Nigeria: Tourism Market Insights 2017
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1 6,8% 54,1% 45,9% 93,2% Nigeria: Tourism Market Insights 217 About Nigeria According to Nielson (217), Nigeria is home to over 25 ethnic groups divided on religious, socioeconomic, and political lines. The northern part of Nigeria holds much of the Muslim population, while the richer Christian population tends to inhabit the south. T R A V E L & T O U R I S M C O N T R I B U T I O N T O G D P ( ) Nigeria is the second largest economy in Sub Saharan Africa. L E I S U R E B U S I N E S S F O R E I G N V I S I T O R D O M E S T I C Oil was the mainstay of the country s GDP, but now GDP derives growth from not only spurt in global crude oil prices but also from development in non-oil sectors, such as tourism. Nigeria is rich in natural resources, however faces severe infrastructure bottlenecks and inequality in income distribution. Global Tourism Performance The number of inbound arrivals to Nigeria increases by 12% in 217(f) to reach two million trips. The largest inbound region in 217 is the Middle East with 671, trips and the largest inbound countries in terms of trips are Niger, Benin and Liberia Source: World travel & Tourism Council, 217 In 217 spend for leisure travel is expected to grow by.4% in 217 to NGN1,675.8bn, and rise by 3.3% pa to NGN2,313.9bn in 227. Furthermore, business travel spending is expected to grow by 1.9% in 217 to NGN1,443.4bn, and rise by 3.9% pa to NGN2,111.8bn in 227. Domestic travel spending generated 93.2% of direct Travel & Tourism GDP in 216 compared with 6.8% for visitor exports (ie foreign visitor spending or international tourism receipts). 1 Inbound arrivals are set to see a 6% compound annual growth rate (CAGR) during the forecast period to reach 2.2 million (Euro Monitor International, 217). According to the World Travel & Tourism Council (217), leisure travel spending generated 54.1% of direct travel & tourism GDP (NGN bn) as compared to 45.9% for business travel in 216.
2 Domestic travel spending is foreseen to grow by 1.4% in 217 to NGN2,913.9bn, and rise by 3.7% pa to NGN4,183.3bn by 227. impacted much of the country in the past few years. Visitor exports are expected to drop by 2.8% in 217 to NGN25.4bn, and rise by 1.7% pa to NGN242.4bn in 227. Nigerian Tourism Trends The country is also suffering from the declining cost of oil, which has had an impact on its infrastructure developments and government investments, despite the government s eagerness to invest in this area. The majority of tourists to Nigeria are from nearby The main outbound travel destinations include countries like Benin, Niger, Liberia, Cameroon, regional countries such as Ghana, Benin, Niger Chad and Sudan from where access to Nigeria is and Cameroon, but also destination in Western easy. Europe, the most popular of which is France followed by the UK where a large number of These are countries that engage in business with Nigerians reside. Nigeria and which have cultural ties making it interesting for leisure tourism from a cultural point An even larger number of Nigerian tourists take of view (Euromonitor International, 217). trips to the United Arab Emirates each year. 234, trips are expected to be taken to the TOP 1 COUNTRY ARRIVALS IN NIGERIA ( e) United Arab Emirates in 217(f), most of which were for business purposes, with visits to trade 25 events and conferences or for meetings. 2 2 The decline in outbound tourism however may have attributed to the positive trends in domestic travel in the country, The domestic travel segment remained strong at three million trips in 217, following a growth of 3%, this was lower than the e YEAR NIGER UK USA CHINA CAMEROON INDIA BENIN GHANA TOGO MALI Corporate travel is the second most important area for tourism in Nigeria. The main destination for corporate travel is Lagos, where a number of 4% growth recorded in 216. Nigeria has one of the highest rankings in terms of urban markets in Africa. Five Nigerian cities make the top 25 in Africa, while the country accounts for 37 cities in the top 1 (Fraym, 217). trade events and conferences attract business travellers each year, and it is also, where the majority of Nigerian businesses are located. Business arrivals accounted for 25% of total inbound arrivals to Nigeria in 217 Nevertheless, tourism in Nigeria has suffered from the threat of increased terrorism, which has
3 FOCUS: Nigeria Consumers According to Fraym: Urban Market Index (217) consumer power in Africa is substantial. In the 169 clusters researched, there are total of 2 million people living in homes with a car, motorcycle, television, or refrigerator as illustrated. Of these, 25% live in Cairo, Lagos, Kinshasa and Johannesburg, while 5% live in the top 18 cities. The report further states that the metropolis of Lagos has roughly the same sized urban consumer class (12.2m) as all thirteen large cities in the East African community (12.5m i.e Burundi, Kenya, Tanzania, Rwanda, Uganda). In total the consumer class in Nigeria s 37 cities is 41.6m. The urban consumer class referred to above are consumers who are able to live comfortably with all household amenities, including but not limited to television, electrical appliances, motorcycles/ cars etc. Generation Bump According to data developed by Fraym (217), generation bumpers are young, educated and spending Nigerian consumers. 3 Theses tech savvy and worldly consumers are more likely to travel and explore other African communities. Source: Fraym (217)
4 Indicators Number of arrivals Number of arrivals Profile of Nigerian Traveller to South Africa South Africa received a share of 7.5m tourist arrivals from the Africa market in 216. Nigeria is one of South Africa s top Africa air markets. For the year 216 there was Nigerian tourists recorded as compared to 215 (59,2). The largest share of Nigerian tourists visited South Africa for the first time throughout the period ( ). Q1 217 saw 36.6% first time travellers, followed by 3.% who travelled for the 2 nd or 3 rd consecutive time. 9.2% of the visitors recorded were visiting the country for the 1 th time or more For Q1 216 & 17 the following data has been available. South Africa received 16,247 Nigerian tourists during the period Jan-Mar 216 as compared to the same period in 217 (13,235). NIGERIAN TOURISTS TO SOUTH AFRICA (JAN-MAR ) Year 45,% 4,% 35,% 3,% 25,% 2,% 15,% 1,% 5,%,% NIGERIAN TOURISTS TO (SA) REPEATER RATE (Q ) 1ST TIME 2-3 TIMES 4-5 TIMES 6-9 TIMES 1 OR MORE ,6% 32,9% 23,% 8,5% 9,% 216 4,% 3,7% 13,3% 5,9% 1,% ,6% 3,% 17,3% 7,% 9,2% Year On average travellers from Nigeria stay in South Africa for more than 1 days. In 217 Nigerian tourists stayed for 12.7 day as compared to 11.7 in 216 and 1.8 in 215 during the same period. 4 Nigerian tourist s main motivation/ reason for visiting South Africa can be grouped into the following indicators, namely: Leisure, Business, Medical, Religion, Other. NIGERIAN TOURIST PURPOSE OF VISIT TO (SA) 13 12,5 NIGERIAN TOURISTS' LENGTH OF STAY IN (SA) (Q ) 12,7 Other Religion Medical Business Leisure,% 1,% 2,% 3,% 4,% 5,% 6,% 7,% ,7 11,5 11 1,8 1,5 1 9,
5 Value (Rand) Number of arrivals BEDNIGHTS FROM NIGERIAN TOURISTS TO THE WESTERN CAPE Profile of Nigerian Traveller to the Western Cape The Western Cape has seen over 6, Nigerian tourists from Q Q With the highest number recorded in Q Growth was at.7% from the same period in 216. The numbers are yet to grow as the figures are only looking at the first quarters from the years represented. WESTERN CAPE SHARE OF NIGERIAN ARRIVALS (Q ) The Western Cape had 11 bed nights from the Nigerian market in 216 as compared to the 144 in Conclusion and Recommendations Year The Western cape saw a share of 2835 Nigerian tourists in the Growth in Nigeria has been possible because of steps taken by the government to end armed conflicts and create a better business climate. Due to these positive changes, Nigerians earn more and spend more on products than the African average (Nielson, 217). Nigeria poses a great tourism market for South Africa and the Western Cape respectively, both for business, trade and leisure. 5 first quarter of 217 as compared to 215 (1679) and 216. AVERAGE SPEND OF NIGERIAN TOURISTS IN THE WESTERN CAPE Destination marketers need to focus efforts on securing this market through aggressive social media and other internet platforms, as Nigeria closely follows SA in terms of internet usage Year Nigerian tourists and business travellers spent on average R24 4 in 215 as compared to R15 in 216. Source: Fraym (217)
6 Online marketing is the most effective channel for attracting the Nigerian tourist. Nigerians are luxurious travelers and are lifestyle conscious, they do not follow the norm, the Western Cape should capitalize on this as this will ensure repeat visitation from this African nation. The high level of the South African education system can also play a meaningful role in attracting Nigerian tourists to the country. According to Nielson (217) over 5% of Nigeria s population is under 2 years in age, and are academically orientated, seeking places to further their education. In 216 South Africa recorded 65,1% of Nigerian tourists aged between years, with the largest group (36.2%) This reflects a strong middle-aged, working class. 6
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