|Study Period:||2016 -2027|
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The Middle East and Africa luxury good market is projected to grow at a CAGR of 8.5% during the forecast period (2022-2027).
During the COVID-19 pandemic, the Luxury Goods saw a heavy decline in demand.As the luxury products market was mostly reliant on offline retail stores, with the onset of COVID-19, players realized the disadvantages of having only brick and mortar as their only sales channel. They started strategizing and diversifying their distribution channels. The majority of the players started developing their digital channels to reduce the buyer-seller gap. For instance, Richemont Group improved and developed its already existing digitized channel, which contributed 8% to the group's sales in Q1 2020 compared to 2% in Q1 2019.
In Middle East and Africa, especially in GCC countries 70% of consumers claims to have increased their spending over luxury good. 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.
The consumers in the countries such as Saudi Arabia prefer luxury goods over conventional ones, owing to their high purchasing power and sustainable demand for these products that reflect their social status. Such factors have led companies, such as MCM (Mode Creation Munich), to open their first boutique in Saudi Arabia to tap the market potential. The boutique offers a wide range of luxury leather goods and accessories, such as bags, purses, and wallets.
Scope of the Report
Middle East and Africa luxury goods market segmented by product type into apparel, footwear, bags, jewellery, watches and other accessories. The manufacturers operating in this segment are adopting various distribution network to incraese their consumer base, which majorly includes single branded stores, multibrand stores, online stores and other distribution channels. The market is thoroughly studied for different countries under the region such as United Arab Emrates, Saudi Arabia, Qatar, South Africa, and Rest of Middle East and Africa. The report offers market size and forecasts in value (USD million) for the above segments.
|By Product Type|
|Clothing and Apparel|
|By Distribution Channel|
|Single branded stores|
|United Arab Emirates|
|Rest of Middle East and Africa|
Key Market Trends
Increasing Demand For Luxury Leather Goods
The Saudi Arabia and Iran are huge producers of leather, with a large number of tanneries inside the countries. According to Leather Export Council, the United Arab Emirates ranks among the top five countries worldwide for luxury branded luggage. Luxury leather luggage holds major market share, when compared to other leather goods segment. The United Arab Emirates is one of the most attractive countries in the Middle East for luxury brands, and is a strategic center for companies deciding to enter the regional market. Therefore, competition among players is very strong for luxury leather goods market, intensified by the growth in online shopping. Moreover, the Middle East has one of the largest young populations in the world and millennial in the Middle East are richer than the average, and their willingness to buy luxury leather goods is stronger, which is expected to drive more sales of luxury leather goods in upcoming years. The footwear market in the region, on the other hand, is majorly driven by the increasing demand for luxury leather goods in the gulf countries. The United Arab Emirates and Saudi Arabia are the leading consumers of leather footwear in the region.
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United Arab Emirates Held a Significant Share in the Market
With more than 90% of the population residing in urban areas and the rising disposable income per capita, the preference for luxury products is high among the consumers in UAE. Abu dhabi and Dubai account for more than 50% of the over all population in the country. Dubai alone accounts for 30% of the Middle East’s luxury market. According to the study the UAE citizens spend around 30% of their monthly salaries on luxury goods. The UAE was recently eighth in a list of countries whose consumers are trading up from mid-market brands. Established international brands have more advantage, as foreign products account for 58% of all UAE purchases.
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The Middle East and Africa luxury goods market is a competitive market with the presence of various major players, such as Rolex SA,Giorgio Armani S.p.A,Dolce & Gabbana,Kering S.A. (GUCCI), Prada S.p.A., Burberry Group PLC,Guerlain,L’ORÉAL, Christian Dior SEand Chanel S.A. The key luxury goods players are embarking on mergers and acquisitions, and entering into partnerships /agreements as one of their key strategies to achieve consolidation and optimize their offerings. Major players are focusing on introducing new product offerings in the market to cater to the interests of the consumers as per ongoing fashion trend among goods, like footwear, accessories, and luggage bags. Since the leather products have significant role to play in luxury goods market, top companies are engaged in delivering quality leather product offerings for the fashion inspiring consumers.
In April 2021, Rolex added a new Day-Date, Datejust, Lade-Datejust, Cosmograph Daytona, and an Explorer to its Oyster Perpetual collection product range. Each product is unique and comes with its own set of design and usage metrics.
In April 2021, Prada SPA unveiled a capsule collection dedicated to Ramadan and Eid al-Fitr. "Reflections" is a unique collection comprised of ready-to-wear shoes and accessories from the brand's Spring/Summer '21 collection, as well as a few items created specifically for the occasion. The Ramadan edit was curated specially for the region, and to observe the occasion, pieces from the Reflections series were spearheaded by Afra Al Dhaheri and Fatima Al Ameemi. The campaign was filmed against an urban background in the middle of the desert, drawing inspiration from the collection's interplay of light and shadow.
In May 2020, CHANEL introduced a New Le Lion fragrance in the Middle-East seven months before launching in the global market. The product has a fragrance that is part of the Les Exclusifs range, with founder Gabrielle Chanel associating Lions as part of her birth date and being a source of luck.
Table of Contents
1.1 Study Assumptions and Market Definition
1.2 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET DYNAMICS
4.1 Market Drivers
4.2 Market Restraints
4.3 Porter's Five Forces Analysis
4.3.1 Threat of New Entrants
4.3.2 Bargaining Power of Buyers/Consumers
4.3.3 Bargaining Power of Suppliers
4.3.4 Threat of Substitute Products
4.3.5 Intensity of Competitive Rivalry
5. MARKET SEGMENTATION
5.1 By Product Type
5.1.1 Clothing and Apparel
5.1.6 Other Accessories
5.2 By Distribution Channel
5.2.1 Single branded stores
5.2.2 Multibranded stores
5.2.3 Online stores
5.3.1 Saudi Arabia
5.3.2 United Arab Emirates
5.3.4 South Africa
5.3.5 Rest of Middle East and Africa
6. COMPETITIVE LANDSCAPE
*List Not Exhaustive
6.1 Most Active Companies
6.2 Market Positioning
6.3 Company Profiles
6.3.1 Prada S.p.A.
6.3.2 Rolex SA
6.3.3 Burberry Group plc
6.3.4 Christian Dior SE
6.3.5 Chanel S.A
6.3.6 Kering S.A. (GUCCI)
6.3.7 Dolce & Gabbana
6.3.8 Giorgio Armani S.p.A
6.3.10 L'Oreal SA
7. MARKET OPPORTUNITIES AND FUTURE TRENDS
8. IMPACT OF COVID 19 ON THE MARKET
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Frequently Asked Questions
What is the study period of this market?
The Middle East and Africa Luxury Goods Market market is studied from 2016 - 2027.
What is the growth rate of Middle East and Africa Luxury Goods Market?
The Middle East and Africa Luxury Goods Market is growing at a CAGR of 8.5% over the next 5 years.
Who are the key players in Middle East and Africa Luxury Goods Market?
Prada S.p.A., Rolex SA, Burberry Group plc, Christian Dior SE, Chanel S.A are the major companies operating in Middle East and Africa Luxury Goods Market.