Hotel prices in Dubai are falling because of strong market saturation

While Expo 2020 is expected to drive up guest numbers, to survive in the long term, hotels must compete with a growing number of competitors. The consequence of the strong market saturation is a decline in overnight rates of about 12 %.

To compensate for this loss, hotels began to target not only tourists but also locals. They started to offer coffee parties, brunches, Christmas dinners... offer.

Strong market saturation encourages locals to start a new trend

Since off-season prices are affordable, locals can afford a holiday in the most luxurious hotels for little money. Better deals and the fact that alcohol can only be served in hotel bars are just a plus. More and more locals and people who work here have developed a trend of vacationing close to home, called staycations. This is a cost-effective way to fully experience Dubai as a tourist without having to travel hundreds of miles by plane.

A similar trend can be seen in Latin America, where you can book themed rooms such as Arctic, Safari, Arabic, or with private Jacuzzi, fitness equipment, canes, etc. Theme rooms are very popular for bachelor parties or when a group of friends go to the city for a weekend to celebrate.

There are many reasons why people book local hotels. Some book them because they are cheaper than a normal holiday, some because they need a short break, and some because they want to experience the area like a tourist. Whatever the reason, if hotels want to be competitive in the long run, they need to be aware of all the new trends and technologies that can give them an advantage over the competition.

Wide choice is the reason for lower prices

There are quite a few unique and interesting hotels in Dubai. One example is the Gevora, the tallest hotel in the world. In the Paramount Hotel, each room is decorated differently, in the style of the particular train. But this city has much more to offer, such as the design hotels Armani, Bulgari and Palazzo Versace.

Due to the strong market saturation, hotels have started to specialise in different segments and differentiate their offers and services. In the DIFC (Dubai International Financial Centre) area, customers can book conference rooms and business spaces in hotels. The Marina and Palm Jumeirah areas tend to be booked by families due to the wide range of hotel pools, water parks and landscaped beaches. Internet City, with its boutique hotels, is more likely to be visited by young people. These are small design hotels that are characterised by an individual style, a special atmosphere and a personal approach to each guest.

Will the saturation of the hospitality market increase in 2020?

The increase in the size of the market is also a result of the expectations of Expo 2020. It's no secret that Dubai is very popular with tourists: 16 million people holiday there. But there are many more of these passengers just transferring at the airport. Figures show that more than 20 million people are expected to visit next year, and with Dubai hosting Expo 2020, another 5 million are expected at the time of the event. Currently, the plan is to prepare 160 thousand hotel rooms to satisfy all arriving customers, visitors and tourists.

Nevron follows both the technological innovations and trends in the hotel industry, and with its outstanding expertise and comprehensive IPTV solution, it can help hotels to move into this notch.