The UAE’s tourism sector needs to embrace innovation to maintain growth in visitor numbers, said Mohammed Al Muhairi, the undersecretary for the Ministry of Economy.
The government minister outlined what he believed the hospitality industry needed to compete in an increasingly disruptive world where old certainties cannot be relied upon to sustain growth in businesses and visitor numbers.
“We need innovative thinking, a cultural change,” Mr Al Muhairi told the Tourism, Innovation & Transformation Forum 2016. “The UAE works best when the private sector and government sectors work together and that is why the government is calling for, and supporting, innovators. Innovation does not just happen it has to be fostered.”
Innovation in tourism has come in several forms, such as technology disrupters including Airbnb and low cost airlines.
“Airbnb will have an impact on the hotel demand,” said Rashid Aboobacker, an associate director at TRI Consulting. “Many surveys are indicating that growing number of young and even affluent travellers are now trying or switching to such ‘shared-economy’ services like Airbnb for several reasons, including flexibility, cost, authentic local experience, etc.”
International travel and tourism is in rude health if one looks at it over the long term. Over a billion people travel internationally each year, according to the United Nations World Tourism Organisation (UNWTO).
Since the global financial crisis there has been a 5 per cent growth rate each year in international travel with the forecast for 2030 at 1.8 billion people. With more people travelling there is more opportunity but with the digital space providing a level playing field for big and small operators, the game has changed.
“It’s disrupt or die,” said Sean Dennis co-founder of Loyyal, a blockchain-based loyalty and rewards platform. “Look at what Airbnb has done to the hospitality business … Well, hotel groups now have to bring those customers back by offering incentives that mean something to the customer beyond some meaningless points that are difficult to redeem. It’s the same for airlines.”
The travel and tourism industry has felt the keen disruption of social media as TripAdvisor and its like have altered the ratings for hotels and destinations but some are not sitting still and are now taking a position in the fight back.
For example, the Jumeirah Group has employed Yousef Tuqan Tuqan, the former chief executive of digital agency Flip Media and the former vice president of marketing and analytics at Careem, the chauffeur cab booking app, to help develop its strategy in this digital era.
“We created a platform called Jumeirah Inside and while it is still young our metrics suggest people who have visited the platform are 2.5 times more likely to make a booking once they visit our website,” said Mr Tuqan, the group vice president of Jumeirah Group. “It has been a major investment but the return will be seen as it’s an evolving space.”
ascott@thenational.ae
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