Organisers are shifting tactics in the wake of the global credit crunch, luring shoppers with bigger price cuts.
Dubai Shopping Festival cut prices to lure shoppers
Dubai Shopping Festival organisers are shifting tactics in the wake of the global credit crunch, luring shoppers with bigger price cuts and targeting visitors from the GCC and Asia, rather than Europe. "With the global financial issues we are having right now, we are working with the retail sector to get even further discounts and make it easier for people to spend," said Laila Suhail, the chief executive of the Dubai Shopping Festival.
The DSF office was allocating more advertising in countries less impacted by the financial crisis, such as the Middle East, Asia and India, Ms Suhail added. The festival, which launched in 1996 to boost tourism, is the premier event for both tourism and retail sales in the emirate and has grown steadily each year. During the 2006-07 festival, which lasted for 45 days, 3.5 million visitors spent Dh10.2 billion. Figures for the 2008 DSF will be released by the DSF early next week.
Ms Suhail said she hoped the 2009 edition - which starts on Jan 15 and lasts for 32 days - would "sustain" the same numbers as the 2005 festival, which is comparable in length. That year, the DSF attracted 3.3 million visitors and recorded sales of Dh6.67bn. Next week, DSF organisers plan to meet with retailers on ways to deepen discounts for potential customers, Ms Suhail said. Past festivals have seen discounts as large as 70 per cent, but she said she would aim for more where possible.
Registration for participating retailers begins on Saturday, but Ms Suhail expects to have up to 6,000 retailers involved in the festival, up from 4,000 in the previous year. The rise was partly due to the addition of new stores in the recently opened Dubai Mall, she said. The festival has 130 sponsors so far, compared with 145 sponsors last year. She expects more to sign on in the coming weeks.
For most retailers in Dubai, the DSF generates a large chunk of the year's profits. "Historically, it is between 25 to 40 per cent of our annual sales, said Eisa Ibrahim, the general manager for the BurJuman centre and the chairman of the Dubai Shopping Mall Group. "For us, it is definitely an important shopping season," Sales were strong at BurJuman this year, but lagged in November, he said. During the first two weeks of this month sales have regained pace and Mr Ibrahim is optimistic sales will pick up during the 2009 DSF.
Mr Ibrahim aims to work with retailers as well as businesses from other sectors such as hotels to cut prices and attract more visitors, he said. "We know that the first quarter is going to be tough, internationally speaking. But if we work together, I think we will cross this bridge quite fast," he said. For Joy Alukas jewellers, sales from the DSF account for about 10 per cent of their annual sales, said Tomy Joseph, the general manager. He said sales have been strong this year, but he did not believe that Dubai was immune. We don't feel any crisis here," said Tomy Joseph. "We have the usual sales, so far no crisis here. But DSF is driven by the tourist flow."
Gold and jewellery retailers have "reservations" because of the slower tourist flow this year, said Swapna Nair, the general manager at Dubai Gold Jewellery group. However, with gold prices at a relative low and people flocking to gold as a safe place to park their cash, Ms Nair expects gold sales to do well. "The value of gold has been reinforced this year," she said. "It's a guilt-free purchase, an investment and not just throwing away the money."