Business Planning in Int’l Markets -

Product Entry Plan in Dubai

Group 6, IIM Bangalore
Amanpreet Singh (1611153)
Dnyanesh Katakdaunde (1611168)
Shreyas Joshi (1611251)
Kunal Bindra (1611255)
Mayur Vikani (1611257)
Prince Jain (1611272)
Executive Summary
Hotel Industry Value Chain
• The Opportunity: The domestic pharmaceutical industry is a long-established global
leader in the production of high-quality generic medicines . …

• Support: Government’s ‘Pharma Vision 2020’, targeted at making India a global leader in
…

• Risk Profile: A typical feature of Pharmaceutical companies is that risk significantly

differs across the phases of its value chain, being highest in early stage financing,
gradually reducing as we further the value chain. The reason being uncertainty in
product success. Hence, typically, legal entities operating in each of these….

• Key Risks & Mitigation: Key risks are two-fold: one, in terms of varying regulatory
standards required by India and export markets which could be mitigated by
move……………
Dubai Market and the Hospitality Industry in Dubai
Key Trends in Hospitality Industry in Dubai
I. High demand and Sustained growth in tourism volumes
• Expected rise in demand: Dubai’s Department of Tourism expects occupied room nights in hotels and hotel apartments to
grow at a CAGR of 11-12% through 2018
• Upcoming major events: Major events like Expo 2020 in Dubai, FIFA World Cup in Qatar are driving additional tourists
• Occupancy rates: Despite a 40% expected increase in capacity, occupancy rates are predicted at 77% (one of the highest)
• Positive Externalities: Increasing connectivity, primarily by Emirates and expanding overall length of stay.

II. Shift in consumer preferences [Mid market (3*) growing at 16.8% vs Up market (5*) growing at 11.6%]
• Increase in Source market: The source market not only includes Saudi Arabia but India and China also
• Rise in Chinese: Chinese tourists rose by 29% in 2017, trend expected to continue till 2021 based on Chinese Travel Report
• Emerging Millennial Travellers: Millennials prioritize quality over luxury; also prefer trendy and technology friendly hotels to
large impersonal rooms
• Increased competition: Opening of several properties and pressure on travel budgets driving down average hotel rates across

III. Existence of cultural cohorts and lack of opportunity to mingle / interact

• Multiple nationalities: Over 200 nationalities co-exist peacefully alongside one-another in UAE
• Missing Bridges: UAE has provided an opportunity for multiple nationalities to come in but they have developed their own
community enclaves that do not allow outsiders in.
• Lack of Active intervention: Initiatives, by the hospitality industry in Dubai, to encourage cross-cultural interaction are limited

Need-Gap: Emergence of the millennial traveller segment with needs to explore multiple cultures & interact with people from
different cohorts has given rise to a need for concept mid-market stays, whereas the market is yet to offer any such arrangement.
The Concept (Product) & How do we deliver it?
Product (Extended): Experience across the traveller value chain
Business Model, in brief

Revenues Expenses Profits

….. ….. ~ 20%
Identifying the Target Customer & How to Target
Existing Player Profiles (Competitive Landscape)
Player Profile Description of Size and Scale Business Model Key USP
Dubai Market Validation and Sizing

TAM SAM SOM

14.87 Mn 5.2 Mn 0.1 Mn
visitor-nights visitor-nights visitor-nights
8% Shift

- Top source markets include Travel Purpose % share (Dubai) - @ 2% market share
Saudi Arabia, India, UK, Cultural Pursuits 10% - Competition with AirBnB,
USA, Iran, Oman, China Apartments, 3* hotels
Social Capital Seekers 25% - Current occupancy levels @
- Average stay 3.84 days
Obligation Meeters 30% 86%.
Reward Hunters 35%

Target Market Size: SOM X Average daily room rate @ 30 USD USD 3.1 Mn
Critical Risk Factors in this model
Summarizing: Product Launch in a Global Market
• … • Using internal capability/ platfo
• Models • Models
• …. Ethnic Context Global Context • ….
• ….

Product
Ethnic
…. ….

Product
Global
…. ….
• Outsourcing to …. • Share financial risks of devel
• Models • Models
• … • ….
• … • ….
THANK YOU!
ANY QUESTIONS?
References