The hotelier operates 59 hotels across South Africa and is gearing up for refurbishments and expansion of investments into solar. Photo: File
CITY Lodge says its “life is hard. check into easy” tagline, which resonates with the daily struggles of South Africans, brings a fresh approach to acknowledging the complexities faced by the market.
The “life is hard” tagline is a departure from marketing campaign messages of many hoteliers that are all about glitz and glamour aimed at high social media appeal.
City Lodge said it had learnt the hard way that it had to be realistic about the struggles faced by South Africans in their daily life. Take, for example, high interest rates, elevated inflation and a volatile rand that are eating away at the value of what’s in South Africans’ pockets.
“There is also trust and relationship, and an understanding of where their market is at: Life is hard. Check into easy,” said Colleen Goodman, the marketing manager for the company.
Goodman said hotels in South Africa were selling much more than just rooms. “They are peddling daydreams that are meant to draw us in because they’re so removed from everyday life.”
It was refreshing that the company brings in a refreshing approach to marketing hotels.
“We have deviated radically from this model,” added Goodman. “Our new positioning and campaigns speak directly to the banal, workaday frustrations that wear us down. It’s subversive in that this hotel group doesn’t pretend to be apart from the world. It insists on being a part of it and attuned to real people’s real problems.”
The hotelier operates 59 hotels across South Africa and is gearing up for refurbishments and expansion of investments into solar. For its 2023 full year, City Lodge raised revenues by 55% to R1.7 billion, with headline earnings per share leaping 452% to 30.3 cents after cutting debt funding by 50% to R300 million.
Although costs had gone up due to higher occupancy and utility prices, City Lodge says it is currently in “robust financial health” especially after lowering debt. Cash balances stand at R328.3m.
“We’re optimistic for 2024, focusing on refurbishments and solar expansions. Positive trends in occupancy and a refreshed brand message position us well for continued success and growth,” said Goodman, group marketing manager for City Lodge.
City Lodge has grown its food and beverage segment which now contributes 17% to total revenue. Bulelani Ngcuka, chairman of City Lodge, said the operating environment was currently punctuated by an economic slowdown, heightened load shedding, and subdued business confidence.
In the past year, City Lodge had noticed a significant uplift in foreign tourists visiting South Africa, “accompanied by increased domestic business and leisure” travel.
“Our occupancy rates have shown robust growth, surpassing even pre-pandemic levels, a testament to our ability to respond, adapt and thrive,” he said.
The Covid-19 pandemic had radically transformed the travel and leisure sector, forcing operators to adopt new approaches and to bump up their offerings under one roof as a way of raising revenue and earnings.
Strangely enough, though, the pandemic was “good for business with more people opting for the chain for leisure and business” travel.
“The group has invested heavily in refurbishing their hotels to offer an accessible but premium option for a new generation of budget-conscious traveller,” said Goodman.
“In a post-pandemic world, the very nature of travel and hospitality continues to shift as remote working has allowed people to mix business and leisure travel,” she added.
To remain competitive in such a market, City Lodge had to strengthen its “top-of-mind awareness and positioning in the market to increase consideration and stays” for the new generation of business and leisure traveller.
Steph van Niekerk, the executive creative director for TBWA, the agency that worked on the City Lodge campaign, said: “We wanted to steer away from a traditional film to create a budget-friendly, easy-to-produce film construct.”
The City Lodge campaign videos feature dirty sheets and load shedding in a realistic manner that reflects the challenges that South Africans are undergoing.
The decision to feature scenarios depicting the dirty sheets, camping and loading in the television commercials for City Lodge was meant to “resonate with the real-life frustrations and everyday challenges” that its customers face.
“By showcasing these relatable yet humorously exaggerated situations, we’ve struck a chord with our audience, emphasising that City Lodge offers a respite from such inconveniences. This approach has been a game-changer for us because it diverges from the typical escapist imagery of the hospitality industry,” said the company.
City Lodge’s share price was unchanged at R4.75 on Friday. It has risen 43.07% over a three-year period.
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