Middle East Luxury Goods Market Outlook 2024: Opportunity & Growth Analysis, 2016-2024

Middle East Luxury Goods Market Outlook

Middle East Luxury Goods Market Outlook 2024: Opportunity & Growth Analysis, 2016-2024 Sample Request

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Middle East Luxury Goods Market Size (USD Billion) & Growth Analysis Middle East Luxury Goods Market Size (USD Billion)-2016-2024

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XX

XX XX

XX

XX 2016e

2017e

Source: Goldstein Research

XX

m a S

XX

2018f

2019f

2020f

e l p

XX

2021f

XX

2022f

XX

2023f

XX

2024f

Middle East Luxury Goods Market

is anticipated to expand at a compound annual growth rate of XX% during the forecast period i.e. 2016-2024. Furthermore, international brands expanding to Dubai will benefit greatly from the consumers preference of luxury buying as the local population considers shopping as an important social and entertainment destination, and leisure activity that are often practiced with friends (XX%), or sisters and mothers (XX%). Moreover the shopping mall culture in the Middle East is vast, as consumers need somewhere to spend their days during the hot, humid climates seven months out of the year. Because of the generally hot climates, shopping culture will remain prominent in the Middle East as the consumers share a common interest in shopping and spend most of their weekends inside in the air conditioned malls. Luxury brand loyalties will essentially be high as “there are a growing number of young educated consumers with a high disposable income. For instance, in the UAE there was a high consumption of luxury goods by consumers with a high per capita income of USD 45,000 on average in 2016.

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Middle East Luxury Goods Market Outlook  The Middle East showcase solid growth rate globally, overall luxury goods industry growth is promising related to historic period. Middle East premium consumers are among the leading spenders on luxury goods, the tenth highest spenders in the world. According to Goldstein Research analysts, the demand for luxury and top-ofthe -line products remains robust in the Gulf Cooperation Council (GCC) region despite the economic slowdown.

Growing Ecommerce Business

 In Middle East, Especially in GCC countries XX% of consumers claims to have increased their spending over luxury goods compared to XX% in more mature markets such as Europe, Japan and United States. In past few years Middle East luxury goods industry has been through a period of expansion, as major companies have grown by extending their reach of their brand distribution network and opening new stores in the region.

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 The luxury goods market in the Middle East provides immense opportunity for luxury brands: luxury goods markets in Abu Dhabi and Dubai have helped to promote these cities as desirable shopping destinations to shop for luxury brands. Well recognized big-name brands have achieved well in the region, and tourism is a major driver of sales of luxury accessories or Goods in Dubai.

m a S

 In 2016, the value of women’s high-end watch sales in the region increased by XX percent year over year; in 2015, the rise was XX percent and the majority of sales are made in United Arab Emirates. In comparison, the value of women’s luxury timepiece sales globally grew only XX percent last year.

 “The ladies like Goods with diamonds and bling,” and “Men tend to go for white gold, platinum or steel. The watch has to be very discreet, and often men try to match their watch to a pen and sometimes cuff links.” Middle East watch customers are big fans of ultra-exclusive timepieces such as limited editions and bespoke Goods. It is true that they tend to like larger models, high complications and audacious designs.

Growing Tourism Industry

High Disposable Income

Growth of Luxury Shopping Centers and Malls

Middle East Luxury Goods Market (USD Billion) Saudi Arabia

2016

USD XX Billion

2024

USD XX Billion

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UAE

Rest of Middle East

USD XX Billion

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Middle East Luxury Goods Market Outlook Middle East Luxury Goods Market Share(%), By Region-2016-2024

Middle East Luxury Goods Market Size USD (Billion). 2016-2024 XX XX

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XX% CAGR: (2016-2024)

XX

30.00 9.00 2024 % %9.00 % 8.00 25.00 % % 12.00%

30.0 9.00 2016 0% 9.00 % %8.0025.0 % 0% 12.00%

XX

7.00%

XX

XX XX XX

UAE

2016e 2017e 2018f

Source: Goldstein Research

2019f

2021f

2022f

2023f

2024f

Oman

Kuwait

Qatar

Bahrain

Rest of UAE

Source: Goldstein Research

Luxury Accessories accounted for the highest market share XX% in Middle East

In 2016,

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Saudi Arabia

m a S 2020f

7.00%

luxury goods market

With

XX% share in 2016, UAE dominated the Middle East Luxury Goods market

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Growth Drivers E-Commerce Turnover Per of the Global Regions2015-2016

Booming E-Commerce Industry 

Despite strong fundamentals, the GCC is one f the world’s most challenging e-commerce playgrounds. With some of the world’s highest level of GDP per capita, the region is home to many people with large disposable incomes. Average mobile penetration stands at more than XX percent, and smartphones is at more than XX percent. In addition, more than two-thirds of the population uses the internet, with penetration in UA and Qatar exceeding XX% Our study reveals that only XX percent of major GCC retailers have and e-commerce channel, compared with XX percent in the United States. However, with the right enablers in place, we believe the GCC e-commerce market could almost quadruple to reach USD XX billion by 2020.



For GCC retailers, the success of Omni channel strategies will depend mainly on their ability to develop a string online presence, provide robust payment mechanisms and invest in distribution and infrastructure. In addition, they will need to collaborate with regional governments to resolve the bottlenecks in policies that will remain crucial to the ongoing success of cross-border e-commerce ecosystem

Region

2015

2016

Growth

World

USD XX bn

+19.9%

Asia Pacific

USD XX bn

+28.4%

North America

USD XX bn

+12.5%

Europe

USD XX bn

+13.3%

Latin America

USD XX bn

+28.0%

MENA

USD XX bn

+18.6%

Source: Goldstein Research

Online Watch Sales (USD Billion), by GCC Countries- 2016 Impact Analysis:-

10.00%

Express Carriers

10.00% 40.00%

Combination Carriers

All Cargo

Passenger Belly Only

 Continuing growth of online-driven business-to-business (B2B) and businessto-consumer (B2C) sales demand has magnified the criticality of meeting customer expectations. Shippers will directly improve win probability by reformulating e-commerce transportation strategy and executing operational practices that enable delivery speed and certainty – along with dependable and flexible service – to yield a better customer experience.

40.00%

Source: Goldstein Research

High

Medium

Low

Impact on Middle East Luxury Goods Market Copyright

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Market Restraints Sample Request

Brand Awareness and Consumer Preferences

 Ultimately, luxury brands, like most consumer facing brands, need to deliver an engaging, exciting and efficient shopping experience to all their customers regardless of channel. Social media allows the opportunity to issue short but frequent messages, which works really well for luxury brands as their products and image are inherently aesthetic - so their message carries well in this format. For example, the visual nature of Instagram, the social photo and video-sharing app, makes it a natural platform for luxury and fashion brands. In addition, the space constraints force the brands to be more conversational and approachable, which is an excellent way to engage fans and to reduce the perception of coldness, sometimes associated with luxury brands.  Luxury brands do not necessarily have to be small to be considered exclusive. Brand DNA is best maintained if the brand keeps control over the entire business, from the product design and sourcing of raw ingredients to distribution and marketing. Having complete control of where and how a product is sold is essential. Many brands are shifting towards opening more directly operated stores because that allows them to control how the product is displayed and presented to the final consumer, ensuring that all aspects of the brand DNA are properly transmitted. However, the idea that small is beautiful has not been lost on the luxury conglomerates - big luxury groGiorgio Armani SPA are looking to invest in early stage brands with growth potential.

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Consumer Preferences (%) To Shop For Luxury Goods, By Different Demographics XX% XX% XX% XX% XX% XX% XX% XX% XX% XX% XX%

m a S XX%

XX%

Millenials (18-33)

Generation X (34-49)

Impact Analysis: Cargo life cycle assessment is necessary in order to comply with the norms and regulations. Thus, the assessment involves use of time and money and disrupting the manufacturing processes and eventually the supply of materials.

XX%

Online

XX%

Baby Boomers (50-68)

Impact on Middle East Luxury Goods Market High

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In Physical Stores

Medium

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Low

Middle East Luxury Goods Market Outlook : 2016-2024 Middle East Luxury Goods Market Share (%), By Distribution Channels, 2016-2024

15.00% XX%

Online

2024

2016

Sample Request In 2017, e-tail accounted for XX% of middle east luxury goods consumption, and it is forecast to carve out a XX% share of the market in 2025. Faced with this e-tail acceleration, luxury labels are absolutely forced to adapt their strategies.

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The luxury industry has accepted the idea that digital distribution is a priority, since it is one of its most Offline XX% 85.00% significant growth vectors. Proof of this are the growing presence of luxury brands on the web in China, one of the key markets for the luxury goods industry today, and Source: Goldstein Research Middle East Luxury Goods Market Y-O-Y Growth, By Transportation, the increase in online sales of highend products in the USA.

2016-2024

XX%

2016e

2017e

2018f

m a S XX%

2019f

XX%

2020f

2021f

2022f

2023f

This kind of expansion has several strategic implications. The first, predictable one is the shrinking of brick-and-mortar store networks, starting with monobrand stores but especially affecting wholesale clients. According to analysts, this kind of 'rationalisation' is essential in order to preserve the perceived exclusivity of brands and their longterm value.

XX%

2024f

Source: Goldstein Research

Middle East Luxury Goods Market Size (USD Billion), By Transportation Mode-2016-2024 XX

XX

2016

2024 Online

Offline

Source: Goldstein Research

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Middle East Luxury Goods Market Outlook By Online Distribution Channels: 2016-2024 Sample Request

Middle East Luxury Goods Market Size (USD Billion), By Online Distribution Channels, 2016-2024 XX XX XX XX

XX

XX XX XX 2016e

2017e

m a S

2018f

2019f

2020f

2021f

2022f

2023f

Source: Goldstein Research

"The web acts as a magnifying glass, exposing the shortcomings of brands with regards to their commercial policies, and their lack of control on their own distribution. This adds extra pressure to labels which are more dependent on the wholesale channel,“

e l p

2024f

"The most likely scenario is that, in the next five years, luxury e-tail will become extremely crowded. Luxury brands will have largely developed their own e-tail capabilities. With the entry of global brands,

Middle East Luxury Goods Market Y-O-Y Growth, By Online the GCC became a sizeable and one Distribution Channels, 2016-2024 of the main growth markets

XX%

2016e

2017e

2018f

XX%

2019f

XX%

2020f

2021f

2022f

2023f

Source: Goldstein Research

XX%

2024f

globally. For the retailers, particularly in the luxury and premium segments, the period between 2004 and 2014 were their golden years. In the UAE alone, luxury goods market size has grown from USD XX billion in 2004 to USD XX billion during the decade, of which luxury Goods comprises significant share and more than XX % of the total sales took place in physical stores.

Consumer Preferences To Shop For Goods Within Different Channels, By Different Demographics XX% XX% XX% XX%

XX%

In Physical Stores

XX% XX%

Online

XX% XX%

XX%

Millenials (18-33)

Generation X (34-49)

Baby Boomers (50-68)

XX% XX%

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GCC Luxury Goods Market Attractiveness-By Country, 2016-2024 GCC Luxury Goods Market Attractiveness-By Country, 2016-2024

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7 6 5

CAGR (%)

4 3 2 1 0 0.5

UAE

1

1.5

2

Saudi Arabia

Kuwait

2.5

3

3.5

4.5

5

5.5

e l p

Market Size (USD Billion) Qatar

Source: Goldstein Research

4

Bahrain

Oman

Luxury goods in the United Arab Emirates continued to witness slow growth due to the challenge of adjusting to local and global economic pressures starting in the year 2016. The luxury goods industry was reportedly one of the worst hit markets as shaken consumer confidence led to decreased demand, for which the supply needed to be adjusted.

m a S

The United Arab Emirates is one of the most attractive markets in the Middle East region and is considered as the key long-term entry market for companies. Although the rate at which brands enter the luxury goods market or expand their stores in the region has slowed down, intense competition remains within the tight market and amongst existing players.

North America GCC Luxury Goods Market BPS Analysis- By Country, 2016-2024 XX% XX% XX% XX%

XX% XX%

Bahrain

XX%

Oman

XX%

Kuwait

XX%

XX% XX%

28%

XX%

Qatar 26%

XX%

UAE

XX% XX%

30%

28%

2016

2024

XX%

Source: Goldstein Research

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Saudi Arbia

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