEN LIKE?
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