A powerful message emerged during trends presentations by more than 15 high-level expert speakers at the recent Wine & Food Tourism Conference, held at Spier near Stellenbosch: a unified view that authenticity is essential in not only reaching, but converting new generation customers and making them loyalists.
Speakers and delegates attending the Old Vine Project networking function after the fourth annual Wine & Food Tourism Conference
Presenting the headline slot, South Africa’s top trends analyst, Dion Chang of Flux Trends, led an interesting discussion about the trends that are shaping tourism, especially the rise of the digitized traveler.
He outlined how the new rules of engagement have completely transformed the manner in which tourism, among other businesses, should be appealing and responding to tech savvy customers, to stay competitive and relevant in a fast-changing world. Although challenging, Chang reminded delegates of the immense opportunity brought on by technological disruption and in turn, the pivoting of business models.
“The roles have reversed. In all disrupted industries the customer now leads, while companies struggle to adapt, not only to new technology and new systems, but the application thereof. The customer on the other hand has embraced new technologies because they provide a faster, quicker service, as well as cut out intermediaries such as the travel agent or broker, for example.”
He outlined two waves of disruption, the first caused by digitization – the rise of social media, mass customization – a world accelerated by the move from analog to digital which necessitated fundamental changes in business systems and templates, and the collapse of the traditional value chain.
Chang stated that the first wave disrupted various industries, but particularly hospitality and tourism as well as financial services, transforming the core function of these businesses from a transactional relationship with their customers, to a transformative one.
“This fundamental shift has resulted in the focus of organizations moving from product- to solution-based innovation as could be perceived when looking at the on-demand, sharing and gig economies.”
Then came the second wave of technological disruption, Chang indicated, spearheaded by the internet of things (IOT), robotics & automation, artificial intelligence, big data and the emerging metaverse (virtual reality & augmented reality).
The second wave has increased the speed of change, but has also had a ripple effect on ancillary industries. “For example, the on-demand economy has altered the last mile in the customer journey, as well as supply chain management and logistics. Artificial intelligence now enables mass customization, not to mention how virtual reality is augmenting and authenticating marketing campaigns.”
Chang next focused on “The New Travel Tribes”. These new groupings of digitized travelers have a profound impact on the way in which tourism businesses should be conducting themselves in a changing world.
In this universe, there are experience-driven travelers, who are after authentic stories and less stuff; cleansers, with members who are increasingly conscious of the goods and especially the food they consume, and make their purchases accordingly; the consciously diverse, who acknowledges the need for diversity in fashion, cosmetics and marketing; pro-black business consumers, who embrace black-owned businesses; and Neo-Afro Culturists, or South African millennials who embrace traditional culture while living modern, tech savvy lives.
“This provides new opportunities for the culturally woke entrepreneur. These tribes illustrate how important it is to take into consideration the creation of diverse experiences that will provide cultural context for your various clients. Social media is the new virtual tribal council.”
According to Chang, in the experience economy, the primary question every brand needs to ask is, “Is my business Instagrammable?” He mentioned that partnering with Instagram influencers could be tricky, but that’s almost an essential part of social media marketing today. He also referred to virtual influencers, citing the example of a young, modern-day version of KFC’s icon, General Saunders, presented as this global brand’s virtual influencer.
Innovator and respected SA trends analyst, Dion Chang
He then turned the focus to the “NOline world”, which sees the lines between brands and sectors blurring.
“Various online retailers are using the data collected from their customers’ online shopping behavior and experiences to create offline stores, as well as experiences. It is no longer online or offline, but NOline. For example, Airbnb is partnering with different brands to offer overnight retail experiences that are also hospitality experiences – like Sono’s one room “hotel” in the music store Rough Trade. It can be booked via Airbnb. Other examples are Amazon and Yuppiechef, both of which now also offering brick-and-mortar shopping experiences.
“Many may think that we’re going back to the physical, but it’s just the pendulum swinging to arrive at a new equilibrium. The middle will never be the same again.”
Zoning in on the next generation consumer, Generation Z (who is currently entering the workforce), as well as members of Generation Alpha (who are already dictating what they want to their parents), Chang described them as digital natives, inhabiting the NOline world.
“They seamlessly interact and engage with the online and offline worlds without seeing any difference – this is something all businesses need to consider.
“These consumers are also ethically and morally driven so the products or means you use to reach out to them, need to mirror and resonate with their value systems. One word of advice: don’t underestimate the social justice barometer of these consumers – they are activists, wise beyond their years, whistleblower and system changers.
“Technology has changed your consumer, and your next generation customer will be even more challenging. The rules of engagement need to change, whether it is in the physical or in the virtual realm,” he concluded.
Digital marketing maven Judith Lewis, who has been ranked by her peers as one of the most influential members working in the UK industry today, echoed many of Chang’s views when she took to the stage to share some exciting insights into online and social media marketing.
She described how quickly and simply wine and food businesses can access their target audiences and improve how, what and when they communicate across multiple platforms, just by using free and readily available tools at their disposal. “Awareness needs to be boosted. By extending its reach, by better understanding trade and consumer points of contact and by building stronger relationships, South Africa’s tourism sector can more ably convert, retain, and engage more people.”
Lewis highlighted the need for stories to make an impact on today and tomorrow’s customer. “It’s the stories that stay with us. Think about social media – it’s so effective in inspiring us to travel when authentic story-telling is involved. It’s important to find your own signature brand voice.”
She also mentioned the decline in Twitter users, the rise of Instagram and online influencers, and the popularity of video in online communication.
During the PPS panel discussion to offer answers to the question of “what will drive South Africa’s wine and food tourism offering to the next level?” Jean-Pierre Rossouw, publisher of Platter’s South African Wine Guide and Rossouw’s Restaurants, contended: “South Africa is in a very interesting space. On one hand, we have a great advantage – we absorb good international practice and move forward quickly. We’re nimble. We’re leaders in wine tourism. In many ways we lead the way and have integrated opportunities and offerings. However, what we move with – trends – is also our downfall. We tend to be trend followers, not trend setters.”
Calling for accelerated innovation, he said that South Africans should not be ashamed of what they have and what they present. To add a premium to the pricing of the South African offering requires a higher level of confidence.
“When we step out with this, we already win. If you are who and what you are, you win from the start.”
Raymond Ndlovu, investment executive at Remgro Limited and co-founder and owner of Black Elephant Vintners, mentioned a stark characteristic that stands out when looking at South African wine. “There’s no problem with the product. There’s an incredible array of choice, with enough depth and complexity to hold its own in the global space. However, we need to agree on our collective product to get to premium price points to achieve growth and sustain the industry.
“We can attract the attention of the world over and beyond what’s in the bottle through authentic story-telling. We as Africans are known for our story-telling tradition. Perhaps we are still to Eurocentric in how we present ourselves, a function of the lack of diversity that we’re still working on. However, authenticity is key. With Generation Z, you have to keep it real.”
Celebrated South African chef and restaurateur, Bertus Basson, confirmed these views from a food point of view, emphasizing the need for the nation to stand proud and celebrate South Africa’s own unique food flavours.
Meanwhile talented winemaker at Môreson Winery in the Franschhoek Valley, Luca Orselli, suggested that wine producers focus more on the romanticism of wine in marketing themselves and their products. “Consumers will pay a premium for the story. It’s all about authenticity.”
Chairman of the board of the South African Sommelier Association (SASA), Barry Schofield, the final panel participant, stressed an urgent need for an investment in education and skills development in terms of sommeliers and wine stewards. “There are jobs for them, but our industry is moving faster than the amount of time we’re taking to train our sommeliers. The other issue is that they’re not sufficiently remunerated for their time and effort.” He also addressed national optimism, regional wine lists, the pricing of South African wines in restaurants, and a wine trend that he says is here to stay: the demand for lower alcohol, lighter styled wines.
Tim Harris, CEO of Wesgro (the tourism, trade and investment promotion agency for Cape Town and the Western Cape), shared an exciting vision for the Western Cape region during his audience address, highlighting the organization’s provocative “Nowhere Does It Better” campaign that underscores just how much one could experience in the small geographic area of the Western Cape – something that could be found in very few places in the world.
“Tourism is the world’s third biggest export, a significant contributor to South Africa’s gross domestic product, and a powerful platform for creating employment. We are back in business, people!” Harris said in reference to the recent drought and the resulting negative impact on tourism in the region.
He also discussed the successful creation of a resilience economy whereby other cities can now learn from Cape Town and its approach to the water crisis. “We’ve changed our behavior, it’s now instilled.” Harris explained that much could be reapplied from Wesgro and its partners’ strategy in this regard, in terms of tackling safety issues in the area – a major threat to tourism.
Next up was social marketer and digital age leadership specialist, Dave Duarte, addressing the topic of the role that technology will play in tourism in the next five years. He delved into the intricacies of innovation and the development of new concepts, products, brand and businesses in a constantly changing world.
“Pick your battles wisely when it comes to innovation, but build a culture of experimentation” he explained. “Unless you have some specific technical advantage, you’re not going to have a competitive advantage. Focus on one thing that you can really be known for.” He paraphrased Jeff Bezos, stating that as a business, you need to have two or three big ideas, and execute well on these.
Duarte regards the main driver of a new wave of technological value and connected experience as an attitude of curiosity, and greater efficiency. He stands firm that technology doesn’t dehumanize, but that it has an amazing ability to connect.
In his view, technology ultimately presents a willingness to invest and pioneer on the customer’s behalf. “At the heart of tech innovation, is better human experiences and solutions for our problems,” he remarked.
During his discussion about the current market versus the potential market, talented advertising strategist, Katlego Ditlhokwe, highlighted that brands are more than just a product intrinsic, but also a representation of values, beliefs and concepts. “Story-telling is such an effective way to get your brand identity and promise across while selling a specific product or service,” he explained while also cautioning against reflective advertising that’s so often not insights based, as well as the creation of different advertisements to appeal to diverse race groups.
What is needed with marketing strategy, he said, is a combination of logic and creativity. Ditlhokwe referenced Nando’s South Africa’s impactful #RightMyName campaign, showing how a real deep connection with one’s consumer involves much more than just a focus on the product or service offered. In this instance, Nando’s very successfully celebrated the diversity of its South African audience by running a campaign aimed at eliminating local names being interpreted as errors via electronic spellchecking.
Next up was restaurateur and chef, Fortunato Mazzone, owner of Forti Grill and Bar in Pretoria. He elaborated on effective strategies and tactics that could be employed when starting a new restaurant business, and/or managing a current restaurant operation, during tough economic times. He offered some practical tips, such as; hard negotiation with landlords in terms of rental costs, treating suppliers as allies rather than enemies, to rather look at the rands and not the cents and keep the big picture in mind, to never sell yourself cheap by offering a plethora of specials, to look after loyal customers, to invest in and value staff, and to go about your restaurant business with integrity and authenticity.
Mazzone also made the point that aspiring restaurateurs require at least 18 months of money behind them when starting a new restaurant. “Don’t go into this business if you’re looking for a place to invest your pension,” he cautioned.
Meanwhile, experiential travel, the conscious consumer, a greater focus on wellbeing, as well as township tourism, were addressed as trends in terms of the “In My Crystal Ball” panel presentation, focused on future challenges and opportunities in tourism.
Pamela McOnie, founder of Cape Fusion Tours, forming part of the “In My Crystal Ball” panel presentation, focussed on challenges and opportunities in tourism
Cape Fusion Tours’ founder, Pamela McOnie, contended that despite the challenge of safety in the country, there’s much more room to innovate in terms of food experiences that’s accessible as well as unique and original. “The world has become foodies, and people now want to learn about a destination through its cuisine and its people. Cape Town hasn’t always been a foodie destination, it’s been a work in progress over many years, and although we’ve made fantastic and valuable inroads, we still have quite a way to go to augment and widen our local flavour offering.”
The opportunities available to businesses that innovate to capitalize on trends are huge, McOnie said.
Reinher Behrens, CEO of Franchhoek Wine Valley, recommended a simple strategy to get more from one single traveler: to encourage overnight stays and to extend these to a few nights. He also referred to “tourism twinning” as a trend, whereby destinations partner up and create an alliance to jointly strengthen their tourism offerings.
Mohamed Baba of ILIOS Travel confidently stated that South Africa has a top-notch tourism assets offering incredible value, but that the skills shortage is a major concern. “The key is to know that, what we really have is the ability to develop people and create jobs,” he said.
Entrepreneur Miles Kubheka wowed delegates with his energetic talk about the disruption of industries to create and take advantage of opportunity, citing food waste as an example. “The food issue relates to retail distribution and accessibility, not quantity.” To tackle this problem, Kubheka had been involved in the development of the JustNow Food digital app to help streamline the retail food industry. “We are more efficient when moving food from one party to another through digitization,” he stated.
Highlighting the opportunity for South Africa in harnessing its share of the global tourism market, immediate past Minister of Tourism Derek Hanekom emphasized that President Cyril Ramaphosa has identified tourism as a key economic sector, and that steps are already being taken to ease visa access to the country. “Tourism growth for 2019 is forecast at 3% to 4%, with Africa continuing to outpace global performance,” he predicted.
In 2018, tourism constituted 9.2% of total employment in South Africa, almost 1.5 million jobs. During the same period, South Africa arrivals grew by 1.8% with a 5.5% increase in estimated total tourism revenue of R108.90 billion, and total contribution to gross domestic product (GDP) of R425 billion. “Important to note,” Hanekom indicated, “is that approximately 25% of travel budgets are spent on food and beverages. In many instances, food and wine might not be the main attraction, but these elements certainly make or break the main attraction.”
The 2019 Wine & Food Tourism Conference concluded with the announcement of the nine honorees of the inaugural Wine & Food Tourism Awards. They were presented with their trophies by Blacky Komani, chairperson of the Tourism Business Council of South Africa (TBCSA).
The 2020 edition of the Wine & Food Tourism Conference will take place on 30 September next year. The annual get-together is convened by seasoned tourism specialist, Margi Biggs.
For more information, go to www.wineandfood.co.za.