Task 3: DUBAI & SINGAPORE Lohmann, G., Albers, S, Koch, B., & Pavlovich, K. (2009).

From hub to tourist destination An explorative study of Singapore and Dubais aviationbased transformation. Journal of Air Transport Management, 15(1), 205211.
Please discuss critically the development of both destinations with regard to your findings and experiences during your visit.

The growth of air travel industry and deregulation have allowed little known places like Singapore and Dubai to become a popular international tourism destinations. In order to achieve this position, both destinations took advantage of combining airline, airport and tourism planning. The role of airlines for tourism expansion is a complex field, which calls for vertical integration strategies with tour operators, accommodations, and other service industry sectors like car rentals, restaurants etc. (Lohmann et. al, 2009) Large airports facilitate tourism, an important industry sector that has been the focus of policy makers in Dubai and Singapore. If you have a very good transport hub it facilitates tourist arrivals as well, which is a sector we are diversifying into today, says Alvin Leiw, Standard Chartereds on-the-ground economic analyst in Singapore. (Anning, online) Both destinations are geographically located on long-haul routes between Asia, Europe and the Southwest Pacific. The extent to which Dubai and Singapore have and can establish themselves into a major tourism destinations goes far beyond than providing just a hub. (Lohmann et. al, 2009) I believe that they need to find a way how to attract people, have to concentrate on certain target groups, communicate their USP, market their destination according to these segments and need to differentiate themselves in order to give customers a reason not to go to the competitor.

According to the Singapore Tourism Board, the destination reached 14.5 Mio tourist arrivals in 2012. Also quarter one of the year 2013 looks very promising. All components in Leisure spend (except for Shopping) had an 8 % year-on-year increase. International Visitor Arrivals the first quarter in 2013 counted 3.9 Mio., registering a 9 % growth compared to the year before, with Indonesia, China, Malaysia, Australia and Japan as the top 5 source markets. (Singapore Tourism Board, 2013a & 2013b, online) Supported by its airline -Singapore Airline (SIA)- Singapore has quickly developed from a trading hub into a major financial centre and a leading tourism destination for stop-overs. (Lohmann et. al, 2009) Singapore airlines history can be traced back to 1st May 1947. At this time the airline Malayan Airways initiated the first flights between Singapore and Kuala Lumpur as well as Ipoh and Penang. In 1963 the airline was renamed Malaysian Airways and already in 1966 it was renamed a second time in Malaysian-Singapore Airlines. This airline was finally split in two parts in 1972: Malaysian Airline and Singapore Airlines. Nowadays, more than half a century later SIA has a network extending to 99 destinations in 35 countries, serving Asia, Europe, North America, the Middle East, the South West Pacific and Africa (Star Al liance Services GmbH 2012; Lohmann et. al, 2009). It operates from Changi airport and has a market share of about 40%. The airline follows a differentiation strategy by offering highclass service. Changi airport itself has a capacity to serve around 64 million passengers a year, whereas in 2012 the number of passengers arriving and departing counted 51.2 million. When the airport opened, 60% of earnings came from the airline sector; nowadays 60% come from non airline-related industry, like commercial activities , shopping in duty free zones, taking part in recreation activities etc. The airport became a "destination in itself". (Lohmann et. al, 2009) The success of the destination Singapore, can be derived from the fact that aviation and tourism business was integrated. Political and governmental support was given, in order to expand the tourism industry. One example that can illustrate the strong interconnection between airline, airport and other tourism services (restaurants, attractions, car rentals, etc.) is the "Singapore Stopover Holiday".

Nowadays Dubai, the city of Superlatives is the most visited country of the UAE with 9.9 million visitors in 2012. According to the Dubai Department of Tourism and Commerce Marketing (DTCM, 2013) the number will increase to 20 million in 2020. The average length of stay was 3.8 days and the occupancy rate exceeded 78%. (Dubai Tourism, 2013) An unique competitive advantage for Dubai is its geographic location at the route between Asia, Africa, Southwest Pacific and Europe. A crucial action for Dubais development was the foundation of the Emirates Airlines in 1985, which is the 4 th largest airline in the world. (Balakrishnan, 2008; Lohmann et. al, 2009) The Airline plays the key role in connecting the traditional Dubai as a trading point with important locations worldwide. Like SIA, Emirates Airlines follows a differentiation strategy, but with a very competitive cost structure. It is important to mention that the airline safes a lot of operating cost by low fuel prices and labor costs. Emirates success is the outcome of the combination of an unique geographic position and their differentiation strategy coupled with an excellent cost-structure. The company also takes advantage of owning also the Dubai International Airport (DXB) and to be in charge of the regional aviation policy. (OConnell, 2011; Lohmann et. al, 2009) In 2012 the airline carried 39 million passengers and numbers are even rising. (Emirates Annual Report, 2013). It is excepted that Emirates Airline will be the largest in the world. DXB is ranked the second busiest airport in the world in terms of international passengers. Following the opening of Concourse A in January 2013, the capacity has increased to 75 million passengers per year and will still rise. (Dubai Airports, 2013, online) According to the MENA Report (2012), Tim Clark, the president of Emirates Airline states that Dubai Airport will be the worlds biggest hub till year 2018 with a capacity to rise from 60 million to 90 million. Not only the size but also the non-aeronautical business, like duty free zones has been a focus of development. (Lohmann et. al, 2009) Due to the patriarchy, where only leader Al Maktoum has the power, Dubai is an extremely centralized country. Consequently, the Emirates group forms the umbrella brand for all aviation related businesses, whereas the airline is the core entity. For the tourism industry it means, that the government navigates all elements of the aviation and tourism value chains, such as destination and leisure management, IT services, distribution as well as cargo and handling. In order to attract travelers to stay in Dubai, Emirates markets the "Dubai Stopover Program", which includes accommodation, ca rental and tours for discounted prices. (Lohmann et. al, 2009)

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Both, Singapore and Dubai are centrally located , both hubs where transformed into tourist destinations by integrating the airline, airport with tourism planning and both positioned themselves as shopping paradises in order to attract more visitors. As Singapore and Dubai having a similar geographic position and targeting the same customer segment with similar routes, competition is increasing. (Lohmann et. al, 2009) Travelers today are more and more demanding, therefore destinations cannot afford resting on their achievements. By having the similar basis when it comes to competing in the tourism industry, it is in my opinion all about positioning and branding. I have the feeling that both destinations already overcame the image of a stopover destination and developed into major tourist attractions. Despite the fact that Singapore Airlines has always been the ambassador for the country, they have to take into account what will happen if Emirate Airlines gains and shifts tourism flows by air. The same challenge arises for Dubai. What happens if tourist will not be delighted anymore by getting overwhelmed by the biggest, tallest, widest, richest and so on? I see Singapore on the right track by adapting its tourism management plan every five years according to the market situation and demand. Firstly they plan to deliver better quality experience targeting customer needs. Therefore the managemnet concentrates on getting to know the visitor better and understand who they are and how they tick. In doing so, the tourism board also wants to customize marketing campaign according to different markets. In addition they create training programs for the whole service industry, willing to achieve a service standard "that goes beyond the smile". Secondly, Singapore tries to enforce closer collaborations within the entire tourism industry, in order to create forward-looking and sustainable partnerships. When it comes to positioning and branding, the management is aware of the importance of storytelling and wants to build on their cultural heritage. They already created cultural districts like China town, Kampong Glam or Clean & Green Garden City and even plan to develop new tourism zones for edutainment, nature themed and Lifestyle & Sports. In terms of market orientation they will concentrate on emerging markets India and China. Dubais current positioning as the city for a home of luxury brands, world class shopping, extraordinary architecture magnetizes tourists in a world of endless possibilities. It is known for the biggest, best, tallest, most impressive, the richest, the highest, the whatever. As a tourist in October 2013 I could experience on my own that this destination delights its customers by creating a WOW-effect when experiencing the extremes of Dubai. The

question that arises here is: Will the customer still be surprised in a couple of years by the biggest and tallest? Or does Dubai need to undertake a repositioning in the foreseeable future in order to stay attractive and competitive? What I got to know from Miss Asma Mohammad, (head of region East & West Europe Overseas Promotions and Inward Missions Dubai), during our visit at the DTCM in Oct. 2013, is that the destination actually concentrates on three main pillars, namely Families, the MICE segment and Events from now on. She also stressed the growing number of hotel rooms, counting 60.000 rooms in 2013 and reaching a number of 100.000 by 2020. Just recently it was decided that Dubai will host the 2020 World Expo. So, Dubai is still growing and following and adapting its current positioning but I could imagine that 2020 would be the year of rejuvenation or repositioning. In conclusion it can be said, that both locations Singapore and Dubai have established themselves as tourism destinations due to their competitive geographic location at the route between Asia, Africa, Southwest Pacific and Europe and the integration of the airline industry, the airport as well as the tourism industry. To succeed on the market though, places need to be more than just transfer hubs, they need to position themselves and concentrate on certain segments to target. In addition destinations always need to adapt their strategies and even may have to undertake a repositioning or rejuvenation strategy. Dubai and Singapore doing both well in magnetizing tourists and are both on the right track to keep or even strengthen their position.

References: Anning, C. (2012). Dubai vs Singapore - Economy. Available at: http://www.executivemagazine.com/special-report/669/dubai-vs-singapore-economy, Accessed: 29/11/2013 Changi Airport Singapore (2013). Facts & Statistics. Available at: http://www.changiairport.com/our-business/about-changi-airport/facts-statistics, Accessed: 20/11/2013 Dubai Airports (2013) Fact Sheets, Reports and Statistics. Available at: http://www.dubaiairport.com/en/media-centre/facts-figures/pages/factsheets-reportsstatistics.aspx?id=9, Accessed: 20/11/2013 Dubai Tourism (2013): Guest and Guest Nights 2003-20012. http://www.dubaitourism.ae/sites/default/files/hotelstat/20032012_Guests_Guest_Nights.pdf, Accessed the 20/11/2013 Available at:

Emirates Annual Report (2013): Annual Report 2012-13. Available at: http://content.emirates.com/downloads/ek/pdfs/report/annual_report_2013.pdf, Accessed 20/11/2013 Lohmann, G.; Albers, S.; Koch, B. & Pavlovich, K. (2009). From hub to tourist destination An explorative study of Singapore and Dubai's aviation-based transformation. Journal of Air Transport Management, 15 (1), pp. 205 - 211. MENA Report. (2012). United Arab Emirates: DUBAI airport expands to be biggest hub till 2018. London: Albawaba. OConnell, J. (2011). The rise of the Arabian Gulf carriers: An insight into the business model of Emirates Airline. Journal of Air Transport Management, 17 (6), pp. 339 - 346. Singapore Tourism Board (2013a). International Visitor Arrivals Statistics. Available at: https://app.stb.gov.sg/Data/tou/typea/type1/2012/16/VA_JanTODec12_15Oct13.pdf, Accessed: 20/11/2013 Singapore Tourism Board (2013b). Tourism Performance Report - Quarter One (Q1) 2013, Available at: https://app.stb.gov.sg/asp/new/new03a.asp?id=14043, Accessed: 29/11/2013