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Middle Eastern travelers: a coveted bonanza

Strategic for a successful summer season, Middle Eastern clientele are more sensitive than other clientele regarding geopolitical hazards. While Europe remains a preferred destination, it receives increasing competition from Southeast Asia and the growth of intra-regional tourism. The key to success and a guarantee of loyalty with this highly coveted, well-to-do clientele: consideration of their cultural particularities.

Middle Eastern tourism remains a sure value more than ever. The Vision 2020 report by the WTO foresees steady annual growth by 5.5%. According to forecasts, the number of tourists from the Middle East should grow to nearly 45 million, or nearly twice the number of arrivals recorded in 2001. This growth is not a new phenomenon. A similar increase was recorded between 1990 (8.5 million) and 2004 (20 million). Nevertheless the rate is picking up speed and the current boom incites covetousness, because this tourism, which is driven by petrodollars, is particularly remunerative. The revenues generated by countries belonging to the GCC –Golf Cooperation Council (Saudi Arabia, United Arab Emirates, Bahrain, Kuwait, Qatar)– grew to 32 billion euros in 2006 and should climb to 70 billion in 2016, according to the Pacific Asia Travel Association (PATA).Once conquered, this demanding clientele shows its appreciation with a strong sense of loyalty. It is not rare to see travelers from countries in the GCC return to the same property from one year to the next. Better still: if they are satisfied they are quick to spread the word. In the Middle East, the opinion of friends and relations counts more than anything else when it comes to choosing a destination, well ahead of any recommendation from a travel agency. To show the quality of their supply, hoteliers have invested in an important asset: their growing presence in Dubai, today’s new showroom for hotel brands.At a time when in Europe, and France in particular, the overall trend is to reduce spending, people from the Middle East are not reducing their vacation budget. Average spending is up to 2,350 euros per person. This already high figure may be multiplied by the number of participants in a holiday. A Saudi or Emirate household consists of five members on average. In Kuwait, families with more than 7 members are common. To evaluate the overall cost of a stay it is enough multiply the sum by two or three because summer vacations, which unite brothers and sisters or friends, also often bring together several families. To all these participants, may then be added the children’s nannies or, in the case of important personages, bodyguards. In the end “a small Middle Eastern delegation reserves between 10 and 15 rooms,” explains Richard Schilling, director of the Hotel Concorde Martinez in Cannes. The reservation is even more profitable in the case of a princely or royal family, and his vast entourage, which may reserve several floors.Another important advantage: “they travel more often than they used to and stay at the same destination for a longer period of time,” remarks Nick Page, manager for the Gulf region of the PATA. In fact, the stay of a tourist from one of the GCC countries is 22 days on average. When the heat becomes suffocating in the Persian Gulf, residents of the Middle East travel to more mild climes. With its pleasant summer and luxury offer, Europe has long been positioned as one of the favorite resort regions alongside Cairo and Beirut. The latter has always been the Mecca of Middle Eastern tourism, but its position has been greatly weakened by regular geopolitical upsets.Diversified, the European continent meets all their expectations: the sea, shopping, large cities, culture, nature, the change of scene offered by the mountains, medical tourism, a niche market that Germany has positioned itself on. Many take advantage of this diversity by varying the pleasures during the two-month school recess and combining a sunny (French Riviera, Sardinia, Marbella) or Alpine (Austria or Switzerland) destination with stays in the major urban centers (Paris, London, Geneva or Milan, Venice or Barcelona).Upscale par excellence, this clientele is strategic in more ways than one for hoteliers located on the major summer migration axes. They can make a summer particularly fruitful by their simple presence or disastrous if they are absent. In 2005, the period of mourning that followed the death of King Fahd of Saudi Arabia cast a pall over the entire European Riviera. In July-August, Middle Eastern travelers often represent more than one third of clients at the many palaces along the Coast – and up to 60% of the Grand Hotel Kempinski in Geneva.Sensitive to geopolitical hazards, the migrations of Middle Eastern clientele were seriously affected by the fatidic September 11, 2001 (-14% of arrivals in Europe in 2002) followed by a quasi-stagnation in 2003 due to American military intervention in Iraq. The drastic security measures implemented in Western countries –combined with the fear of being unwelcome– stood in the way of people from the GCC traveling in Europe and the United States. “Whereas before some families visited their children who were studying in the United States, today, it is their children who do the traveling,” observes Pascal Lepêtre, director of the Maison de la France for the Near and Middle East.Fortunately, in Europe at least, the disaffection was short-lived. “The situation is back to normal,” assures Pascal Lepêtre. The number of arrivals was back up by 2004 (+15%). With the renewed confidence, traditional European destinations have been the object of growing competition. This is because during this period of relative disgrace, competing regions did not sit still. To conquer market shares, the ambassadors of destinations worldwide have been rushing to Dubai. Like Maison de la France, located there since the beginning of 2006, tourism offices have been multiplying there. The Arabian Travel Market has become the unavoidable rendezvous for meeting and convincing the decision makers of Middle Eastern tourism. In 2004, the event drew representatives from Algeria, Malta, Nepal, the Ukraine and Iran. In 2005, Finland, Myanmar and Brazil joined them. Japan made its first appearance in 2006. New participants increase the list of exhibitors at the ATM each year: Macao, China and Taiwan. Hong Kong, which is overflowing with luxury hotels, is intensifying its marketing directed this clientele that appreciates upscale service.The Asia-Pacific has positioned itself in the front row to collect a piece of this growing cake. Since 2001, growth of Middle Eastern tourism in this region that is easily accessible by plane has been 12% per year. “Between June and September is the ideal season for visiting Asia Pacific,” insists Anthony Wong, general manager of Asian Overland Services Tours & Travel Group. While it may be difficult to consider 35°C and 80% humidity “an ideal marketing” pitch, it can only be observed that promotion has proved profitable. Thailand, Malaysia, India are the first to benefit from this phenomenon. Singapore too, as it drew 30% more Saudis in 2006 than the previous year.In order to seduce the Muslim visitor, the Singapore Tourism Bureau publishes a guide especially for them. The city-state dynamic thus plans to keep travelers on stopovers on their way to Thailand or Malaysia, its Muslim neighbor. “This country has concentrated all its promotion on its “Muslim friendly” character”, remarks Pascal Lepêtre. Another major argument: Malaysia has no visa requirement. In the post September 11 months, Middle Easterners logically turned towards “sister” destinations, in terms of culture and religion. Among the great beneficiaries of these trends was Turkey, thanks to efficient marketing directed at countries of the GCC. It rose from number-three European destination in 2000 to the first position in 2004.But, of all the Muslim countries, it is the countries of the GCC themselves that are now the best positioned to take advantage of the global growth of Middle Eastern tourism. Intra-regional tourism is developing at an outstanding rate. Its share has grown from 62.4% of departures in 1990 to 77% in 2004. These market shares came from Europe, which dropped from 19.2% to 9.4% on the same period. In 2000, the latter still had 12.4%. The development of dynamic economic poles and the incredible proliferation of tourism projects support this development. More liberal, the Emirates with Dubai and Abu Dhabi as the main attractions have thus become destinations of choice for Saudis and Kuwaitis.Despite their appeal, these destinations, Dubai, Manama or Mascate, offer a climate that is strictly identical to that of Riyadh or Jeddah. This is why Europe, no matter what, and despite attempts to capture clientele, still has solid assets to its advantage. “Geneva remains a first rate turntable,” confirms Patrick Mossu, general manager of Kempinski Geneva, ex-Noga Hilton. The city’s financial strength as well as major events, such as watch or business aviation fairs, continue to attract Middle Eastern travelers to the shores of Lake Leman. In the summer, Geneva’s festivals exercise a powerful attraction for all generations. “Summer 2007 was exceptional. We hosted families that were increasingly young, the children and grandchildren of our oldest clients,” adds Patrick Mossu.To seduce this demanding clientele, hoteliers adopt different initiatives to compete. The Grand Hôtel Kempinski, which is first and foremost a hotel targeting the business and MICE segment, “becomes a re-sort as summer approaches,” according to its manager. Extra personnel are called in to keep the kitchens, laundry and room service running 24/7.“Because what matters is the rapidity of service,” explains Patrick Cossu. “In order to meet expectations, room service must be available around the clock so that dinner may be served, if necessary, at two or four o’clock in the morning,” confirms Richard Schilling. Another necessity is flexibility. Because when they are on vacation Middle Eastern clientele have a displaced time schedule, and may go to bed late… very late. “This is why we extended the lunch service at our beach restaurant to 5 pm. Another detail that allows them to sleep comfortably is our blackout curtains that completely block out daylight”.Consideration of their expectations is of course essential in order to seduce and develop the loyalty of this clientele. Extensive availability of television stations from the Gulf, a restaurant or room service menu translated into Arabic –halal food is a necessity and Lebanese specialties are welcome – will be most appreciated. From a religious point of view, the Grand Hyatt in Singapore added a qibla, which indicates the direction of Mecca, to its rooms for those who wish to pray. Some meeting rooms in the Grand Hotel Kempinski in Genèva, meanwhile, are converted into prayer rooms. As Ramadan will take place during the summer holiday season in the years to come, these initiatives might help convince a selection of clientele from the GCC to resist the temptation to stay home or to head to Muslim countries du-ring this period of fasting.The final recommendation for appealing to Middle Eastern tourists: maintain close relations with them. “I try to greet our clients every day,” explains Richard Schilling. For sales, it is also important to maintain personal contact with local travel agencies, which are the most important vector of reservations together with sales made directly at the hotel reception desk. The use of Internet is very limited with this clientele. “It is not enough to send them a rate, it is necessary to go meet the owner of the agency,” warns Patrick Mossu. The shrewd hotel manager owes it to himself to make his rounds and visit these big clients and strategic middlemen during the reservation season from January to April.Once conquered, this demanding clientele shows its appreciation with a strong sense of loyalty. It is not rare to see travelers from countries in the GCC return to the same property from one year to the next. Better still: if they are satisfied they are quick to spread the word. In the Middle East, the opinion of friends and relations counts more than anything else when it comes to choosing a destination, well ahead of any recommendation from a travel agency. To show the quality of their supply, hoteliers have invested in an important asset: their growing presence in Dubai, today’s new showroom for hotel brands.

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