Frédéric Bardin, senior vice president at Arabian Adventures, the region’s leading destination- management company, looks at Dubai’s leisure and incentive market and speaks to TTN about what to expect in 2010, a year to get creative
How did Arabian Adventures fare in 2009? Which visitors were mainly affected and which markets are expected to show early recoveries?
I call 2009 a challenging year mostly because it was very difficult, if not impossible, to predict how it was going to be. At the end of the day it wasn’t that bad. Arrivals into Dubai have dropped but it’s not as bad as media elsewhere has projected it. We know that occupancy levels have dropped in hotels because of the drop in arrivals but also because of the additional capacity of rooms that came onto the market. There were predictions of the crisis being over in September 2009, which never happened.
In our business, it’s the incentive market that has been the most affected because a lot of companies had to cutback on travel spend as well as not wanting to be seen as going to a ‘fun’ destination, which is what Dubai is today because of the beach and the glitzy glamour title.
The UK and Germany were our largest incentive markets and we have seen a drop in those.
The leisure market on the other hand was less affected. Some markets were down and others up and we certainly had a number of people visit Dubai in 2009 that weren’t able to afford it previously.
In the first six months of 2009, we had five per cent more check-in in hotels than in 2008. We are still not a cheap destination, in spite of the recession, and hotels will have to work harder to attract leisure travellers.
Fortunately, in developed economies holidays are still a priority and a part of the lifestyle. The traffic from the GCC into Dubai was very good.
At Arabian Adventures, we saw a good turnout from Russia because we deal with very up-market clients from Russia.
What are your predictions for 2010?
It’s too early to say and I can’t predict 2010. The German travel trade doesn’t seem optimistic about 2010. I wouldn’t be too optimistic about the UK too, though there will be some traffic from these traditional markets.
Having said that, there are definitely emerging markets for Dubai which can be tapped and will yield results, like China and India. The GCC countries will play an important role in 2010.
We hope to see some recovery from Japan since it’s a huge market. You have about 17 to 18 million Japanese travelling every year and Dubai still accounts for only a small portion – hence we see the potential. With Emirates they have options for connecting flights to Egypt and the rest of Africa, which are interest markets for them.
How much has Dubai as a destination suffered because of the drop in arrivals from key markets such as the UK and Germany?
While there has been all kinds of news in the international media, people still know and want to visit iconic hotels like the Burj Al Arab and see the developments in Dubai. A lot of people will still come, because the hotels are still there, the service is still there, the sun and the beach is still there.
Dubai is also a ‘short break’ destination for European travellers. If people can travel to New York for the weekend, Dubai will always hold a place in their choice of destinations.
Dubai Airports announced 41 million passengers in 2009, so people are still travelling. The question is where they are going and how much are they spending. In a survey conducted by Dubai’s Department of Tourism and Commerce Marketing in the UK, 90 per cent of agents said their customers think of Dubai as a destination offering value for money. Not necessarily cheap, but value for money spent.
What is the key factor that will determine the future of tourism in Dubai currently?
Pricing is a key element, but not just for hotel rooms. One of the complaints that we’ve received from visitors is the cost of food and beverage, which is very expensive. This has started to change in a few hotels with hotels now offering various promotions. Some hotels have completely revised their menu and philosophy of the restaurant and some of them have dropped prices by 30 per cent.
We have a team of 10 people who are constantly communicating with hoteliers to improve visitor experiences covering rates, policies for the next year, pricing for peak and low seasons, developing specific packages for special markets like China or Japan etc.
For us the emergence of Abu Dhabi as a tourist destination is very good news because it is going to offer something completely different. There was also recent news on developing a national council of tourism and antiquities, which is something I hope will happen soon. We would like to see more promotion of the UAE as a country and see more national campaigns.
There are several marketing campaigns planned in 2010 to put Dubai back on the tourism map, including familiarisation trips for agents and media. We need for hotels to be more flexible with their terms and conditions and rates. Price always plays an important role.
What are the new travel trends you expect to see in 2010?
A lot of hotels opening in 2010 will introduce ‘all-inclusive’ rates, which I believe will be of huge interest to guests. A hotel can make a lot of money by selling that formula, keeping operational costs down too. It can mean a small discount in the room and meals, but overall you have the assurance that all the guests’ meal money will be spent at the hotel.
For the customer it defines the price of the holiday in advance and, being well-travelled, they will look for hotels which can give them what they want.
By Shalu Chandran