In the lead up to the 2020 Arabian Hotel Investment Conference (AHIC), we asked a number of industry partners how they are transforming their business for tomorrow
With Dubai preparing to host the Middle East’s first ever World Expo in October, the UAE stands on the cusp of history. In just a few short decades, the country has witnessed an exceptional journey of transformation and growth to become one of the most popular business hubs and tourism destinations in the world.
Ongoing efforts by the government to diversify the UAE’s tourism offering through investment in the nation’s leisure and entertainment sector, improved travel connectivity and relaxation of visa regulations are just some of the factors that have helped Dubai make its mark on the world as a leading tourism destination.
The hospitality sector, in particular, has been instrumental in putting Dubai on the global tourism map. Synonymous with luxury hotels, exceptional service and some of the world’s best F&B offerings, the emirate has quickly become renowned and highly sought-after for its year-long sun, sea, shopping and unique tourism experiences.
However, as Dubai’s hospitality market begins to mature, and preferences of guests continue to evolve, we too must adapt as an industry, to match the commercial and operational challenges which will inevitably come our way.
So, what steps must we take to maintain momentum and ensure Dubai continues to broaden its appeal and reach its ambitious visitor targets? Hoteliers and developers all have a key role to play – and it starts with listening to the demand from our customers. Our industry has proven its ability to provide world-class hospitality standards, now we must learn to adapt our offerings to give travellers the type of experience they want and have come to expect.
Just 25 years ago, travellers’ choices were relatively limited, and affordability was a crucial factor in when, where and how people travelled. Less airline connectivity, little product differentiation and lower disposable income meant travel was seen as a luxury, rather than the norm. Fast forward to 2020 and travel has become more accessible than ever before.
According to the International Air Transport Association (IATA), the Middle East’s aviation market is forecast to see an extra 290 million air passengers on routes to, from and within the region by 2037. With greater air connectivity also comes significant opportunity for us as hoteliers to reform the market and cater to changing preferences.
If you look at travel patterns today, the growing global middle class with more disposable income than previous generations has given rise to a new demographic of traveller. Adding to this is the impact of technology, which has dramatically changed the way we sell to and service our customers.
Today’s traveller expects a personalised and streamlined experience across every device they use. Naturally, the primary focus for businesses of the future is how we can integrate digital technologies to enhance our guest experience, covering every touch-point.
For instance, automated check in/out services, customised environmental settings within each room, the use of the Internet of Things (IoT), and wireless data linking are now all becoming commonplace. In this era of brand apathy, the ultimate goal is to provide guests with a fully customised experience and build a connection with them, so they are more likely to return in the future.
However, innovation must not be restricted to technological advances alone. According to the Mastercard Global Destination Cities Index 2019, Dubai is the fourth most-visited city in the world. This is reflected in the robust performance of the emirate’s hospitality market, with Dubai welcoming 16.73 million visitors in 2019 alone. If we are to continue to compete with other global destinations such as Bangkok, Paris and London however, we must look at innovating and tailoring our offering in line with changing consumer preferences.
At present, the GCC hotel market is dominated by luxury, up-market establishments. With people travelling more frequently and increasingly opting for more affordable hotel options, there is a burgeoning demand for more mid-scale offerings, with PwC estimating that Dubai will require an additional 15,000 mid-market hotel keys to facilitate the demand of Expo 2020 alone.
With Dubai aiming to attract 25 million visitors by 2025 as part of Dubai’s Tourism Strategy 2025, it is imperative that the hospitality sector starts to confront this new reality in order to futureproof itself as a leading destination of choice. Hoteliers in the UAE and wider GCC must make a commitment to bridging the gap between luxury and economy and midscale hotel supply, and take a more cost-effective approach to development.
As His Highness Sheikh Mohammed Bin Rashid Al Maktoum, Vice President, Prime Minister and Ruler of Dubai once remarked, “determination, strategy and vision for the future are our real resources in the quest for excellence and success”. This is an incredibly exciting time for the region, as we stand at a crossroads of a cultural and technological revolution, with the hospitality industry at the forefront of this change.
How we adapt to this rapidly-changing landscape in the post-Expo era will be pivotal to our collective success, and I for one am very excited to be a part of the journey.