South Africa’s travel sector still has a future despite tough local economic conditions

Economic Conditions
4 min read

Flight Centre Travel Group South Africa, one of South Africa’s largest travel companies, says a blended travel strategy is key to retaining both the leisure and corporate travel customer of the future. Proving that South Africans are still travelling despite tough economic conditions, the group is entering their 2020 financial year with record-breaking results.

“Flight Centre Travel Group South Africa is very happy to report that we ended our financial year on 30 June 2019 with double-digit growth in sales and record-breaking results,” says Andrew Stark, FCTG Managing Director Middle East and Africa. “All of our 6 brands, Flight Centre, Cruiseabout, Flight Centre Associates, Flight Centre Business Travel, Corporate Traveller and FCM, showed growth which, from an economic perspective, is a very good result.”

Stark cites the company’s strategy as key to their success.

Retail travel has to be online and offline

In the leisure travel space, a blended approach, incorporating online channels with traditional retail shops, is the only way to be successful in a changing retail world.

“We give the customer the choice on which channel they want to interact with us. They can engage on mobile, online or in-store,” says Stark. “We’ve seen customers search, compare options and book online if they want something such as non-complex flight routings.

“But offline, our network of over 115 retail outlets have also performed well and we’ve seen good demand from customers wanting to book face-to-face with a travel expert in store.”

Stark says that there is still a high demand for local, international, cruising and package holidays, specifically all-inclusive package holidays.

“It’s important to ensure you’re speaking across the board to all South Africans. Our client mix has changed and we’ve worked hard to ensure that we’re engaging with new traveller markets, really speaking to the traveller who perhaps hasn’t travelled before and ensuring that our offering is meeting their needs.”

Corporate travel forecast

FCTG has reported an exceptional year for the group’s corporate brands: Corporate Traveller, Flight Centre Business Travel and FCM Travel Solutions.

“We know the outbound corporate market hasn’t grown and we’re drawing market share away from our competitors,” says Stark. “We’ve invested in our 50-strong corporate sales team, the largest in the country, over the last year and it’s born fruit. This has allowed us to retain a high proportion of our corporate customers.

“No doubt times are tough in the corporate space, but as long as you meet customer expectations offering good service, great pricing, a hybrid of technology offerings and 24/7 availability, you can hold on to the corporate customer.” Stark also cites providing corporate customers with credit, which helps corporate cash flow, as helpful.

New technology and online booking platforms have been welcomed by corporate travellers, alongside personal service.

“We launched Sam, a mobile app which is essentially a Travel PA in your pocket. Over 500 corporate companies signed up for the mobile app since we launched it in the South African market. Our blended approach to travel means we know the value that our service-based business model adds when complemented by technology to drive further efficiencies for our client base.

Reward and recognition of staff

In the leisure and corporate travel spaces, investing in people has never been more important. 

“We’ve achieved an all-time-high percentage of staff retention, with the company seeing a 50% increase on prior years.”

FCTG advises that offering the right benefits for the workforce and striving towards a work/life balance is important.

“We have ranked as one of Deloitte’s Best Companies to work for in South Africa for 14 consecutive years, which positions us as an employer of choice. We’re continually improving and our engaged workforce is one of the main reasons we’ve enjoyed continued success over the past five years.”

Stark says that there appear to be fewer and fewer good jobs available for prospective employees. “We haven’t seen as much job-hopping over the past year, as we have in the last two to three years.

“We continue to invest in our people and haven’t slowed down on reward and recognition,” says Stark, naming the Flight Centre Global Gathering event as one such example.

From 12 to 14 July, over 130 South African Flight Centre staff joined the 3000-strong global FCTG top achievers to be recognised at this annual event, held in Los Angeles and Las Vegas this year.

“With Mark Wahlberg as the keynote speaker and Calvin Harris as the DJ, the event and these individuals resonated with our company culture of reward and recognition,” says Stark.

“We’re looking forward to the next financial year in 2020 and to continue to meet the travel needs of over a million South African travellers,” concludes Stark.