A shift in global economic power, demographics and digitization were among the topics discussed as part of the opening session of the Arabian Hotel Investment Conference 2017 in Dubai.
The conference, which started yesterday and ends on Thursday, is being held at the Madinat Jumeirah; more than 700 people are attending. These notes were provided by the conference.
The topic of technological breakthroughs, such as AI, was identified as one of the top five megatrends by PwC Middle East’s partner and deals real estate leader Dr. Martin Berlin. Others included the demographic shift to millennials and Generation Z; that emerging economies are expected to surpass advanced economies in terms of international tourism arrivals by 2020; the growth of “megacities”; climate change, which is expectd to impact the attractiveness of the Middle East as a destination; and tech issues such as connectivity.
As Dr Berlin explained: “The travel and tourism industry has witnessed rapid and fundamental infiltration of digitization across the entire value chain. Combined with the demographic and social change, the digitization will lead to a change of the ‘delivery’ of hospitality products and services.”
The trends shaped the conversation in the opening panel session featuring Stefan Leser, group CEO of Jumeirah Group; Olivier Harnisch, CEO of Emaar Hospitality Group; Steven Daines, CEO new businesses and CEO hotel services Africa and Middle East for AccorHotels; Alex Kyriakidis, President and MD, Middle East and Africa, Marriott International; and Robert Welanetz, CEO, Majid Al Futtaim Properties and acting CEO of Majid Al Futtaim Hotels. The panel was moderated by Berlin.
Referring to the five PwC trends, Kyriakidis said: “To take a couple and put them on the top, unquestionably there would be technology and not just its impact on the guest and the consumer but also on the way we operate. The second trend [to highlight] would be demographics – the changing demographics and what does that mean for technology and everything else that we do”.
Harnisch, who took up his role at Emaar on March 1, said he was interested in the potential of IoT and near-field communications to “really change the nature of our guests’ stay”.
Leser said he was focused on using IoT and digitization, which he referred to as Industry 4.0, to enable Jumeirah Group “to run hotels in a very different manner”, using predictive maintenance in favour of preventative maintenance as an example.
Accor’s Daines said he believed there is a “disruption going on that is much wider and much deeper” regarding the way that consumers look at travel and hospitality as a whole.
On the subject of planning and preparation, speaking from the investor’s perspective, Robert Welanetz, CEO, Majid Al Futtaim Properties, said he believed owners and operators faced a big challenge considering the vast investment technology required versus the risk of its “shelf-life until the next best idea”
Here, Leser urged the industry to focus predominately on the impact of the technology, not the timing of it.
“In my role as CEO I need to make the calls about where the true impact lies. I need to be right on the impact, I don’t need to be right on the timing. If there is one conclusion out of the last 10 years of technology, a lot of times you have underestimated the impact and you have overestimated the time of arrival and I think that is one of the conclusions that we need to be right on”.