Business

Digital Innovation: A Missed Opportunity For Tourism Recovery

Entreprenuers undergoing training at The Innovation Village

Before COVID-19 virus arrived in Uganda, the Tourism sector was registering a steady rise in foreign exchange from tourists. According to the Annual Tourism Sector Performance Report for Financial Year 2018/2019, revenue rose from $1.45 billion in 2017 to $1.6 billion in 2018.

Owing to this growth, in the same report, the sector accounted for 7.7 per cent of the national gross domestic product and 6.7 per cent of total national employment through creating 667,600 jobs. 

With government committing to spend Shs181 billion in the tourism sector in the next financial year. Vivian Lyazi, The Tourism Manager at the Ministry of Tourism says that the allocation to the sector has been improving over the years however with the impact of COVID-19 pandemics on all sectors there has been spending rationalisation.  “It is specifically tight with the sector that is heavily impacted by the pandemic that led to the loss of revenues, jobs and business,” Lyazi says.

Lyazi adds, “Regardless of the circumstances, the Ministry is committed to ensuring travel and tourism are not halted. To ensure that the sector remains functional and sustainable throughout the pandemic, the ministry is building the capacity of stakeholders both in the private and public sectors and working with various partners including Uganda Tourism Board, Uganda Wildlife Authority, and Uganda WildLife Education Center to promote and implement safe travel.” 

“We are also engaging the development partners and other government agencies to develop policies and packages that cushion the sector from the adverse effects of the pandemic. Some of these are the Value Added Tax relief for hotels outside Kampala and the affordable financing lines of credit with Uganda Development Bank” She added.

Technology advancement is also at the fore-front of the Ministry agenda in ensuring the effectiveness and normalization of businesses within the tourism sector. Platforms such as Zoom have revolutionised conferencing and meetings. More advanced conference suite platforms have enabled the sector to participate in travel expenses.

Brian Namanya, the Chief Executive Officer and Founder at Tubayo says, currently their digital travel platform hosts 450 operators on the platform, a base they have grown within a space of two years. Tubayo, one of the fastest-growing digital innovation, is an online travel marketplace for users to easily find fun trips and unique accommodation spaces in Africa.

Unlike other platforms that take on tourism operators who are well established in the market, Tubayo’s Founder understands that young operators starting out in the game may not always find it favorable to go through the rigorous and expensive process of legitimising their business. With Tubayo, he chose to open the market to growing tourism operators and, in a way, offer them a chance to work alongside the big fish in the game, Namanya said.

 He added, “With our digital platform, a young tour operator is able to sell his “guiding” services and a tourist is able to have a diverse range of choices and experiences. On Tubayo.com, the young entrepreneurs in the tourism game do not only access customers or market their services, there are also nifty tools incorporated on the app like financial management tools.” 

 “Having been a player in the field for a while now, Namanya says that the difference between countries or destinations that are visited and those that are not, lies in online exposure. Digital innovation would smoothen out the process of finding information online while easing payments. All these things combined make tourism a pleasant experience and attract more revenue.”

 The challenge so far in digitizing tourism has been the high internet costs and countering sceptics of digital tourism operators. The new 12 per cent excise duty slapped on data bundles will accelerates the high cost of internet. Also, many people still believe they need to get on the ground, do their own research and arrange their own travels. Namanya says that the solution to this is building trust online. He also believes that government investment into digital innovation will go a long way.

“There is no doubt about it, digital innovation is the future for the tourism industry. It will solve most of the problems plaguing the sector,” Namanya concluded.

In efforts to further transform the sector, The Innovation Village has put in place a relief and acceleration program that will equip entrepreneurs with knowledge that would enable them to rebuild their businesses or find innovative solutions to the rising problems emanating from the pandemic.

Rahman Kasujja, Venture Associate at The Innovation Village says, “The accelerator program began with a six-day intensive program where the business model canvas was covered to equip the entrepreneurs with foundational knowledge that would enable them to track the growth of their businesses. This was supplemented by courses on innovation and human centered design to enable them turn their ideas into marketable innovations. 

Kasujja says, a lot of young people who are operators in the tourism industry do this work as a hobby and enjoy the extra buck, so the goal of the accelerator program is to ensure that they can begin to see their hobbies as businesses that they can grow and scale. “For the sector to be transformed and to survive the setbacks from the pandemic, technology will be imperative in the struggle” Kasujja added.

A digitalised tourism sector must innovate and generate new business opportunities for growth and sustainability of businesses. Travel must be made seamless and tourism, smarter. Although the sector is yet to fully adopt technologies such as virtual reality, artificial intelligence and big data in tourism, innovations such as these are very key in enabling people, both local and international, to tour Uganda’s great destinations without leaving their homes.

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