Regional Updates

For food and beverage brands, the pressure intensifies as delivery takes a larger share of the mix. While it supports topline, it reshapes margins through commissions (often 20–30%) alongside logistics and operational complexity.

The limits of promotional demand

Promotions are often the first response to softer demand, but they tend to shift demand rather than create it, compressing margins in the process. Stability comes less from discounting and more from strengthening existing customer relationships to generate repeat demand.

Re-centering the business around residents

As tourist flows weaken, residents become the most reliable source of revenue. This shifts the focus toward local routines, weekday patterns, family dynamics and neighbourhood life, where frequency can be rebuilt through relevant occasions and more agile execution.

Generating more value from existing customers

Some of the fastest gains sit within customers already connected to the business. Most organisations already hold sufficient data in their CRM or booking systems to act. Targeted initiatives — from exclusive previews to curated experiences — can drive incremental revenue and referrals without heavy investment.

Unlocking value across multi-brand portfolios

Many groups operate multiple brands serving similar audiences, yet manage them in isolation. Connecting these relationships creates two advantages: enabling customers to discover other concepts within the portfolio, and understanding which cross-brand behaviours drive the greatest value so they can be repeated.

Creating new occasions from changing routines

With both business and leisure travel softer, more social activity shifts closer to home. For operators in districts such as DIFC (Dubai), KAFD (Riyadh) or Msheireb (Doha), where surrounding populations are largely professional, relevance may depend on creating occasions that travel with the customer, extending beyond traditional venues.

Repositioning physical retail as a community destination

This shift is also structural. In Dubai, around 60–70% of recent retail supply has been concentrated in community and neighbourhood formats, reflecting a broader move toward local, repeat-driven demand. Physical locations increasingly need to function as neighbourhood destinations that encourage frequent return.

Periods like this reveal which organisations understand their customers most clearly. The capabilities built now to serve them better will continue to create value long after tourist flows return. The most resilient businesses are those built around strong relationships with the customers who live there.

For the full article: https://globaltrendmonitor.com/when-tourism-slows-gcc-retail-leans-on-resident-demand/

Author

Elisabetta Aiello

[email protected] 

https://elevionadvisory.com 

Elisabetta Aiello is Co-Founder of ELEVION and a senior brand customer strategist with more than twenty years of international leadership experience across global consumer, B2B and retail organisations.

Her career includes senior leadership roles with Starbucks at Alshaya Group, Metro AG and Ferrero, where she led large-scale customer, marketing and digital transformation programmes across multiple markets. She is based in Dubai.