Shopping spree

Dubai Shopping Festival, the biggest event of its kind in the Middle East, has been the perfect vehicle for propelling Dubai onto the international radar since it began 15 years ago. Now other regions are hoping to follow suit as they attempt to grab a share of the festival’s annual three million visitors and their Dh9.9bn (US$2.7bn) expenditure

Dubai is no longer just a city. Over the last few years, this most advanced emirate has graduated to a global brand to be reckoned with.

The internationally celebrated Dubai Shopping Festival (DSF) has played a crucial role in helping Dubai attain this stature. Since it began in 1996, the festival – organised by the Dubai Events and Promotions Establishment (DEPE), an agency of Dubai Department of Economic Development – has attracted millions of visitors from all corners of the planet.

The biggest shopping and entertainment festival in the Middle East, and one of the most visited events in the region, Dubai Shopping Festival attracts three million people every year on average, accumulating an average spend of around Dh9.9bn (US$2.7bn) annually. (This compared with the first edition of the event, which attracted 1.6m visitors and an expenditure of Dh2.15bn (US$585m). Indeed, since that first edition, and up to DSF 2009, approximately 35m visitors have spent nearly Dh74bn (US$20bn).)

And it’s not just a draw for tourists: traders from a myriad of different countries flock to Dubai for the festival each year, thus enhancing the emirate’s trading relations with international territories – especially, recently, emerging economies such as India, China and Latin America.

The 16th edition of the internationally acclaimed Dubai Shopping Festival ran for 32 days from 20 January until 20 February 2011. The cost of staging this year’s edition reached Dh65m (US$17.7m), much of which was allocated for the world-class entertainment and events that were showcased during the festival period. Under the banner of ‘One World. One Family. One Festival’, the extravaganza featured a jazz festival, spectacular firework displays, night souks and fashion shows – not to mention the usual unmissable discounts and promotions. And this year saw the retail participation escalate to 6,000 shops, compared with 4,000 in 2010.

Festivals Coordinator General and Deputy CEO of DEPE Ibrahim Saleh – commenting on the forecast for DSF 2011 compared with the previous two years – says: “Dubai Shopping Festival has done fairly well over the past three years in terms of visitor numbers and the expenditure of these visitors during the month-long festival, especially during the global economic crisis whereby we averaged three million visitors and around Dh10bn (US$2.7bn) in expenditure. For DSF 2011, we are looking at maintaining the same momentum.

“Also, it’s worth mentioning that DEPE doesn’t have direct revenues or profits as such, the expenditure goes to various vital economic sectors in Dubai. In this regard, we are fairly optimistic that the retail and tourism sectors will do well during DSF, and from our side we have done our homework and prepared an exciting festival that will please all our stakeholders.”

Meanwhile, the GCC (Gulf Cooperation Council territories) continues to be the key target market for DSF, followed by Southeast Asia and the Arab region, according to Saleh, who also points out that the festival has been attracting fewer visitors from Europe over the last three years. “But in contrast, we did see a huge increase from the Indian, Russian and Chinese tourists, so it all balances out,” he adds.

The positive knock-on effect on the emirate’s economy is plain to see. Dubai Department of Tourism and Commerce Marketing (DTCM) recently revealed the progress of Dubai’s tourism sector during the first nine months of 2010. Statistics indicate that the number of hotel guests in Dubai between January and September 2010 was approximately six million (5,991,660 guests), reflecting a six per cent increase compared with the 5,640,703 guests during the corresponding period in 2009 – a figure that can only have been helped by the influx of visitors to the emirate during January and February for the DSF.

The numbers for Chinese visitors to Dubai went up by a substantial 57 per cent during the first half of 2010 compared with the corresponding period one year earlier, as per Dubai’s DTCM estimates. Statistics also reveal a 17 per cent increase in the number of tourists from Russia during the first half of 2010.

Other markets follow suit
The DSF is increasingly offering a high-profile and pioneering benchmark for the Gulf region – and beyond – as neighbouring territories seek to develop their own events along similar lines.

While the event is no doubt enticing other emirates in the UAE to follow suit, festivals elsewhere in the region include Hala February in Kuwait and Khareef Festival in Oman.

Further afield, the Hong Kong Grand Sale and Amazing Thailand Grand Sale offer discounts and bargains, while the latest addition to the shoppers’ list was the Korea Grand Sale 2011, a 50-day festival that ran from 10 January until 28 February.

Similarly, in India – a crucial trading country for Dubai – the 45-day Grand Kerala Shopping Festival (GKSF) was launched in the south of India with much fanfare in December 2007. Though it is held in 14 districts of the state to promote regional products, the messaging and structure of the festival holds parallels with the DSF, which celebrates retail and entertainment with enormous creativity and ingenuity.

Dubai’s success in tourism – of which the DSF is an important catalyst – has also had an impact on neighbouring Abu Dhabi, according to industry experts. The Abu Dhabi Tourism Authority (established in 2004), for instance, launched the 2008-2012 strategic plan to promote the UAE capital’s international tourism industry. Among a number of world class culture-centric tourist plans in Abu Dhabi is the Dh100bn (US$27bn) Saadiyat (happiness) island project with local versions of the Guggenheim and Louvre museums.

While Abu Dhabi is targeting three million tourists by 2012, Dubai remains the top tourist destination in the Gulf and aims to increase the annual flow of tourists from approximately seven million to 15 million by 2015. According to the Dubai Chamber of Commerce and Industry (DCCI), tourists spent about Dh28bn (US$7.5bn) in the emirate in 2009.

And, according to Sharjah Commerce and Tourism Development Authority, the third largest emirate recorded more than 10 per cent growth in the tourism sector. “These [shopping festivals] have had a phenomenal impact on civil aviation, services and entertainment sectors in all three emirates, enticing other emirates to follow suit,” says UAE-based analyst on Gulf-Asia relations, Dr N Janardhan.

Dubai: ‘shopping capital of the world’
Home to over 50 large shopping malls housing reputed international brands, Dubai’s shopping extravaganza holds key significance for global buyers as they seek to increase their brands’ sales manifold.

Emphasising the importance of DSF, Dubai-based buyer Anshu Jalan says: “This is the time when our sell-in to all the retailers increases considerably. For instance, our sales for prestigious brand Kanebo increase by approximately 15 per cent during the DSF period. Other brands like Max Factor, Revlon and so on register a growth of approximately 20 per cent.”

Jalan handles Kanebo’s Sensai brand and is working as a Brand Manager for Mawarid Trading Enterprise’s UAE operations.

She adds: “Overall, the increase for luxury brands is as high as 15 to 20 per cent during the DSF months. Dubai is one of the most important countries in the Middle East and to be a buyer in Dubai for good brands definitely holds a lot of weight.”

Commenting on Dubai’s economic climate, Jalan says: “Dubai’s economy is largely based on trading relations that it holds with other countries, making it a very competitive market among distributors.

“It is therefore a challenge for any buyer to retain good brands in Dubai, but events like DSF offer a huge thrust to brands.”