The Emirate is growing well with its diversification strategy with Dubai Expo 2020, the launch of Warner Bros World and Dubai's first Theme Park, and is drawing visitors from around the world. With so many changes already in motion, the trends that propel the hospitality industry are coming into full effect. These hospitality industry developments are not the cause or impact of a single route phenomenon, but different socio-economic criteria in Dubai to describe the industry.
The hospitality industry in Dubai is a significant contributor and a major employer to the UAE’s economy. According to Knight Frank’s, it is estimated that the hospitality industry contributed over Dh 150 billion to UAE GDP (4.6 percent of GDP) and created approximately 570,000 jobs (4.8 per cent of total employment) in 2017 UAE hospitality sector 2018' report.
Now recognised as one of the top luxury destinations globally, Dubai has gained a reputation for attracting wealthy tourists. Dubai International Airport, the world’s leading international airport, had seen passenger numbers rise from 57.68 million in 2012 to 88.24 million in 2017, a 53 percent increase. More travellers are expected to visit Dubai in the years ahead, inspired by conventional hotel scores and sustainable, customised and culturally aware experiences.
Dubai Tourism has announced that its hotel inventory is expected to rise by 11% in the next two years, and by the end of 2019, 132,000 rooms are expected to be operational in the Emirate. With more and more visitors flying in, Dubai is among the top 10 destinations to visit and more than ever, even restaurants are not far behind in the space. They are rising at a tremendous rate by the government, focusing on the hospitality industry.
Dubai has around 260 customers per restaurant, not because of the lack of tourists to the Emirate, but because of the number rising. You may be wondering in such a competitive space what are the main factors driving the growth of the hospitality industry in the Emirate.
Here is a list of top 10 hospitality trends from various segments that we believe are boosting Dubai's hospitality industry’s success.
Top Trends in the Hospitality Sector in Dubai
Changing attitudes and expectations, be they social, economic or technological, generate trends that guide an industry. The same is the case for Dubai's hospitality industry. The sector was jointly reshaped by numerous socio-cultural, economic and technological developments.
Social Trends Accelerating Hospitality Industry in Dubai
Social developments include a shift in people's attitudes due to changes in lifestyles triggered by interaction with different human concepts, such as globalisation. Top Social Trends transforming the hospitality industry in Dubai are:
1. Healthy Food
The nation has been on a healthy path, and no exception is the Middle East. The Health and Wellness Trends 2018 Gulfood Global Outlook Study cites a rise in demand for organic goods, nutritious food, label scrutiny, and environment-friendly food. In the Middle East, health and wellness are projected to rise at 7 per cent, compared to 3 per cent globally in the next five years.
2. Extended Home Concepts
Dubai has always been a tourist destination, so it has had a decent degree of foreign brand penetration, but the pattern has changed lately. With an emphasis on high quality, more and more homegrown brands are emerging and entering the hospitality market. It is seen as a symbol of a maturing market and a rise in the value of home-based foods and home-based ideas that diners are increasingly searching for.
3. Regional Aromas
Dubai has seen a rise and fall in interest in various cuisines, and the new trend is modern and traditional to capture the hospitality industry. Regional flavours are becoming a favoured choice in Dubai with more homegrown concepts.
4. Takeaway Choices
As the city expands, people get busier, and the internet becomes more than a standard feature, takeaways, and home deliveries reach the trend list. An exponential increase in options for food and distribution, which saves both time and money. Food delivery apps are on the rise, and greater acceptance is seen for real go-to foods such as meal plans.
Economic Trends Driving The Hospitality Industry
Economic patterns are not necessarily due to a shift in people's financial status and a change in people's consumption habits and attitudes. The main economic trends affecting Dubai's hospitality industry are -
1. Quick Casuals and Pop-Ups
Tourists visiting Dubai are not class-bound anymore. There is more to a tourist destination. The number of families and middle-class tourists coming in. Pop-up restaurants and fast casuals are gaining popularity and are rising.
2. Deal for a Hotel-Restaurant
Independent restaurants and bars are working together as the next big trend that has shaken the hospitality industry. Both hotels and restaurants have chosen to work together in an atmosphere where restaurants can put their business insight into the new F&B trends on the table. The hotel can provide a world-class experience to give their clients a more diverse experience. This development has profound economic ramifications, opening up new possibilities for the hospitality industry and reducing the final brunt of costs involved. The Dubai hospitality industry is developing at a fast pace due to this tie-up.
3. Hotels at Mid-Prices
A mid-priced solution is becoming popular in the hospitality industry's restaurant segment and the hotel room. Hotels that are comfortable but not as costly are trending with the rise of tourists belonging to all social classes and an even more significant projected growth. These provide a convenient and practical alternative to tourist stays’ costly existence and allow anyone to visit the Emirate. This trend has mostly manifested itself concerning service apartments, mid-priced 3-4 star hotels and Airbnb.
Technological Trend driving the Hospitality Industry
The way the world goes and more so given the way Dubai plans to grow is technology. Therefore, substantial technological changes are anticipated from the hospitality industry in Dubai and the adoption of various upcoming features in restaurant technology and hotel technology. The key technology trends that have been driving the industry are -
1. Control of Customer Relations
The hospitality industry has grown in all directions, with the diversification strategy well in progress. A direct consequence of this has been an increase in the supply of hotels and restaurants, but an increase in demand as tourism has grown but not the hospitality industry’s rate. As a result, if there is a shortage of potential customers, the industry turns its attention to the present customer and the art of maintaining them. As a consequence, Customer Relations Management or CRM Technology brings the hospitality industry forward through its reigns. As advances in POS technologies have begun, like CRM tools, the need to maintain current customers is manifesting itself in technology.
Creating a database of all clients, their orders, preferences, the amount they typically spend and even their special days to schedule offers and schemes exclusive to them and create loyalty programmes are trends that can help the Dubai hospitality industry. This process helps collect customer feedback digitally and feed it directly to your POS to determine customer service.
2. Use Of POS Technology
Investment in point-of-sale technologies is no longer a trend pursued by just restaurants, and hotels hop on the waggon to ease operations, provide better data, be able to use the data and even handle multiple fronts. A hotel restaurant billing app allows the hotel to track food sales at any possible source, including room service, bill it to one room without any hassle, provide thorough and separate reports, and even evaluate each transaction and customer in detail. This technology convergence has become the most significant trend in hospitality.
3. Penetration for the Internet
Given the young tourist population’s more youthful existence, the Internet is a vital part of the hospitality industry; it is almost a requirement. Combined with the fact that interconnectivity is a must, even in the hotel room itself, where an average guest uses at least three devices per room, it must increase the bandwidth. The average 300-room hotel in the Emirate would have to spend around 2.4 million Dirhams over five years upgrading their bandwidth to maintain quality standards to satisfy the demand. Also, 70 percent of B2C communications in Middle Eastern countries will be carried out by chatbots by 2020. Customers want data transactions that are smart, quick and informative.
Geography characterised by hospitality alone is not just Dubai, but the entire Middle East. Therefore, the region’s developments are more unpredictable and rapidly evolving with a significant effect on the global hospitality industry. These are the patterns that 2018 has seen so far and is expected to see more development.
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1. What are the social trends that are promoting the Dubai hospitality sector?
The social trends are healthy food, extended home concepts, regional aromas, and take away choices.
2. What are the economic trends accelerating the hospitality industry in Dubai?
The economic trends are quick casuals & pop-ups, deals for a hotel-restaurant, and hotels at mid-prices.
3. What are the technological trends that are driving the hospitality sector in Dubai?
The technological trends are control of customer relations, use of POS technology, and penetration of the internet.
4. Give an example of a POS technology in Dubai?
CRM (Customer Relations Management) technology.
5. How is the quick casual trend helping the Dubai hospitality industry?
It is helping as tourists are no more class-bound and the focus is more on the destination.