As leading executives from hotel and travel companies from around the world gathered in Dubai for the annual Arabian Travel Market conference last month, news that a 24 hour 'stopover' visa could soon be issued to entice tourists transiting through Dubai's International Airport to stay a little longer seemed well timed.
Dubai has achieved a great deal in terms of tourism growth in recent years. Its announcement at the same event five years ago that it planned to double tourism numbers from 10 million in 2012 to 20 million by the end of 2020 seemed hugely ambitious when it was made, but, by the end of last year, tourism numbers had grown to 15.8 million, or 6.2 percent year-on-year, placing it within sight of its target.
Yet despite this, the growth in the city's hotel pipeline in the run-up to Expo 2020 has placed pressure on average room rates, and first quarter visitor numbers for 2018, while still record-breaking at 4.7 million overnight stays, slowed to a growth rate of just 2 percent.
The introduction, therefore, of a visa that could potentially create hundreds of thousands of overnight visitors from countries whose citizens are currently not granted visas on arrival may seem to be a way of boosting numbers just when it is needed most – especially since 70 percent of those using Dubai International Airport last year were transit passengers.
However, the chief executive of Dubai Corporation for Tourism and Commerce Marketing (DTCM), Issam Kazim, said that working with authorities to relax visa restrictions was always part of its long-term plan.
"When we rolled out the strategy in 2013 and we set out the roadmap of how to get 20 million visitors, we also looked at how we can make sure people spend longer times in Dubai, and how can we encourage more spend in the city," he told Zawya in an interview conducted at ATM.
"So when we look at the 20 million, we looked at the strategy and the hurdles that people have - the barriers of that growth. And visas was always part of that discussion."
Hotel and visitor numbers
DTCM published its 2017 Annual Visitor Report during ATM, which showed that the total number of hotel rooms in Dubai increased by 4 percent last year to 107,431, but that the growth in visitor numbers meant that occupancy rates remained unchanged at 78 percent.
It also revealed the impact that a more open visa policy can have on visitor numbers. The UAE announced it would grant visas on arrival to Chinese visitors in September 2016, and to Russian visitors from January last year.
Following this, visitor numbers from Russia in 2017 increased by 121 percent to 530,000, while those from China increased by 41 percent to 764,000. China is now the fifth-biggest source market for Dubai tourism.
Kazim said that the stopover visa, which was approved by the UAE Cabinet last month but which has yet to be enacted, "was always part of the plan" in terms of growing visitor numbers, but stressed the need for a staggered approach to give time for hoteliers and tour operators to develop offers that are appropriate for various source markets.
"From our experience of working with business tourists, a lot of people come to Dubai not knowing what to expect. Maybe the companies have asked them to attend an exhibition or a conference. More often than not, we realise these guys come back again and again as visitors - with families, with friends. So it shows you that once they've got that taste or the service and what Dubai really has to offer, we've created a repeat visitation."
Short stays could lead to the creation of specialist day packages or overnight visits that include popular attractions such as Burj Khalifa, the city's historic district, or even its theme parks.
Theme park woes
DTCM's 2017 report highlighted that The Dubai Mall remained the city’s most popular attraction, visited by 97 percent of tourists, followed by the Dubai Fountain (81 percent) and the city's heritage and tourist districts (63 percent).
As yet, however, the city's new theme parks have not enticed significant visitor numbers. Dubai Parks and Resorts had initially forecast annual visitor numbers of 6.7 million to investors, but only achieved 2.3 million in 2017 – its first full year of operation. The company announced a restructuring in August last year, and a new strategy which cut prices in a bid to attract more repeat business from local and regional visitors.
DTCM's annual report states that just 5 percent of tourists visited Dubai Parks and Resorts’ most popular park, Bollywood Parks and Resorts. Neighbouring Legoland was visited by 4 percent of tourists, but Motiongate only received visits from 1 percent of tourists. The all-indoor IMG Worlds of Adventure theme park owned by Ilyas and Mohammed Galadari group fared little better, receiving visits from 6 percent of tourists, compared to 14 percent who visited Dubai Holding's neighbouring Global Village.
Kazim said that growing attendance at such attractions was a matter of "educating the market" and of all partners - park owners, hoteliers and tourism authorities - taking a shared responsibility.
"It's not about Dubai as a city having campaigns in isolation that focuses on theme parks, or the theme parks having campaigns that's in isolation to sell their property.
"There's no immediate solution that can happen. When you launch a big, big project like that (Dubai Parks & Resorts) which is word class in its own right, it takes a while for people to realise how easy it is to access, what there is there to do and how it actually caters to so many different age groups," Kazim added.
The local touch
One area that DTCM has targeted, particularly with a view of making it more attractive to cruise ship tourists docking at the nearby Mina Rashid port, are the city's historic districts around the mouth of the creek between Bur Dubai and Deira.
Kazim said that Dubai's tourism development and investment arm has been working with the Dubai Municipality, the Roads and Transport Authority and other landlords in the area on improving wayfinding for visitors and developing more heritage attractions within historic buildings.
It is also looking at creating tours using licensed guides - where possible, Emirati guides, as tourists value meeting local people.
“But also, we're trying to create apps with the best solution providers globally to try to find the ones that are suitable by market,” Kazim said. “So that, for example, if a visitor from China is coming in, and they are used to a travel app on their phone, they will be able to download the Dubai portion of it and explore at their own pace.”
For instance, Dubai Tourism announced on Tuesday that it has agreed a deal with Chinese ecommerce giant Tencent to promote Dubai’s tourism offering. The agreement will also lead to Tencent’s WeChat and WeChat pay systems being promoted as a mobile payment method in Dubai to cater for Chinese tourists using the system. The announcement came a day after Dubai Tourism announced it had struck another deal with Chinese handset manufacturer Huawei, which will see the technology firm pre-load official and user-generated content about Dubai onto its devices.
Changing visitor mix
A study published by real estate consultancy Knight Frank and forecasting firm Oxford Economics stated that tourists visiting the UAE increased by 155 percent in the 10 years to 2017, when the total number of overnight visitor stays reached 70.9 million.
It said that visitor source markets have barely changed over the past 10 years, with India, the United Kingdom, Saudi Arabia, China and Iran currently the top five source markets for UAE tourists. However, predictions for the top 10 markets in 2027 state that the fastest-growing markets for future visitors are likely to be Egypt (116 percent forecasted increase over 10 years), Pakistan (102 percent), China (97 percent), India (76 percent) and Saudi Arabia (56 percent).
Speaking to Zawya about the report, Knight Frank senior analyst Taimur Khan said the changing visitor profile would create more opportunities in the midscale hotel sector, as currently the hotel market in the country is skewed towards the luxury four- and five-star hotels market.
Its report said that 57 percent of hotels in Dubai and 66 percent of hotels in Abu Dhabi were either four- or five-star properties. Moreover, all of the hotels currently under development in Abu Dhabi and 49 percent of those in the pipeline in Dubai remained in thus upper-midscale to luxury end of the market.
"I think it needs to be more balanced," Khan said.
During the interview with Zawya, Kazim said that Dubai Tourism had been targeting a broader range of source markets and working with hoteliers on developing suitable offers - for instance, developing offers for more price-sensitive travellers during off-peak seasons.
“If you look at the campaigns we ran lasts year, we were in over 44 countries with our campaigns and our messaging,” Kazim said.
"The most important thing to get to the 20 million (target), is not just to identify that these are the guys who will be interested, but working closely with the trade - with the partners and the stakeholders here – (to gauge) if they are price sensitive-travellers, from which markets, at which time of the year would they be appealing to these properties as well.”
At a press conference held just before this year’s Arabian Travel market, Kazim had also been asked whether stopover visas would be issued to all nationalities at once, or whether it would be a phased approach, covering groups of nationalities at certain times.
“We work very closely with the government so they know all of the markets that are important to us,” he said. “And if it's not in one batch that they will announce that everyone can come through, I'm pretty sure that they will work on a phased approach while they get more and more added to the list. Unfortunately, right now, we don't have the list. We know that it's in the pipeline," he said.
It is a list that the city’s hoteliers and attraction operators keenly await.