Luxury Retail in UAE

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Luxury Retail in UAE

  1. 1. LUXURY RETAIL IN UAE CASE STUDY By: Anu and Sakshi 1/27/2014 1
  2. 2. LIST OF CONTENTS 1. Luxury retail in the world 2. Overview of UAE 3. Luxury retail in UAE 4. Value dimensions of luxury retail in UAE 5. Opportunities and challenges of luxury retail in UAE By: Anu and Sakshi 1/27/2014 2
  3. 3. LUXURY RETAIL - WORLD Top shopping destinations of the world (September 2013) 1. New York 2. Tokyo 3. London 4. Kuala Lumpur 5. Paris 6. Hong Kong 7. Buenos Aires 8. Vienna 9. Dubai, UAE 10. Madrid By: Anu and Sakshi 1/27/2014 3
  4. 4. LUXURY RETAIL - WORLD Opportunities to be tapped  Effective product differentiation  Continued high-quality standards  Careful distribution  Holding the price line  Tighter cuddling of the customer  Smart marketing  The mantra this year too – to treat the customer like family and, in return, get almost unconditional love By: Anu and Sakshi 1/27/2014 4
  5. 5. LUXURY RETAIL - WORLD Major challenges  Higher taxes in France and the United States  Slowing demand in China and Europe  Counterfeiting  Store overexpansion  Product overexposure  Over-reliance on Flash (social media) By: Anu and Sakshi 1/27/2014 5
  6. 6. UNITED ARAB EMIRATES  Geography By: Anu and Sakshi 1/27/2014 6
  7. 7. UAE OVERVIEW  Politics: Stable, safe and liberal  Economy: High standard of living because of oil wealth;     diversification has dampened the shocks of oil price fluctuations; the UAE is a regional trading and tourism hub International: Tension between the UAE and Iran over disputed Gulf islands; the US treats the UAE as an ally in its fight against militants Fourth largest Arab League economy United Arab Emirates Non--oil GDP growth is driven by transportation, finance, tourism, service and real estate sectors BCG report says that out of 1000 households, 40 households posses private wealth of at least $1 million By: Anu and Sakshi 1/27/2014 7
  8. 8. UAE OVERVIEW  Modern  Escalating urbanization  Offers luxurious lifestyle to expatriates  Surge in economic growth of 4.4% in inflation (2012)  Banking, tourism and trade expected to grow at 3% (2012-2015)     in which tourism tops the list Retail sector contribution to GDP of UAE is 14% and it will further grow by 7%(2011-2015) Data shows that UAE is well ahead of BRICS in luxury retail UAE luxury retail grew in revenue by $581 million Impressive economic growth, rising household consumption, By: Anu and Sakshi 1/27/2014 8
  9. 9. The UAE respondent’s views on the meaning of luxury Do not know/refused to answer 4% Others 7% Time to do exactly what you want 10% Something that appeals to your sense 11% Everything over and above what you you need 20% more about quality than price 22% luxury is a lifestyle 26% 0% 5% 10% 15% 20% 25% By: Anu and Sakshi 30% 1/27/2014 9
  10. 10. LUXURY RETAIL IN UAE  Aspirational behavior and preference for international luxury brands among expatriates, tourists and young locals are alike and is high  It is strongly increasing by various shopping carnivals and events as well as rapid development of modern retail infrastructure  Per capita consumption of cosmetics and fragrances in the UAE is one of the highest in the world  Luxury goods are priced high because of less competition and higher consumer base. This is not logical considering that UAE is tax free. This has to do with geopolitics, bilateral trade conventions and constraints set by national government By: Anu and Sakshi 1/27/2014 10
  11. 11. LUXURY RETAIL IN UAE  56% of expats receive a disposable income of over US $3,000 per month  Average household spending power in the UAE stands at $14,400 per annum, according to property consultant Colliers International  UAE consumers spend a lot on food and beverages By: Anu and Sakshi 1/27/2014 11
  12. 12. OPPORTUNITIES FOR LUXURY RETAIL IN UAE  Traditional affinity towards luxury and an increasing appetite of both      younger generation and mature consumers for top global brands The increasing ‘intra-region’ tourism and the emirate’s ability to attract foreign luxury consumers – mainly Russians, Indians and Africans The new Dubai Design District, which aims to cater to the needs of the fashion industry and is in line with the objectives of the Tourism Vision 2020. The middle class is disappearing and the rich are getting richer Chinese people are traveling to Dubai, and they are buying products of luxury brands Massive expansion of malls, new projects and infrastructure development By: Anu and Sakshi 1/27/2014 12
  13. 13. The Distribution of Gross Leasable Area, 2010 By: Anu and Sakshi 1/27/2014 13
  14. 14. CHALLENGES FOR LUXURY RETAIL IN UAE  Rising price of food, rent, education and transportation - middle rung are not going to buy branded stuff  Too many malls - increased competition  High retail rentals  To keep inflation under control  High level of employee turnover and joblessness among nationals  Counterfeit brands and difficulty to take legal action against them  Shoppers will expect easy-to-navigate ecommerce and mobile commerce offerings By: Anu and Sakshi 1/27/2014 14
  15. 15. Internet Growth and Population Statistics in UAE YEAR 2000 Users Population % Pop. Internet Growth735,000 and Population Statistics in UAE 3,750,054 19.6 % 2003 1,110,200 3,750,054 29.6 % 2005 1,300,000 3,750,054 34.7 % 2009 3,558,000 4,798,491 74.1 % 2010 3,777,900 4,975,593 75.9 % 2012 5,859,118 8,264,070 70.9 % websites for online shopping in UAE was souq.com, cobone.com, amazon.com, and markavip.com By: Anu and Sakshi 1/27/2014 15
  16. 16. KEY DIMENSIONAL VALUES  Functional and physical attribute- design, quality, recognition and reputation  Emotional - buying experience, flexible payment method, soft benefits, buying convenience, bargains with activities, promotions and prizes  Symbolic – related to travel, place, shopping center By: Anu and Sakshi 1/27/2014 16
  17. 17. ADDF By: Anu and Sakshi 1/27/2014 17
  18. 18. Wafi city spa JBR hotel Deira Gold Souq Raffles hotel By: Anu and Sakshi 1/27/2014 18
  19. 19. Bastakiya Madinat Jumeira Anantara Dubai Anantara Abu Dhabi By: Anu and Sakshi 1/27/2014 19
  20. 20. Danat Jebel Dhanna Resort Al Maha Aromatherapy and Rasoul treatment Dubai Marina Medical tourism By: Anu and Sakshi 1/27/2014 20
  21. 21. Dubai Mall, Burj Khalifa, The Address, Dancing Fountain Dubai Shopping Festival Dubai Summer Surprises Mall Of the Emirates By: Anu and Sakshi 1/27/2014 21
  22. 22. Dubai Outlet Mall Palm Dubai Mushrif Mall Abu Dhabi Dubai World By: Anu and Sakshi 1/27/2014 22
  23. 23. Cultural heritage of UAE By: Anu and Sakshi 1/27/2014 23
  24. 24. Cayan Tower Princess Tower JW Marriott Marquis Yas Viceroy AD By: Anu and Sakshi 1/27/2014 24
  25. 25. Kidzania Sega Republic Dubai Acquarium Dubai Ice Rink By: Anu and Sakshi 1/27/2014 25
  26. 26. Reel Cinemas Ibn Battuta Mall Miracle garden Burj Al Arab By: Anu and Sakshi 1/27/2014 26
  27. 27. Luxury villas Luxury cars Luxury apparel Luxury electronics By: Anu and Sakshi 1/27/2014 27
  28. 28. Luxury watches Luxury perfumes Luxury cosmetics By: Anu and Sakshi 1/27/2014 28
  29. 29. Key luxury distributors in UAE By: Anu and Sakshi 1/27/2014 29
  30. 30. Upcoming luxury projects in UAE By: Anu and Sakshi 1/27/2014 30

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