With the summer season heating up, retailers are putting their marketing campaigns in full swing.
Summer in the UAE has become known as a time when business slows down, and residents and expatriates venture off to their home countries or cooler destinations. However, with the Arab Spring bringing a wave of political instability in a number of countries in the region, the UAE has been a big beneficiary seeing an increase of in-bound travel and tourism. Add Ramadan to the mix and you get a prime marketing opportunity for retailers and other brands to reach consumers during one of the busiest spending periods of the year. In fact, the holy month is the second highest spending month of the year in the region. During this time, families and younger individuals frequently break their fast at restaurants and tend to stay out until the early morning hours. To capitalise on this financial opportunity, many companies spend a very sizable portion of their advertising budgets to reach their target customers in creative ways.
The UAE is of particular interest in this category as it ranks as one of the richest countries in the world. Its population are also the biggest spenders in the MENA region. A recent report by the Arab Money Fund shows the UAE far ahead of other GCC countries and other Arab nations when it comes to domestic consumption with an average individual consumer spending put at USD 21,577.
The Dubai Events & Promotions Establishment (DEPE) under the Department of Economic Development is looking to keep this spending trend going by positioning Dubai as a major shopping and entertainment destination during its summer months. DEPE is revamping its Dubai Summer Surprises (DSS) campaign this year to include many new marketing initiatives and attractions are being rolled out that cater to all types of consumers from tourists to families to locals. DEPE estimates that UAE residents alone spend AED 1.2 billion on shopping during DSS last year.
One of the biggest draws for the summer marketing campaign is no doubt shopping, as retail remains one of Dubai’s strengths. The DSS marketing campaign this year aims to make the Emirate the go-to destination for holiday summer shopping and entertainment. The key to keep this trend going is to expand such in-door activities that would attract tourists, residents, ex-patriates and locals.
Around 70 malls and a total of 6000 shops are expected to participate in DSS this year with discounts reaching up to 75% on its products. Inspection teams from DED will be monitoring the sales activities by doing random visits to participating retailers to ensure that prices are correct and that all the rules are being met. This year will also be different as Ramadan descends on the last few weeks of the summer season. The month has traditionally been a peak time for shopping and gift giving.
“When organising an event with such magnitude and impact, you are always faced with many challenges, wither stratigical or tactical. One of ourconstant challenges is how to cater to the sophisticated and diverse public in Dubai, residents and visitors, in terms of events and attractions,” says Laila Mohamad Suhail, CEO of Dubai events and Promotions Establishment. She points to the rapid growth of Dubai’s tourism sector in recent years and says the levels of tourism are sometimes unpredictable.
The Global Retail Development Index (GRDI) recently released by AT Kearny shows Dubai moving to from eighth place to seventh place this year fuelled by the high levels of tourists flocking to the Emirate’s many malls. Dubai Mall is the world’s most-visited shopping and leisure destination. With over 54 million visitors (up 15% from 2010) and a 35% increase in average sales, the one-million square foot expansion plan reflects growing interest by international retailers. The Mall of the Emirates, the country’s second largest mall, had its best performance in 2011 since it was founded in 2005.
Dubai also ranks prominently on the 2012 Global Destination Cities Index released by MasterCard in June which measures the number of inbound international visitors. The Emirate outranked cities such as New York, Amsterdam, Kuala Lumpur, Shanghai and Beijing. With 8.8 million international visitors expected in 2012, Dubai is the eighth most highly ranked destination city in the world, moving one spot higher compared to 2011 and marking a growth of 15.3%. In terms of the volume of international visitor spend, Dubai ranks 18th in the world with a projected USD 8.8 billion visitor spend in 2012, an 18.5% growth over 2011, according to the report.
London is the number one origin city for Dubai, with 803,000 visitors expected in 2012, followed by Paris, Munich and Kuwait . Visitors from London are also the highest spenders in Dubai with USD 1,495 spent per visit, compared to an average of just below USD 900 by visitors from the other four top origin cities. However, the growth rates of visitors from Munich, Frankfurt and Paris are remarkably high at 29.5%, 22.1% and 20.2% respectively.
“In the past few years we have witnessed a lot of changes in trends and moods of the global tourism industry, wither it was as a result of the global economic crises or the regional unrest. However, Dubai was always a favourable destination due to its state of the art infrastructure and its vibrant events and festivals industry,” says Suhail.
Suhail also noted the increase of tourism from fast emerging markets like India and China, where a growing middle class is increasingly looking to travel – with shopping and entertainment high on their holiday agendas. “The Emirate is now not only a must for global brands, but increasingly the first place for international retailers looking to expand outside of their home markets , whether they come from Europe, the US or the Far East,” she says. “Our focus now is on sustaining this success whilst growing the complementary events, festivals and entertainment sector, which is a natural fit for the Emirate.”
In addition to the countless malls participating in promotions and events, Dubai World Trade Centre will be a popular place this year with one of the largest in-door amusement park Modhesh World, as well as Dubai Sports World. A new attraction will be the Ramadan Night Market, which will be an event held during the last ten days of Ramadan through the Eid holiday.
“During the end of Ramadan people would like to shop for Eid and Dubai is known for being a spoilt for choice when it comes to shopping. It’s the shoppers paradise. Hence Ramadan Night Market It’s a night market simply because during the day you are fasting and it’s a bit difficult to go out especially in summers,” says Sunil Jaiswal, CEO of Sumansa Exhibitions, which is organising the event.
A similar event currently runs every year in Abu Dhabi, but until now there hasn’t been an event of this profile being held in Dubai. Jaiswal says he expects a strong visitor turnout, and is primarily targeting UAE resident and families as people tend to spend more time at home during the day and do their shopping during the evening and later hours during this time. “We felt, an event of this nature at this time of the year would be a fantastic idea. For both exhibitors and shoppers, it will be the right platform, whereas shoppers will get to shop for all their Eid requirements, retailers can use this to sell, market or launch new products.”
The exhibition will also be a competitive platform that will draw around 300 retailers to showcase their products that would appeal to shoppers during this time of year including luxury garments and goods, jewellery, packaged food items Jaiswal expects there to be a balance of larger brands and SMEs exhibiting. “Entrepreneurship is in the DNA of Dubai , We are seeing a large interest from SME segment (Emiratis & expats ) and the same time we are in discussion with big brand especially from electronics category. We love marketing and we’ll be using whatever tactics we have to entice the crowds, we’ll be tracking and measuring what works best, and we’ll see what is the most effective means of communication. “
While a majority of these campaigns plan to target night shoppers, online retailer Namshi is planning to draw in users who are spending more time at
home this summer. “We are expecting two trends to impact our sales. A potential reduction in traffic to our site because of families travelling for the summer, offset by an increase in the number of people who would prefer to stay home and would visit our site and get the items delivered conveniently without any hassle with trips to shopping centres,” says Louis Lebbos, co-founder of Namshi.
The online retailer boasts fashion brands, many of which are not yet available in the region and is an avid user of social media platforms to engage with its customers. Namshi, a relatively young SME launched just last year in the UAE and has expanded its reach beyond the other GCC markets and Egypt.
Lebbos says that during the hot summer months, the company’s top selling points of collection and convenience stand to resonate with a wider range of consumers. The online retailer will continue to offer discounts on a variety of brands and may even be adding gift bundles for the occasion.
Increasingly, companies are looking to utilise technology to better target and engage with their audiences and customers. Last year, Yahoo! Maktoob launched a Ramadan application catering to its web and mobile readers. The app provides prayer and fasting times, a range of useful tips and facts, and also the latest news relevant to the holy month. The number of Ramadan-themed apps has been steadily growing each year and there are thousands currently available on SmartPhones and tablets.
At the recent launch of Facebook’s regional office in June, Jonathan Labin, the company’s head of global marketing solutions for the MENA region, hinted at plans to up its advertising during the holy month. Along with high television viewership, social media use is also expected to be strong during this time. Emirates Airline’s relatively fresh Facebook fan page, has a large following and strong engagement with its audience. The airline keeps users frequently updated on all of its newly launched destinations, in addition to its reduced air fares and other special offerings during Ramadan.
With more and more companies looking to strengthen their presence in the region, there is no doubt that technology will be of paramount importance to reach new consumers and the youth in particular. The most recent Arab Media Outlook, published by Dubai Press Club, reveals an informational gap in the region, where younger individuals are tuning out traditional media and are accessing much more personalised content through social media on-the-go. For advertisers, the main challenge will be how exactly to use such platforms and new technology to keep their brand relevant in a much more crowded market space.
Rushika Bhatia Editor
Rushika Bhatia is one of the region’s leading commentators on business and current affairs issues. She is the Editor of SME Advisor magazine - the flagship title of CPI Business. She is passionate about infographics – with special emphasis on data, research and statistics. Rushika has a Bachelor’s Degree from Indiana University, USA and is also CIMA qualified.