Comment: External drivers
The UAE is a haven for large-scale hotel operations and resorts, and many hotels offer upwards of 10 F&B outlets on their property. To create concepts, manage operations, promote and engage with consumers in innovative ways on that scale can be difficult for hotels.
There are obvious economies of scale with regards to cost, however, there are dis-economies of scale in areas of SOPs, creativity and atmosphere in many cases. Ask any F&B director and I’m sure they will tell you privately that they have some concepts that they cannot, despite their extensive experience, make work.
Hotel branded experiences have lost some prestige in recent times and the rise of a more organic, crafted, soulful and boutique experience is what the modern guest demands. Craft beer brands versus large international brands is a great analogy for this on the global market in recent times. The growth of craft beer is astonishing. A similar shift is becoming more evident in the UAE for F&B concept offerings, but it hasn’t been all free and easy to get there.
In the UAE, large hotels have changed their approach over the last five to 10 years to lease their unwanted spaces to independent operators. Some hotels may have been too proud to lease their space in the past but pride has given way to pragmatism and commercial gains. Some hotels have always had external operators but it really started to become evident that something was happening with the growth and success of the independent licensed venues in the DIFC circa 2008. Renowned international concepts like Zuma and La Petite Maison struck a chord with the Dubai audience and serviced the growing demand for marquee stand-alone experiences. Hotel operators recognised the increasing attraction that the independent mindset brought to the market.
Free-spirited operators brought a level of chic and consumer satisfaction to the market while not having to adhere to name badges and bureaucracy, whilst still delivering a five-star experience. Hotels had to break from their norm and share their pie with external brands if they wanted their properties to stay attractive.
In 2009, Jumeirah showcased its new approach by bringing Mahiki to a struggling nightclub space on its property with great success. Mahiki was a marquee signing for Jumeirah, having an international and aspirational brand name. The incumbent needed a licence and prime real estate to operate and the licencee needed to make revenue and cut costs with a problem child space. It seemed like a win-win, and the floodgates opened across the city.
Hotels see the sense in this model now, some with more success than others but it opened the market up for competition and innovation. While there are many imported concepts and brands operating in these areas, there is also a noticeable uplift in original ideas and homegrown concepts. Recent newborn success stories operating independently in hotels include venues such as Nola, Little Black Door and Rüya. The venues now operating with success in the UAE are many strands different from what was mostly on offer in hotels 10 years ago.
We are now seeing the rise in the UAE of the market savvy, original concept that is trendsetting. Hotel F&B departments and external concepts now have a clearly defined symbiotic relationship that can lead to success, but the curious consumer is the ultimate winner.
Colin Hutton is the founder of Umami Communications, a boutique marketing and PR agency geared towards the luxury lifestyle and F&B industries in the GCC. Visit www.UmamiComms.com for details.