The state of luxury is in flux. The concept that a luxury good is a status symbol is rapidly being replaced by that of experiences. With economic headwinds impacting the global economy, we delve into how the GCC’s luxury market is coping, and why its future remains a positive one.
Overall, growth in the luxury goods industry will continue, as will those in other luxury segments (including cars and experiences). And while there remains apprehensive caution in the world of high end luxury, the market continues to grow. According to Bain & Company, the overall global luxury market grew by 5 per cent last year – now valued at Dhs4.96 trillion. Luxury cars, luxury hospitality and personal luxury goods together count for more than 80 per cent of that. While luxury products took a slight dive in 2018, the market was bolstered by cars (which grew at a steady 5 per cent from last year), gourmet food and fine dining (up 6 per cent) and luxury cruises (up 7 per cent).
Personal luxury goods are driving growth
The Middle East was not far off international standards of growth for personal luxury goods. The global market hit a high of Dhs1.01 trillion (a healthy 6 per cent growth year on year). Overall, it was shoes and jewelry that topped luxury growth categories – gaining 7 per cent each – followed by handbags and beauty. Watches remained flat, while apparel suffered.
In the Middle East, the slightly slower growth of around 3 percent was caused in part by geopolitical tensions and varying oil prices. That said, tourism has been a huge source of strong economic growth in the region, and Dubai remains one of the world’s top luxury destinations for Middle Eastern consumers, as well as for Chinese and European visitors.
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Denne historien er fra May 2019-utgaven av Gulf Business.
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