New whitepaper by JLL spotlights industry trends and opportunities for growth
It is a fact that globally the rich are only getting richer and this is substantiated by the report on the global luxury goods segment which scored a market value of $262.66 Billion in 2021. It is expected to grow at a CAGR of 5.63 per cent during the forecast period of 2023-2028 according to researchandmarkets.com. Capgemini’s World Wealth report 2022, states that the high-net-worth individuals population expanded by 7.8 per cent, and global wealth expanded by 8 per cent in the year 2021.
The beauty of the Middle-East market is its customer who is well-aware, world travelled and understands the concept of luxury and in some ways has redefined it. The size of the UAE’s luxury market reached $3.5 billion in 2021, according to data released by ResearchandMarkets.com.
The Middle East and Africa luxury goods market is projected to record a compound annual growth rate (CAGR) of 8.5 per cent during the next five years and this is the reason why several big brands are opening their stores. The high purchasing power and sustained demand is the reason why in March 2022, Kering Group’s Gucci showcased its ultra luxe jewellery pieces for the first time at Palm Jumeirah.
Couturier Tarun Tahiliani, who is opening a store in Dubai soon, believes if there is a market for Rs1.3 million (Dh58,163) sneakers from Dior, and a lot of wealthy individuals who are the fifth or sixth generation affluent from all over the world are now preferring to settle in the Middle East, it is emerging as a potent force. “Many also come to Dubai to shop. Plus, it is a popular wedding destination too. Most importantly, the Arab world understands luxury like no one else,” he says. For the Dubai store, Tahiliani will offer abayas besides his high-end couture line as well as ready-to-wear. “The Middle East is also growing as an interesting tourist destination and the UAE has blended various cultures brilliantly, making life easy for its residents,” he adds.
The king of couture was the first to predict this growth and launched Sabyasachi Jewellery at Bayt Damas on August 3, 2021. The Dubai jewellery store has his most luxurious offerings, as the Kolkata-based style guru, admitted the customer understands and is ready to pay for superlative craftsmanship.
Manish Malhotra is also looking at opening this July for his buyers, who often visit his magnificent Delhi store in Mehrauli. “My designs reflect a vision of glamour and extravagance. For me, Dubai is the epitome of grandeur, which is why we are bringing the world of Manish Malhotra to this fascinating city. Dubai plays hub to world class luxury and it has taken the spotlight as a retail and luxury hub, from world-famous fashion mavens, to cars or real estate. The market in the UAE incorporates a slew of extremely aware and knowledgeable consumers, that are both willing and able to enjoy the luxury of luxury. Dubai enjoys the finesse and quality of refined products and understands their value, making it one of the most engaging markets for luxury fashion and our next stop, which I’m thrilled about,” says Malhotra.
Real estate too is growing in the Middle East. David and Victoria Beckham own a seven-bedroom villa in the Palm Jumeirah. Bollywood star Shahrukh Khan has a six-bedroom mansion there too, while Italian designer Giorgio Armani partnered with Emaar Properties in 2004 and launched his own hotel in Dubai. The Bachchan family, Abhishek, and Aishwarya Rai Bachchan, own a luxury house in Sanctuary Falls Jumeirah Golf Estates and Lindsay Lohan has a piece of The World Islands, located off the coast of Dubai.
But that is not all. Global couturier Rahul Mishra, who is now a veteran at the Paris Fashion Week, is opening his store in the Middle East soon. His product range will include couture womenswear, men’s bespoke festive wear, ready-to-wear (RTW) womenswear, RTW menswear, bags, accessories, and footwear. “The Middle East market comprises of a diverse customer base. It is a melting pot of cultures and aesthetic influences from across the world. The consumer has an elevated understanding of luxury and craftsmanship, and is willing to invest in clothing that is individualistic and independent of mainstream trends,” says Rahul, who is working on the interiors and design space.
He further adds that the region has the right mix of culture and technology, and it is where the past and future meet. There is a strong respect and consideration for traditional craft and values alongside the anticipation for rapid growth and development. “It becomes a perfect playing field for modern day luxury brands like us, that are traditionally rooted yet contemporary — brands that want to redefine the values of sustainable living and luxury through mindful fashion,” adds Mishra.
As exclusive brands are slowly understanding customers are now global, not local, their buyers are able to live multiple lives through fashion — experiencing various silhouettes with ease. “They understand personal style and fashion trends from a unique perspective, unlike any other consumer, as their sensibility is influenced strongly by both their heritage and the modern world. This allows them a special point of view in the debate of materialism and sustainable luxury. Hence luxury at times, may have a higher chance of being an emotional investment for them than being an impulsive purchase, which elevates the value and respect that’s seen in the garment,” he explains.
The quiet revolutionist, Anita Dongre, has a strong head for business. This has led to her brand’s exponential growth. Expanding to the Middle East has been a long-cherished dream of Anita’s, and she is thrilled to bring her brand to another luxury fashion capital of the world. “The store is an extension of the identity and philosophy of the brand with interiors designed to reflect my Rajasthani roots. It is a homage I would like to pay to the exquisite crafts and culture of India,” says Dongre.
Towering arches and ethereal chandeliers evoke the grandeur of royal palaces, while the furnishings and upholstery are designed with signature house-crafted fabrics. “Beautiful hand-painted panels by my Pichhwai artist in Rajasthan adorn the walls of our Dubai store. There is also our signature fragrance that all stores carry, which customers just recognise immediately,” she adds.
The store houses specially curated versatile, modern classics for the Emirati woman. With silhouettes ranging from beautiful co-ordinated sets and ready-to-wear dresses to classic evening gowns, kaftans, and handcrafted silver jewellery. “We also created a special line for Ramadan, dedicated to the Middle Eastern woman. Our new range of vegan accessories will also be available at the store,” she adds.
The ready-to-wear line is aimed at everybody as she views Dubai as a melting pot of various cultures. She has created a special line for the Middle Eastern woman which includes sweeping kaftans and glamorous evening wear. “Dubai’s dynamic culture, flourishing economy, and steady influx of visitors was a huge contributing factor to our international expansion plans in this buzzing luxury fashion market. Our focus is on taking time and patiently listening to and understanding our consumers in Dubai. We do have our sights on the UAE overall as a region to expand into. There are a lot of cultural similarities but also differences too. Every market has a different woman to create for, and that fuels my creativity. Dubai has been coming into its own as the next fashion capital and the Middle East is culturally quite close to us as a market,” she reiterates.
Many women from the Middle East shop at the Anita Dongre stores in Mumbai and the brand has been selling to them for quite a few years. “But coming here is going to be an exciting experience. There is a certain sensibility that is common between Indian and Middle Eastern women. The differences are nuanced and I think that is what makes it magical to create. It is very important to understand the Middle Eastern woman and what she wants, so I decided to create a special line for her. I’m really looking forward to being at the store and getting to know my customer better, and taking that line further,” she explains.
Dongre is one of the first South Asian designers to open a store in The Dubai Mall. A brand-new Anita Dongre website dedicated to UAE customers will soon be made available.
There is a rush of Indian designers who are opening in the Middle East and the man who has dressed a bevy of Bollywood beauties, Manish Malhotra, is set to open in the Dubai mall this July-August too. Global brand Gucci has 500 employees in the Middle East and Africa as well as 29 stores. According to a Business of Fashion report titled “Fashion in the Middle East—Optimism and Transformation”, “the region’s $89 billion fashion industry is set for unprecedented change in the upcoming years thanks to a mix of factors, from shifting consumer behaviours to new government investment policies.” It further states, the region’s fashion market is projected to record a CAGR of approximately 7 per cent between this year and 2027, according to Euromonitor International.
A BoF Insights survey in the UAE and Saudi Arabia found that as much as 50 per cent of high earners spend more than $1,000 on average a month on fashion. The Middle East is expected “to become one of the fastest growing markets for luxury in 2023”, according to Barclays Plc analysts. Owners of brands such as Louis Vuitton and Cartier will see huge returns as “the market will account for 8 per cent of luxury goods sales by 2030”. The expatriates, tourists and easy spending will be the factors which will contribute to this hike, according to a report in Bloomberg. Dubai’s GDP rose an annual 4.6 per cent during the first nine months of 2022 and had 13 million tourists till November last year.
There are many other factors which have contributed to this — the Qatar Grand Prix, the AFC Asian Cup and the 2022 Fifs World Cup. The Middle East and Africa combined have 17 countries and have some of the richest nations — Qatar and UAE. China which was a luxury hub has declined due to Covid and lockdowns, elevating the Middle East’s position as a go-to luxury shopping destination.
— The writer is a senior lifestyle and fashion journalist based in Delhi.
New whitepaper by JLL spotlights industry trends and opportunities for growth
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