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Retail sales at Dubai Summer Surprises dropped by as much as 20 per cent from last year, but a jump in visitors from GCC countries filled hotel rooms and kept sales afloat, insiders say.
The 65-day festival, an annual shopping extravaganza aimed at boosting the tourism and retail sectors during the hottest months, ended on Friday.
Organisers had hoped to draw at least 2.1 million visitors to the emirate, the same number as last year, after a marketing roadshow through the GCC countries.
While the Dubai Shopping FestivalDubai Shopping Festival office has yet to release official figures, retailers, shopping centre managers and hoteliers say the tactic has helped.
Footfall figures were below last year’s levels, but there were still between 10 and 15 per cent more visitors from surrounding countries, said Shajahan Unneen, general manager of the Wafi MallWafi Mall in Dubai.
“I don’t think in terms of numbers there are more than last year, in particular to Wafi,” Mr Unneen said. The shopping centre had between 130,000 and 135,000 visitors a week during the festival, down from the 140,000 weekly average during the last Dubai Summer Surprises event, he said.
Amit Dhamani, the chief executive of the Dubai-based chain Dhamani Jewellers, which tracks where each shopper hails from, said he saw roughly 20 to 30 per cent more GCC residents buying items from the company’s stores this year. Mr Dhamani said it was “a good thing” that the organisers of Dubai Summer Surprises “knew what was going on globally, economically, and did very well in terms of targeting the right type of audience”.
Sales did not surpass those of last year but were above 2007 levels, he said. “We are certainly in a better place today than we were six months ago.”
Yousuf Mubarak Walid, the chief operations officer of the Dubai Shopping FestivalDubai Shopping Festival, which organises Dubai Summer Surprises, said organisers were still waiting for final figures but there was a visible increase in GCC visitors. “I believe that if we were not there, it would be much less than it is now. The decrease could be 50 per cent or more,” Mr Walid said.
Hotels also reported a rise in GCC guest numbers this summer. The Dubai Department of Tourism and Commerce MarketingDubai Department of Tourism and Commerce Marketing reported a 35 per cent rise in GCC hotel guests compared with the same month last year at three, four and five-star hotels, which had 64,102 GCC guests last month. The department attributed this growth to its summer promotions, which included a “kids go free” deal.
Raffles Dubai hotel, which adjoins Wafi MallWafi Mall, filled more rooms this year with occupancy at roughly between 70 and 75 per cent, up from between 50 and 60 per cent during the last Dubai Summer Surprises, Mr Unneen said.
At the Kempinski Hotel at Mall of the EmiratesKempinski Hotel at Mall of the Emirates, which had cut its rates and offered special summer packages, occupancy rose to 92 per cent last month from 88 per cent last year.
Nasser Fawzi, the director of sales and marketing at the KempinskiKempinski, said: “We have witnessed an increase in guests mainly from Saudi, Qatar and Kuwait in comparison to 2008. Lots of them stayed for two to three weeks.” However, rates this year started at Dh800 (US$217), against Dh1,700 last year, the hotel said.
Promotions at the three hotels in Festival City operated by the InterContinental Hotels GroupInterContinental Hotels Group also helped to attract visitors. Although it was only the hotels’ second summer, after their opening early last year, occupancy levels at the InterContinental and Crowne Plaza rose into the 80s last month against 65 to 70 per cent last year, said Tom Lord, the hotel manager for both hotels.
The adjoining mall also saw a surge in visitors. Tom Miles, the general manager of Festival Centre, said footfall rose by 56 per cent during this Dubai Summer Surprises. The mall, now two-and-a-half years old, saw about 500,000 visitors each week, he said.
Mr Miles estimated that the number of visitors who came from within the emirate and GCC countries was up between 40 and 50 per cent.
Robert Ziegler, the vice president of the management consultancy AT Kearney in Dubai, said hotel prices were driving occupancy. “You were able to get interesting deals this summer in Dubai, and that has certainly had impact on the market,” Mr Ziegler said.
But retailers slashing margins and hotels dropping rates, has cut into their bottom lines this summer. “Occupancy is just one indicator,” Mr Ziegler said. “It’s occupancy at what price.”
By Armina Ligaya and Rebecca Bundhun© The National 2009