Online travel agencies ‘taking advantage’ of hotels, says Dubai start-up

Online travel agencies (OTAs) such as Booking.com and Expedia are taking advantage of hotels, according to the co-founder of direct hotel bookings platform BookedHappy.

Speaking to Arabian Business ahead of the platform’s launch, Charlotte Gossage said agencies’ powerful marketing tools have “intimidated” hotels and prevented them from lowering rates on their own websites.

The platform, which is set to launch next week, aims to bring business back to hotels through direct bookings. It will include hotel deals on the platform, but refer customers to hotel websites to enable direct bookings.

“Some hotels are slowly realising that even in an OTA contract, a hotel brand can give a lower rate. I think OTAs are taking advantage of their powerful position and intimidating hotels by preventing them from giving lower rates than them, when in fact, hotels can give lower rates through direct bookings,” Gossage said.

“OTAs have so much marketing power behind them that hotels also show guests that they rely on OTAs. So we all feel comfortable going through the agencies,” she said.

The founder said OTAs have largely affected hotel bottom lines due to high commission charges.

“OTAs told hotels, ‘Oh, we’ll help you to get your rooms filled,’ and then they took control. So hotels got a bit complacent, but room rates were at a four year low last year and hotels’ bottom line is really being affected,” she added.

Gossage claimed hotels give OTAs up to half a million US dollars in commission every year.

“I wouldn’t be surprised if some hotels were giving half a million dollars to Booking.com a year. But if you look at Booking.com and see how many bookings have been made, keeping in mind that the average room rate is around [$100], even 15 percent commission is a lot of money,” Gossage said.

The founder also said hotels should work harder to get guests to book directly through their websites by improving them and offering extra perks.

“The problem is that all hotel websites are cookie cutters and don’t stand out. Hotels can stand out more and that’s what we’re trying to do,” she said.

“If customers book directly through hotel websites, they’re most likely to get extra perks such as a room upgrade. According to case studies we’ve conducted, families with kids are more likely to get a nicer room if they book directly with a hotel as opposed to through OTAs,” she added.

In September last year, a Netherlands-based start up told Arabian Business it is also aiming to “give business back to hotels” through a 0 percent commission model that takes on online travel agencies such as Booking.com and Expedia.

Bidroom boasts a 0 percent commission model and relies on annual subscriptions and memberships for profit.

Co-founder and CEO Michael Ros said the concept offers both hotels and guests more value for money by eliminating agency charges.

“The hotels are very happy with us, because they’re getting their control back. Other booking platforms charge such high commission. So we give them their business back, plus direct reservations, so all the hotels came on board with us,” he said.

“Because we don’t take commission, we create a win-win situation for both guests and hotels. If we don’t charge commission, hotels save a lot. And if we give on behalf of that back to guest, the guest is happy to save 10%. Hotels earn much more on reservations, so they’re more willing to give better discounts on room rates. We’re also a closed platform, so prices are not public,” Ros added.

For all the latest travel news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.

Malls should give local designers space, charge less rent, says Rami Al Ali

Shopping mall operators should offer more space at lower rents to local designers, according to Dubai-based designer Rami Al Ali, whose couture and ready-to-wear creations are sold in department stores such as Bloomingdales and Harvey Nichols across the Gulf region.

Speaking to Arabian Business, Ali said local designers in the GCC do not receive enough support.

“[Local designers] should be given more space in the malls, and should not be charged the same rent as other, bigger businesses. The fees should be in line with the size of the business,” he said.

“There should also be certain government funding for small businesses,” he added.

Space for local designers was added in the UAE through projects such as the Dubai Design District (D3), which was opened in 2015 and was aimed at helping emerging designers showcase Middle Eastern talent to a global audience.

However, while the area added space, it offered little footfall, Ali said. The creation of the Dubai Design and Fashion Council (DDFC) had little impact too.

“D3 was great, but what did it add to the creative community except for space? There’s not much to create footfall in that area anyway, so it’s all an individual effort at the end of the day. At the same time, they created the DDFC, but what came out of it? There was a big hype around it when it was established five years ago, but nothing has happened,” he said.

The district claims to house over 6,000 working individuals occupying 85 percent of the space. Yet it is home to only two retail stores dedicated to local designers, according to its website. The majority of the rest are stacked with international products, with rent averaging $50 per sq ft, according to real estate marketplace Property Finder.

Ali urged the local community to encourage local talent to prevent young designers from leaving to fashion hubs such as Paris.

“When I talk to young designers, they say, ‘The minute I get money, I’m going to Paris,’ because there isn’t enough support in the region. We need to put more trust in our local talent and product,” he said.

For all the latest fashion trends from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.

Emirates, WhatsApp among most popular brands in Middle East

In 2018, UAE-based carrier Emirates, fast food chain Al Baik and messaging service WhatsApp generated the most positive ‘buzz’ or perception in the UAE, Saudi Arabia and Egypt respectively, according to the annual YouGov BrandIndex Buzz Rankings.

The report measures the public’s perception of brands on a daily basis across a range of metrics including whether people have heard positive or negative news about a brand during the previous two weeks.

In the UAE, electronic giant Samsung saw a surge in popularity, climbing up to second position from sixth last year. Samsung Galaxy created a lot of positive noise with the launch of its new phone, the Samsung Galaxy Note 9, leading to a rise in its Buzz score and improving from tenth in the 2017 rankings to fifth in 2018.

While its competitor Apple and its iPhone handset retain their places in the top ten rankings, they dropped from fourth and third last year, to sixth and seventh, respectively.

In Saudi Arabia, however, Samsung Galaxy lost its spot in the top 10 rankings, while iPhone saw a drop in its rank from third to sixth this year. Meanwhile, Chinese tech giant Huawei showed significant improvements in its Buzz score in kingdom, where it is the second most improved brand, and in the UAE, where it is the third most improved. 

The YouGov BrandIndex also revealed the ten most improved brands of 2018.

In the UAE, Coca-Cola ranked number one with a rise of +7.5 points to its Buzz score, going from +6.5 in 2017’s rankings to +14.0 in 2018’s.

Beverage brands particularly resonated well with consumers in Saudi, with four included in the top 10 improvers list. On the other hand, fast food chains and food brands fared well with consumers in Egypt, while Netflix also generated positive Buzz in the country as well as in the UAE, becoming the second most improved brand of the past year in both countries.

For all the latest business news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.

UAE denies reports of 747 touching down on Fujairah Corniche

UAE authorities have denied social media rumours that a commercial plane in distress landed on the Fujairah Corniche and clarified that it was there for commercial purposes before being shipped to Bahrain.

On Monday night, social media was abuzz with rumours about the wingless Boeing 747 after pictures and video were taken of the aircraft being transported by trucks along the corniche.

According to the state-run WAM news agency, the Fujairah government has clarified that the out-of-service aircraft was there with the government’s knowledge “for commercial purposes”.

In the coming days, WAM added, the aircraft will be transported to Bahrain.

Additionally, UAE officials have urged local residents to avoid spreading rumours on social media that are based on incorrect information.

Once in Bahrain, the aircraft will be used as the centrepiece of a recently announced 100,000 square metre underwater theme park.

Earlier this week, Bahraini authorities said that the 747 will be the largest aircraft ever submerged.

In a report, the Bahrain News Agency said that the site is being designed as a dive experience.

Other features will include a submerged replica of a traditional Bahraini pearl merchant’s house, artificial coral reefs and other sculptures that have been placed underwater as a safe haven for coral growth and as a habitat for marine animals.

For all the latest transport news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.

Etisalat becomes first MidEast company to break $10b brand portfolio value

Etisalat has become the first Middle East group to break the $10 billion barrier in terms of wider portfolio value, the company announced on Tuesday.

With the achievement, Etisalat won the “most valuable portfolio brand” title from brand consultancy Brand Finance.

Around the world, Etisalat’s portfolio includes brands such as Etisalat Misr, Mobily, Ufone, Maroc Telecom, PTCL and Etisalat Afghanistan, and in the last year has seen 8 percent growth.

For the second consecutive year, Etisalat also retained its positon as the most valuable consumer brand in the Middle East and Africa.

“We are proud to achieve the recognition as the most valuable portfolio brand and the first Middle Eastern brand to break the $10 billion barrier in terms of wider portfolio value in the MENA region,” said Saleh Abdullah Al Abdooli, CEO of Etisalat Group. “Thanks to the UAE leadership’s support, vision and encouragement that helped Etisalat achieve this significant milestone surpassing some of the top renowned regional brands.”

Etisalat attributes its success in 15 markets to its efforts to develop customer loyalty programmes, sports sponsorship commitments and in using digital technology to empower societies.

“It is a real testament to the leadership of the UAE that Emirati brands are leading the charge for the Middle East amongst the world’s most valuable brands,” said Brand Finance CEO David Haigh.

For all the latest tech news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.

Game changers: Liverpool FC

Ninety minutes is a long time for a millennial male to sit down on a couch,” Liverpool Football Club CEO Peter Moore tells an auditorium full of visibly horrified football professionals. “When I look at viewing and attendance figures of millennial males, I’m concerned as a CEO of a football club that relies on the next generation of fans coming through.”

Despite being chief executive of one of England’s most storied and beloved clubs – and one that currently sits atop the Premier League standings – Moore’s concerns don’t come in the form of rival teams, injured players or losses on the pitch. What keeps him up at night, he says, is Fortnite, the $15bn a year, free-to-play video game taking the world by storm.

“If we don’t build technological prowess as a club we will lose them [young fans],” he adds, with a slight hint of alarm in his voice. “There’s so much pressure on time now and only 24 hours in a day, [and] there are only so many hours to play Fortnite.”

This battle for young people’s attention, fought on the TV screens and electronic devices of youth around the world, is just as important as any match against the likes of Manchester City, Tottenham, Chelsea or Arsenal, says 64-year-old Moore.

A Silicon Valley approach to Anfield

Moore’s unlikely route to his current position as the club’s CEO has given him the expertise on the addiction-like hold of electronic entertainment on the minds of today’s young people. He was born and bred in Liverpool, the son of a nurse mother and a father who made a living as a freight worker. After two decades at sports footwear and apparel company Reebok, Moore took a job at the Japanese video game firm Sega and eventually rose to be president and chief operating officer of Sega of America. After that came stints as corporate vice president of Microsoft’s interactive entertainment division and as head of Electronic Arts’ sports division. In February 2017, he came home to Merseyside.

We are an industry that needs to harness technology to make sure we don’t miss an entire generation of young people growing up that don’t have that love for football

It is this background, Moore says, that is guiding his approach at Liverpool. “We are an industry that needs to harness technology to make sure we don’t miss an entire generation of young people growing up that don’t have that love for football,” he says. “We need to package content in bites of 60 to 90 seconds to keep their engagement.”

So far, Moore’s efforts have paid off: the club surpassed the 10 million-follower mark on Instagram in October (it has now reached 11.6 million), the same month that it received the most total interactions in world sport, surpassing both Barcelona and Manchester United. Additionally, the club had the highest YouTube viewing figures in the Premier League, and remains the most followed UK account on the global video platform. It ranks fourth in world football.

Success on the digital pitch, Moore explains, can be measured by examining the relationship between a fan’s ‘cost of acquisition’ and lifetime value. “What does it cost me to go get you? I want your name, your gender, your e-mail address. If I can get your credit card number, that’s a huge plus. What does that cost?” he says. “And then, what are you worth to me as a fan [in terms of] lifetime value?”

A fan’s lifetime value, he goes on to explain, comes through a variety of different streams. Fans might buy team apparel through e-commerce platforms, subscribe to the club’s on-demand video service, LFCTV GO, or better yet, head to Liverpool to see the Reds play at Anfield.

Moore, whose accent sounds perhaps more Californian than Scouser after years of living abroad, adds that the club’s approach to digital outreach rests on a simple principle common to many businesses: know your customer. To this end, Liverpool is working with American multinational tech giant IBM to optimise websites, build global apps and generate content that is timely and relevant to individual consumers.

“That’s something I learned in video games. I can push you all kinds of stuff on particular players, but if you’re only interested in [striker] Mohamed Salah, and I don’t know that, my outreach is wasted,” he says. “You might like [midfielder] Gini Wijnaldum. The more we learn about you, the more we can push Gini Wijnaldum stuff that you’ll click or engage. The key is that I need to know who you are.”

The Mo Salah effect

In the Middle East, Moore’s digital outreach efforts received a welcome boost in the form of Mohamed Salah, the prolific 26-year-old Egyptian striker who transferred to Liverpool from AS Roma in 2017.

“The moment we signed Mohamed, straight away we looked at our social media platforms and you could look at IP addresses and immediately see [a spike in followers], in particular from Egypt,” he recalls, smiling at the thought.

“But there is a pan-Arabian pride from all people in the Middle East, regardless of whether you are Egyptian. We saw Jordan, and we obviously saw the UAE. It breaks down some of the barriers in this region when it’s an Arab player that is playing, and not only playing, but arguably one of the best players in the world and scoring goals for fun.”

Salah, Moore adds, has quickly become a fan favourite on the club’s social media channels, largely due to the often-humorous posts illustrating his relationship with Liverpool centre back and Croatia international Dejan Lovren.

As an example of the boost that this relationship – which Moore laughingly compares to the 1970s TV series ‘The Odd Couple’ – he points to a recent post from Lovren in which the Egyptian wished Lovren a happy new year, only to sheepishly confess that he was only reaching out to find out what time training was scheduled for the following day.

“Their ability to share their ‘bromance’ is hilarious. They publish texts from one another on their social media platforms and get millions of views,” he says. “This is the kind of ongoing sitcom that the fans love, in the millions of people.”

Liverpool first

Despite the global appeal of the club and Moore’s efforts to reach and create fans abroad, the city of Liverpool remains at the heart of what the club does. Every decision he takes is taken with the city’s best interests at heart, Moore says. Under his leadership, the club’s ‘Red Neighbours’ outreach programme placed 152,000 local children in community programmes during the 2017/2018 season. It served 450 free Christmas lunches for pensioners, donated 1,100 free tickets to children and did a host of other good deeds.

As Moore sees it, the local fans form part of the club’s unique selling point compared to other teams, and boost the club’s appeal to the international fans he hopes to attract. “We trade on our local fans. We trade on ‘You’ll Never Walk Alone’,” he says, referring to the 1963 song from the Liverpool group Gerry and the Pacemakers, which masses of Reds fans sing during matches. “The atmosphere is generated by local fans…the massive majority [of people at games] are local people.”

We have thousands of people who fly in from all over the world to watch Liverpool play, and that has a positive economic impact on the city

Moore adds that local people are “advantaged”, with fans living in certain postal codes offered tickets on priority, and at bargain prices as low as £9 ($11.60). “We wish we could do more,” he remarks. “We have this hugely positive problem that demand for tickets far outweighs our ability to put everyone in the stadium that wants to be there. Not every club has that problem. It’s a high-class problem to have.”

It is local people – whether they are supporters or not –  who will benefit from Moore’s digital outreach in the event that international fans take the plunge by buying a ticket to Liverpool and watch a game in person.

“That’s huge, not only for Liverpool Football Club, but for the city. We have thousands of people who fly in from all over the world to watch Liverpool play, and that has a positive economic impact on the city,” he says. “Liverpool still has socio-economic challenges. So if we can bring fans, both local and global, into the city, there’s a value. Technology powers that… it’s not cheap, [but] it is a long-term investment.”

A ‘priceless’ win

At the time of writing, Liverpool stands in first position in the Premier League standings, four points ahead of Manchester City despite losing 2-1 to the reigning champions on December 4. Although many analysts have predicted that the 2018/2019 season may end with Liverpool winning the Premier League for the first time, Moore is surprisingly nonchalant about the economic benefit that will have for the organisation, saying he “isn’t sure” what a victory would mean in monetary terms.

“It goes back to long-term value. I know from a media or distribution value what happens when you come first, but I don’t know [the immediate impact] and we don’t think about that,” he notes. “You don’t think about this as a £5m ($6.4m) cheque that you may get for winning the Premier League. You think long-term, that we can finally put a Premier League logo on the walls of Anfield to go with the 18 First Division championships and five European Cup championships we’ve won. In five or 10 years’ time, should that happen, we’ll look back on this moment.”

To illustrate the difficult-to-measure potential boost to the Liverpool brand, Moore points back to Liverpool’s 2005 Champions League victory in which the team defeated AC Milan in penalty kicks after coming from behind to draw 3-3 in regular time.

“I don’t know what cheque UEFA [the Union of European Football Association] wrote for winning that night. It doesn’t matter,” he says, proudly. “The memories that created and the brand enhancement of being down 3-nil to arguably the best club team in the world at that moment and then coming back to win was priceless.”



Not for sale

While CEO Peter Moore is unequivocal in saying that Liverpool is not for sale, he says that the club remains open to offers from groups or individuals interested in acquiring a minority stake. “[The club] is not discourteous enough to discount people who say they are interested,” he notes. “The club has made it very clear that if the right partner is interested in a minority stake, they would consider that.”

In late August 2018, it was reported that Liverpool owners Fenway Sports Group (FSG) turned down a $2.6bn takeover bid from a cousin of Manchester City owner Sheikh Mansour, Sheikh Khaled Bin Zayed Al Nahyan. At the time, Britain’s Press Association said it understood that the offer – one of a number of approaches FSG has received in recent years – did not go further than the vetting stage because it was deemed to be neither credible nor worthy of being put to the ownership.



Looking for partners

According to Moore, Liverpool will be “entertaining offers” from kit suppliers after its current relationship with American company New Balance ends at the 2019/2020 season, a deal that is reportedly worth $57.8m each year. The expected value of the new partnership is expected to be aligned with other top UK clubs at around $96.3m.

“It’s an important part of our overall commercial make-up, not only for the revenue it brings, but live-and-die soccer fans [care] about their kit manufacturer and designs as part of how they show themselves as fans,” he says. “We think we are uniquely placed right now to build upon what we already have with New Balance… we think it’s a great opportunity to build on our global distribution.”



For all the latest business news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.

Almost $30bn in hotel construction contracts to be awarded by 2023

Nearly $30 billion worth of hotel construction contracts will be awarded in the Middle East and North Africa between now and 2023, according to a new forecast from the Arabian Hotel Investment Conference (AHIC).

According to the research conducted by MEED projects, hotel development is most active in the UAE, Egypt and Saudi Arabia, with the UAE alone accounting for more than $20 billion worth of hotel construction contracts since 2012.

Saudi Arabia, for its part, has accounted for just over $10 billion worth of hotel deals in the same time period.

In the next five years, an additional $30 billion worth of contracts are due to be awarded, with the UAE accounting for $11 billion.

“We’re excited to hear…that the value of future hotel investments in the region is only going to get larger,” said Jonathan Worsley, chairman of bench events and founder of AHIC. “That said, increased supply brings a unique set of challenges.”

Worsley added that “tourism has boomed in the MENA region as a result of governments’ commitments to diversifying their economies.”

“Relaxed visa regulations, enhanced marketing and investment in key attractions and events such as Louvre Abu Dhabi, Dubai Parks and Resorts and the Bahrain and Abu Dhabi Grand Prix have helped drive a record number of tourists to the region,” he said.

AHIC will take place in Ras Al Khaimah between April 9 and 11 at a purpose built “AHIC Village” on the grounds of the Waldorf Astoria.

For all the latest construction news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.

Bahrain to open world’s largest underwater theme park

Bahrain plans to construct the world’s largest underwater theme park with a submerged Boeing 747 as its centrepiece, it was announced on Saturday.

According to the state-run Bahrain News Agency, the underwater theme park will eventually cover a total area of 100,000 square metres.

The eco-friendly project, which was announced by Bahrain’s President of the Supreme Council for Environment, Sheikh Abdullah bin Hamad Al Khalifa, is the result of a partnership between the council, the Bahrain Tourism and Exhibitions Authority (DTEA) and the private sector.

The diver site will feature the 70-metre long 747, the largest aircraft ever to be submerged.

According to the BNA, the site is being designed as a dive experience. Other features will include a submerged replica of a traditional Bahraini pearl merchant’s house, artificial coral reefs and other sculptures that have been placed underwater as a safe haven for coral growth and as a habitat for marine animals.

In a statement, Sheikh Abdullah said that Bahrain believes the project will attract diving enthusiasts from around the world, as well as help researchers obtain information and data on marine ecology and biology.

The site will be launched “in the coming” weeks and will open to divers and visitors before the summer, according to the BNA report.

For all the latest travel news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.

‘Saudi Arabia will come back stronger than ever’ says King Abdullah Port boss

With a bird’s eye view of the country’s import and export activity and logistics investments, King Abdullah Ports (KAP) CEO Rayan Qutub is confident that the country is on the brink of a “new wave of growth.”

“Saudi Arabia will come back bigger and stronger than ever,” he told Arabian Business in an interview while in Dubai last week.

“We’re an oil-based economy going through cycles that have always existed. But with Vision 2030, the country will emerge dramatically different,” he said.

The sole privately owned port in the country, KAP is the country’s largest and fastest growing. In 2018, the company saw a 36 percent growth in its container business while its breakbulk operations grew to roughly four times the average handling rate of ports in the region.

“What works to our benefit is our accessibility to local markets. We’re at the main corridor of the Red Sea through which 26 percent of the world’s container business flows. Our immediate domestic catchment area of 3 million people is one of the highest GDP per capital catchment areas in the world. And we’re opening up to more markets as well, in a booming East Arica as well as around the Red Sea,” he said.

Economic headwinds such as a slowing of growth in China, oversaturation of ports in the Arabian Gulf, and trade talks between the US and China unable to resolve differences over tariffs could see a “spillover” into both KAP and Saudi Arabia’s fortunes, Qutub acknowledged.

“We’re part of the global economy… and in any challenging economic times, people are looking for better, faster and cheaper more convenient solutions,” he said.

However, Saudi Arabia’s Vision 2030 plan to diversify economic revenue sources “is a dynamic top-bottom and bottom-top initiative,” that Qutub said is “seeing support from all government entities.”

“These are national level goals, of which the logistics industry is a major pillar to deliver that transformation,” he said. “With strategic invesments we’re beginning to see a new wave of growth in the country.”

For all the latest transport news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.

Waldorf Astoria DIFC to open in Spring 2019

The Waldorf Astoria Dubai International Financial Centre (DIFC) is set to open in the Spring of 2019.

The 275-room property in the financial district comprises 201 guest rooms, 46 suites and 28 residential apartments. It overlooks the Dubai skyline through floor-to-ceiling windows in every room.

Evoking the elegance of the early 1960’s New York, the Waldorf Astoria DIFC is described as a “cutting-edge, urban retreat” with bespoke services and elevated culinary experiences.

It boasts three dining options and bars including Bull and Bear restaurant, the hotel’s signature restaurant, as well as rooftop lounge St. Trop and the Waldorf’s iconic Peacock Alley Lounge and Bar.

It also features state-of-the-art spa and fitness centre facilities as well as meeting spaces, featuring a dedicated Business Centre, Ballroom and Library among three other flexible meeting spaces. 

Waldorf Astoria DIFC is located at Burj Daman on Happiness Street, just a few minutes’ away from The Dubai Mall and Burj Khalifa and 12 minutes by car from Dubai International Airport.

Waldorf Astoria Hotels Resorts has a portfolio of 30 properties around the world and is part of leading hospitality company Hilton.

For all the latest travel news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.