Agile in a fluid situation
The luxury hotels in the Middle East are often in a class of their own.
Renowned for flawless service and first-class facilities, the region’s enormously successful hospitality sector has set a global benchmark for excellence and selling people a dream!
But no business is immune to events in the wider world and even the most prestigious brands there are facing a period of unpredictability due to the regional conflict.
The economic effects are being felt in the economy in a meaningful way. As a result, forward-thinking hoteliers are pivoting their focus inwards – in particular, they are looking at how selling gift vouchers can work for them during this time.
SK Chase works with a number of hotels in the GCC, including Jumeirah Hotels, Marriott Hotels and InterContinental Hotels & Resorts and are in discussion with them around running targeted gift voucher campaigns that capture the attention of the domestic market to improve revenue and occupancy during this time.
Regional guests central to resilience
At a briefing by Arabian Business, senior tourism and aviation executives said domestic and regional guests are becoming central to resilience, not just a stopgap during disruption.
Phillipa Harrison, CEO of Ras Al Khaimah Tourism Development Authority, said domestic tourism had long been a key market for the emirate, accounting for around 50 percent of business before the current disruption. During the crisis, she said that figure rose to 95 percent.
‘Domestic has always been really important for Ras Al Khaimah,’ Harrison said. ‘We really just doubled down on that over the pandemic, over the last couple of months, and we’ve seen some really great results.’
She said the market had helped keep the emirate’s tourism industry going during the period, while also underlining the need to treat domestic travellers differently from international visitors.
‘They need more new interesting things to keep them coming back,’ Harrison said.
So what can hotels do?
Venues can position vouchers to the local market as premium gifts for birthdays, celebrations, anniversaries, congratulations, thank you’s and themselves, creating a revenue stream that doesn’t rely on international travel. This has been working especially well across the gifting categories of monetary, dining and spa.
Craft high-margin ‘micro-experiences’ for the local market
Luxury hotels can boost cashflow by repackaging their world-class amenities into bite-sized, experiences tailored for residents living locally.
These vouchers can be set up with a limited redemption period and venues can limit the amount that they would like to sell, so that they can easily manage demand. Many venues include terms and conditions that restrict usage to specific days (for example, Monday to Thursday only) within a defined timeframe, helping to optimise occupancy during quieter periods.
Additionally, overnight stay or day pass gifts can include a ‘spend towards’ element for food and beverage outlets, naturally guiding incremental spend.
Hotels are also engaging the local market with premium day-pass vouchers, including exclusive pool and beach access, 2-for-1 luxury spa treatments, and high-end themed brunch experiences. This keeps food & beverage and spa operations active, without the overhead costs of servicing rooms.
Launch ‘buy now, stay later’ incentives
During periods of cautious travel sentiment, domestic residents and expats look for premium experiences closer to home. We saw this trend play out powerfully in markets like London during the pandemic: hotels that actively courted the staycation market successfully offset the drop in international tourism.
Properties are introducing high-incentive monetary and accommodation vouchers. This includes offers like ‘Purchase a voucher for AED 1,000 and receive AED 1,500 in resort credit,’ or offering exclusive staycation packages with ultra-flexible, extended validity windows (such as 18 months). This generates immediate working capital. For local residents who know they will eventually want a luxury getaway or a high-end dinner once conditions settle, it presents an irresistible, high-value proposition.
Capture high-value corporate orders
Gift-giving remains a powerful tool for connection, gratitude, and corporate culture. Even during quieter trading periods, businesses look for meaningful ways to reward top performers, incentivise clients, and celebrate milestones.
By offering a seamless B2B voucher solution, hotels can tap into bulk corporate orders. Digital corporate vouchers provide businesses with an elegant, instant gifting solution while securing large-scale, upfront revenue for their property.
From a financial perspective, a sophisticated gift voucher strategy delivers two hidden, highly lucrative advantages to a hotel’s balance sheet:
- The breakage benefit: Statistically, a notable percentage of gift vouchers are misplaced, forgotten, or allowed to expire. This ‘breakage’ ultimately converts into 100% pure profit margin for the hotel, requiring zero labour or operational overhead.
- The slippage effect: Data shows that when guests do redeem their vouchers, over 60% end up spending significantly more than the voucher’s face value. Whether it is ordering an extra bottle of wine, booking a spa treatment, or upgrading their room upon arrival, vouchers serve as the ultimate gateway to high-margin upselling,
A revenue stream
If you’re a hotel in the GCC and want to unlock a new revenue stream with online gift vouchers, we’d love to help.
Don’t wait for the ‘perfect’ time to launch. Getting your gift voucher site live now means you can start generating sales immediately while also investing in your future visibility.
