By Atique Naqvi
The inaugural Arab luxury world conference – taking place until June 3 at The Westin Dubai Mina Seyahi – began this morning with an upbeat mood about the Middle East region’s premium sector in general, however some concerns about new economic realities – the opening up of the Iranian market and the stabilization of Indian economy owing to its new government – were raised.
Dubai, being the trading hub of the region, needs to adapt and accommodate the demand created by markets, such as Iran and India, while also taking care of the expansion of the luxury sector into Saudi Arabia, Kuwait and the UAE, according to the panelists of two opening plenary sessions.
According to Nadine Touma, head of business intelligence at Chalhoub Group, the regional luxury market is valued at $8.9 billion and is estimated to be increasing at approximately ten per cent annually. “Shopping is almost a hobby in the region and impulse shopping is quite big,” says Touma. With high spending power, shopping habits of GCC residents bode well for the luxury sector.
Touching on the heritage aspect in the premium goods sector, president and CEO of LVMH Fragrance, Alain Lorenzo, says clients of high-end products value heritage, culture and history of a brand. And this holds true for fragrances in the region, because GCC residents continue to support oud-based perfumes. “Approximately 50 per cent of the Arab fragrance market is oriental or oud based,” says Lorenzo.
Panelists also underline the importance of Expo 2020 and its meaning to the luxury sector. Dubai, which represents nearly 30 per cent of the Middle East region’s luxury market, benefits from the influx of high-net-worth tourists from Russia, India, China and Iran. Key retail locations, such as The Dubai Mall, have seen footfalls increasing significantly in the past few years and a major contribution comes from tourist shoppers.
In the run-up to Expo 2020, Dubai-bound tourism is set to accelerate and will further boost the fortunes of all stakeholders of the regional luxury sector.
Monday, June 2- 2014 @ 13:53 UAE local time (GMT+4) Replication or redistribution in whole or in part is expressly prohibited without the prior written consent of Mediaquest FZ LLC.