Monday, July 14, 2008

Market Segments for Bahrain Hotel Industry

Today, the market for travel and leisure activities is growing throughout the GCC countries. Business travellers are also predicted to grow significantly in the next coming years.

Saudis account for the vast majority of visitors to Bahrain, who are attracted to the country largely because of its traditionally liberal attitudes to entertainment, leisure and recreation attraction. More than three-quarters of visitors to Bahrain enter via the King Fahd Causeway from Saudi Arabia. However, competition from Dubai for high-spending European visitors is intense. In 2006, Bahrain had 7.5 million visitors, with average tourist stays only two nights, reflecting the prevalence of weekend visits.

Based on my study, below are the major segments of tourism and travel market in Bahrain. I think, the characteristic will be applicable for other GCC countries. The segment market for tourism and travel industry is generally divided into four categories, business travellers, leisure travellers, F1 season and weekend excursionist.

Business travellers are divided into two sub-segments. They are individual business travellers and grouped business travellers. Individual business normally consists of people who travel from GCC countries to visit Bahrain for business purposes, and some percentage of European businessmen who have regular meeting with clients. Mostly they are executives or top management in the company who travel frequently to Bahrain. Some of them are owners of small to medium scale enterprises whom due to expansion of the company, they need to travel aboard.

Grouped business travellers have large proportion to fill up the market share in Bahrain MICE industry. Under “corporate account”, most hotels in Bahrain put a special attention to attract this market. Generally, corporate account is divided in a 10 percent from government and 90 percent from private companies. A 50 percent of private sector is supplied from companies in Bahrain, 30 percent from Saudi Arabia, and the rest is distributed from other GCC countries. This segment is used to using room and banquet services.

In addition, Bahrain is a host for international business events such as exhibition, conference and expo. Bahrain hosts 20 to 25 local and world’s scale events every year, which attracts a huge number of both individual and group business travellers. A 20 percent of the current market segment of Novotel Al Dana Resort is derived from people who attend those events. Although most of them do not spend expenses for banquet service, but their expenditure in room and F&B is considerable valuable contribution for the total sales.

Leisure travellers are classified into two sub-segments; individual leisure and family. Individual leisure travellers are mainly young people from Saudi Arabia, Kuwait, Qatar and UAE. They travel purely for vacation and wish to enjoy holiday packages offered by travel agencies or visit family, shop and relax in the less restricted social environment, such as alcohol, cinema and even illegal prostitution.

Bahrain has been also famous as a family oriented destination. The family segment usually contains of the parent and two children or more. This segment usually visits Bahrain during school holidays and especially summer time which normally happens in July to August, yearly. Some families also tend to spend their vacation during weekends and other public holidays such as Christmas, Ied Fitr, New Year, and Valentine.

Weekend Excursionists are one of potential customers for most hotels in the kingdom. They are mostly categorized into three major groups, young couple or young people, family and expatriates. They do not use the room but spend noteworthy expenses in F&B service, leisure and recreation facilities.

Bahrain has maintained a pro-Western stance since independent. There are roughly 8,500 British expatriates in Bahrain, employed mainly in finance, construction and the government. Other European and American nationals have contributed significant numbers of expatriates living in Bahrain, making themselves as potential market for hotel and leisure sector.

F1 season is one of the greatest events that everyone expects in Bahrain. With over $540 million entering the economy during the Grand Prix, Bahrain has emerged as a focal point in the marriage of sport and business. The F1 Grand Prix has a huge impact to the room sales of all hotels and lodging properties in Bahrain. Since the last four years, Hotels in the kingdom have enjoyed double price of its room rates solely for F1 teams such as Renault, Ferrari, BMW Sauber and the F1 spectators not only from GCC countries but also countries around the world.

According to FIA Formula One World Calendar, Bahrain will continue hosting the prestigious event till 2016. This is good for the region and hotel industry in term of entertainment, business and tourism. The revenue for hotels during the F1 season is forecasted to double within 3 coming years.

On the final note, as an hotelier who is currently working in Bahrain and experienced working with Bali Tourism Board, I am just jealous to know Bahrain tourism is booming with tourist arrival reaches more than 8 millions in 2005. All the market segments are drastically increase year by year and are predicted to grow progressively in the next 5 coming years. While Indonesia, with more resources and lots of beautiful places of interests can only attract 5 millions international visits. It's gloomy...

11 comments:

anton said...

then, after u got all experience in bahrain, i think u should back to bali or lamongan is okay also. :)

devari said...

bli Iqbal, btw is there backpackers in Bahrain? or just businessman travellers?

trancepass said...

anton,
no worry Anton, let me persue the position of Kadiparda Lamongan then i will invite you to plan tourism projects in our lovely Lamongan.

devari,
Although there are some budget hotels, there is no backpackers here. But there lots of individual leisure travllers which have different behaviour with the backpackers.

mercuryfalling said...

3 juta buanyak juga yak selisihnya hikhik...negara kita kurang diurus kale

trancepass said...

@mercuryfalling,
yup, while foreign visitors to Bali reaches only 1,6 million, Phuket in Thailand receives 3 million annually.

Indonesian Blogger said...

thanks for coming to my blog
lets we are share information about tourism

anton said...

ojo lali update mas. :)

Benazio R.P said...

well indonesia shud do more promotion to the world .. like now, visit indonesia 2008 is a good starter laah hehe

Eko Hariyanto said...

Muhammad Iqbal ????

Rasanya kok gak asing ya ?? Mudah2an gak salah ini iqbal yang kul di D4 Par Unud ya ?? Kalo salah mohon maaf. Salam kenal aja dech

balidreamhome said...

I think that there is lots of factors in regards to attract the traveler to visit our tourist object and surely is not an easy task as this effort has to be done collectively by lots of deference institutions and departments.

By factual our country is having a problem to maintain the level of visitor to Indonesia as still lots of home works we have to fulfill either infrastructure, mind set, people behavior and or it fragility of the tourism industry itself.

By the way, I am no longer actively work in Hotel business anymore, I have enough and here I am now running my own small business Channel1 (http://channel1.balidreamhome.com)

Wish you all the best and good luck buddy !!

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