Gulf Tourism Is Having a Lost Year

0:00Music

0:10Sarah Dandashy: Gulf tourism is having a lost year and the numbers are stark. Meta just launched an AI agent that can actually book travel and Marriott's CEO says AI is about to change how you find hotels. It's Friday, September 11th. I'm Sarah Dandashy and this is the Skiff Daily Briefing. So first up, the Iran war has quietly devastated Gulf tourism, and a new SCIFT investigation lays out just how bad it's gotten. UAE hotel occupancy crashed to 36 % in March. That's nearly half of where it was a year earlier. But by July, it recovered to 60%. But that is still down 16 % year over year. Now, to fill those rooms, hotels slashed prices.

0:50Sarah Dandashy: The average daily rate in Dubai fell 50 % in April, A room that went typically for$1 ,700 a month last year is now going for$816. One hotel operator told Skiff that this simply is a lost year. His company absorbed$1.4 million in cancellations in three months. Marriott's Middle East RevPar fell 43 % in Q2. Of course, UAE RevPar was down 67%. And recovery isn't expected before late 2027. So if you're planning a trip to Dubai, rates are historically low right now. That part at least works in your favor. Next up, Meta just launched an AI assistant called Muse that can book travel. Skiff tested it, and here's what actually happens.

1:31Sarah Dandashy: For flights, Muse connects to live airline inventory through a company called Duffel. Real fares, bookable in the chat. But for hotels, it just opens a browser and chops the web pretty much the way you would. Checking Expedia and Hotels.com, for example. Comparing prices. Filtering by reviews. and it kept searching until it found something within budget. But the catch for travel companies, they have no say in where Muse shops or how many searches it runs. It just walks in and starts looking. At Metascale, that's 3.6 billion daily users. That's a lot of uncontrolled search traffic. And finally, Marriott's CEO said this week that AI's biggest impact on hotels won't be chatbots, but it'll be distribution.

2:14Sarah Dandashy: How travelers find hotels in the first place. Marriott is feeding Google and OpenAI as much content about its properties as possible to show up in AI search results. Even its own AI search inside the Bonvoy app is already converting at higher rates than traditional search. The takeaway? The hotels that show up in AI recommendations will win. The ones that don't will lose bookings that they never even knew were on the table. Well, that's it for your Skiff Daily Briefing. For more industry news, head to skiff.com and as always, subscribe at skiff.com backslash daily. Thank you.