Paris, Milan, London, Miami, Tokyo, New York and Dubai.
The emirate has finally made it onto the most coveted list of all: The "who's who" of luxury brands and global fashion capitals.
There is no doubt that the development of leading luxury houses depends on brand longevity, with the choice of market destination a crucial one. And with more traditional markets such as Europe, the UK and the US facing increasing taxation, lease costs as well as serious competition and even saturation, it comes as no surprise that many luxury brands are now investing in building a commercial presence in emerging markets.
"Luxury houses, and in particular designer fashion brands, have been investing in their future by building commercial and brand presence in the emerging markets of Asia, Russia, and particularly the UAE," research analysts AC Nielson found in a recent report entitled Giorgio Armani and Gucci - considered as the world's most coveted fashion brands.
Today, the Middle East and in particular the UAE, represent an extremely promising market for a plethora of luxury labels, whatever their area of expertise. Be it watches or jewellery, cars or mobile technology, hotels or fashion brands, an increasing number of these iconic names are now here to stay in Dubai.
A Synovate Pax survey in late 2006 found that more than 70% of men and women in the UAE enjoy shopping as a pastime. And money does not seem to be an issue with 59,000 millionaires in the UAE alone in 2005. The UAE is experiencing a rising affluent customer base, whether nationals or expatriates, contributing to an ideal environment for luxury brands that are planning to expand their global footprint. When selecting a market retailers follow certain criteria points including market wealth, level of brand consciousness and awareness, and who is already there and how. But perhaps the most important factor that helped the world of luxury make a giant leap into the UAE was the commitment of local representatives and franchisees or existing retailers. Several groups have made huge progress in the field of establishing luxury brands in the UAE and they continue to provide the Emirates marketplace with access to some of the world's most coveted and respectable consumer brand names.
Chalhoub Group - a pioneer since 1955, Al Tayer Group, Sifico Fashion and Bin Hendi are some of the country's biggest names, not often known by the general public but that work hard behind the scenes for the luxury brands they promote. Each one can claim an astonishing repertoire of international labels, presented either in department stores or in stand-alone boutiques. Just stroll through the malls of Dubai or Abu Dhabi: Their stores are beside each other, just like on the Avenue Montaigne in Paris or Fifth Avenue in New York - both neighbours but also tough competitors.The real winners are the customers. With an increasing number of brands providing luxury shopping and service experiences, the latest exclusive products and stunning boutiques. But does this constitute excess, and does this still maintain the fundamental guiding principles of luxury? For centuries luxury was typically defined as ultra-indulgent services and products that combine creativity, high-quality materials, craftsmanship, rarity and a premium price. Much of their value had to do with their exclusivity. Luxury was about levels of quality and service that only the privileged few could afford. Even in the modern era, most of the well-known luxury brands such as Louis Vuitton, Rolls Royce, or Boucheron - were, a few decades ago, off-limits to everyone but the most affluent. This appears, however, to have rapidly changed. Janine Eccles, chief business development officer at the Chalhoub Group, argues that a luxury brand possesses a "magical appeal"."It is something that has a special quality to which a customer aspires and with which there is an affinity and a connection," she says. "A luxury brand is one that gives off an aura of rarity and distinction."Whatever luxury is becoming, it remains, without a doubt, a one-to-one dialogue between the brand and its customer.
Luxury brands across the world - and the UAE is no exception - have always been quick to react to the changing demands of their customers, and are very often the trendsetters guiding others on how to produce, market and sell consumer products and services. For luxury brands not only are their customers paying a premium for the product or service offered to them, they are also people accustomed to getting what they want. In many ways, personal pampering - in-store or by direct marketing - has become standard practice.This is extended not only to the most active purchasers, but also to all of the brand's customers - as how a client is treated is integral to selling high-end goods.Preferential treatment for customers tops the list of ways in which luxury brands distinguish themselves, yet the UAE has faced criticism over its levels of customer service. Often when shopping in certain high-end stores, customer assistants will not seem to know the finer details of the product, what the brand represents or what they could do to make your shopping experience more memorable. And this needs to change in order to meet the expectations of luxury brand customers. Multilingual, immaculate with impeccable manners, warm, knowledgeable and unobtrusive are the minimum prerequisites for any luxury salesperson. With so many stores, the hunt for well-qualified staff is well and truly on, and once again, in terms of service, luxury brands have the edge.
So, who are luxury customers? Emirati nationals are, without a doubt, the luxury consumers with the most disposable income, followed by expatriates from Western Europe and the US. "UAE nationals have acquired an unparalleled level of sophistication. A recent study showed that the usage of luxury products in the UAE is two to three times higher than the global average", says Eccles.
Tourists from the neighboring GCC countries and India, are also big luxury customers as they often find in Dubai or Abu Dhabi what is not yet available in Doha, Riyadh or Mumbai. There are also wealthy tourists from Europe or the Far East who are already used to buying luxury brands wherever they travel, alongside the latest herds of luxury-hungry Russian tourists. Source