Holiday spirits boost shopping festival

More tourists are participating in this year's Dubai Shopping Festival, thanks to heavy discounts on merchandise and rooms.

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DUBAI // More tourists are participating in this year's Dubai Shopping Festival, thanks to heavy discounts on merchandise and rooms as well as the event's good timing, retailers and hotel operators say. Retailers said their sales during the 32-day event, which ends today, were up as much as 40 per cent from last year, while hotels were reporting higher occupancy rates.

Nilesh Ved, the chairman of the Apparel Group, whose stores include Aeropostale and Aldo, said the school holidays in neighbouring GCC countries and other events elsewhere allowed more tourists to join in. "It's the Chinese New Year, the Gulf holidays, tourists from India, it's Kuwait and their Liberation Day; everything together is bringing people into the malls," he said. Mr Ved said that while sales had not reached the peaks of 2008, he estimated his group's sales were up 41 per cent compared with last year. "Those were the honeymoon years," he said. "I still think we are far away from that, but it has improved."

The festival, with its mix of entertainment across the city and discounts at shops, is a major driver for retail sales and tourism in the emirate. This year, 6,000 retailers and 50 malls are taking part in the shopping extravaganza. With just today remaining, mall operators and retailers say they are already ahead of last year. Laila Suhail, the chief executive of the Dubai Events and Promotions Establishment, which has organised the festival, said all the holidays and special occasions in their target markets were taken into consideration. While final visitor and spending figures were not yet available, early indications were positive, she said.

Tom Miles, the general manager of Festival Centre at Dubai Festival City, said the number of visitors was up between 30 and 40 per cent this year. Given the economic climate, however, people were not necessarily spending more than they did last year. "Anecdotally, there has been increased sales, but it's not gangbusters," he said. "That goes again back to consumer confidence. The more confident you have a job in the future, the more liberal you are with your dirhams. But, it was better this year than last year."

Retailers say they spent more on promotions this year, or offered discounts on more items to attract customers. Hoteliers in Dubai also used aggressive discounting and promotions this year to attract thrifty visitors and boost occupancy levels at a time when competition was fierce due to an increase in the number of hotels and a decline in demand from western Europe.

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"February has been a very good month," said Nasser Fawzi, the director of sales and marketing at Kempinski Hotel, Mall of the Emirates. "The beginning of the month was a bit slow, but from February 10 the pick-up was very good." He said the hotel had attracted more guests than expected this year, largely as a result of promotional packages. "The occupancy was 77 per cent in February 2009 and is expected to hit 81 per cent this year. The GCC holidays which started in Saudi Arabia followed by Qatar and Kuwait pushed Dubai's figures up."

Arshad Hussain, the director of business development at The Monarch Dubai, agreed that special deals and the GCC holidays had been a massive help, with occupancy this month at more than 80 per cent. "The business from the Saudi market has been strong during the Saudi Holidays in February and we have seen strong growth in the Indian market," he said. Last month, the consultancy STR Global said December hotel occupancy levels rose to 71.9 per cent from 64.3 per cent in the same period in 2008, although room rates fell. Average daily rates were down to US$244.32 (Dh897.40), from $324.02.

DEPE also launched a package to bring more tourists to the emirate. It offered a discount of 40 per cent on hotels' maximum rates, as well as reduced airfares, free breakfasts, shopping vouchers and free transfers to airports and shopping malls.