DUBAI: Dubai remains the number one destination for luxury spending among Middle Eastern consumers, according to an American Express survey presented Tuesday at Arab Luxury World, a two-day forum in Dubai.
The survey, conducted by American Express Middle East and North Africa in partnership with international market research company GfK, collected data from more than 700 participants in six Arab countries in January and February 2017.
Participants from the UAE, Bahrain, Qatar, Kuwait, Oman and Lebanon were questioned about their spending habits and future financial plans.
According to the data, 21 percent of respondents said Dubai was their first choice as a luxury shopping destination, followed by Paris and London at 17 percent and 16 percent respectively. The next Middle Eastern country came in eighth, with four percent of respondents saying they would choose Beirut for luxury spending.
The presentation was given by Vice President of the Merchant Business at American Express Graziela Martins as part of a talk on spending trends in the Middle East.
The importance of Dubai as a spending hub was emphasized in an earlier presentation by Cyrille Fabre, partner at Bain & Company, who said that “Dubai is successful and gathering momentum to establish itself as a global hub… It’s already part of the top 15 luxury markets by city globally.”
Fabre praised the local arts and fashion scene, including such events as the Art Dubai fair, for creating the eco-system needed to nature Middle Eastern talent.
This eco-system, he said, contributes to the city’s allure as a destination for luxury spending.
Fabre did, however, warn that more has to be done to retain Gulf buyers, some of whom seek to spend on luxury items in Europe.
The retail market across the Gulf and Middle East has suffered due to oil price fluctuations over the past year, he said, but “although consumers have been negatively impacted by oil prices, we do have a high number of high net worth individuals in the region but we see that the number two nationality for some of the jewelry brands in Europe is the Saudis, after the Chinese, and purchases by people from the Gulf in London has increased quite significantly.
“So, our share of the wallet of our national consumers has dropped. Is it because they feel they have a better customer experience in London?”
Fabre’s advice for the audience of representatives from the premium goods industry was to “think like a millennial.”
The millennial “mindset is contagious. Other generations are also impacted and are changing their behaviors,” he said, adding that enhancing a customer’s experience in the digital world is crucial in order to encourage them to come to a store and buy.
“Seventy percent of all luxury purchases are influenced by one online touchpoint,” he said, quoting Bain & Company research.
“They want deeper engagement, they want a deeper experience both when they are buying and when online.
“People go on Instagram and see what’s trending, what their friends are liking and that’s how people like to engage so we need to integrate social media… I really believe the importance of Instagram here in the Middle East is much greater than anywhere else,” he said.
The fourth edition of Arab Luxury World, which ended Tuesday, was held under the theme “Digital Disruption and Emotional Engagement” and served as a platform for more than 70 speakers from the premium goods and services market to discuss and debate the latest trends in the industry.
Dubai the top spot for luxury spending by Mideast shoppers
Dubai the top spot for luxury spending by Mideast shoppers
