To receive the Vogue Business newsletter, sign up here.
The spending power of wealthy Arab consumers has long been appreciated by the major global luxury fashion brands. Now, these customers are becoming more exploratory in their shopping — a positive trend that is opening up new opportunities for niche and emerging brands.
The clichéd view that Arab shoppers prefer to play safe by buying leading luxury heritage labels no longer holds firm, say an increasing number of retailers in the Middle East. The region is a mature market, with brands such as Chanel, Dior, and Gucci present since the 1980s. Multi-storey flagships are implanted across Gulf capitals, with Dubai as the key location for superbrands.
However, many Arab shoppers are ready to look beyond the powerhouse brands of global luxury, according to industry insiders. Jacob Czarnota, CEO of Magda Butrym, a luxury Polish brand that entered the Gulf region two years ago, says: “It’s a region that has the spending power and taste for luxury goods. It is also undergoing social change [with] a shift in interest from core luxury heritage brands towards newness.”
The search for the new
This openness to newness is encouraging retail players in the Gulf to look beyond their well-established marquee luxury labels. Emerging independent labels are attracting interest from key retailers including That Concept Store, part of the giant Majid Al Futtaim (MAF) Lifestyle portfolio, and multi-brand Etoile La Boutique, part of the Etoile Group, which also represents luxury brands such as Etro, Chanel and Tod’s. Also in the mix is luxury e-commerce portal Ounass, owned by Al Tayer Insignia, a longtime key player in retail in the region for over three decades, and the exclusive licensee of Harvey Nichols in the UAE and of Bloomingdale’s in both the UAE and Kuwait.
Fahed Ghanim, CEO of MAF Lifestyle, is upbeat about the changing tastes of the Gulf consumer. “While superbrands retain their allure, customers now exude confidence in expressing individual tastes. The changing landscape signifies a more nuanced approach to fashion, maintaining an appreciation for established icons while embracing individualistic choices and subtle luxury.”
He notes new entrants to the list of bestselling womenswear brands, including Forte Forte and Erika Cavallini from Italy, and Monse and Area, both based in New York. The latter, founded in 2014, has emerged as a very hot name, with Ghanim citing a 385 per cent growth in like-for-like sales to date this year.
Change has been in the air in the brand mix at Etoile since 2022. Alongside Victoria Beckham, and Italy’s Etro and Stella Jean, Etoile has introduced Greece’s Celia Kritharioti and India’s Hemant & Nandita. As the luxury consumer becomes more exploratory, independent brands have the potential to play a pivotal role in the region’s fashion landscape.
Physical footprints in a digital world
The changes are being driven by younger customers, say retailers. “The Middle East has a young and increasingly diverse population. The younger generation is very globally connected through the internet and travel, exposing them to a wide variety of brands and products,” says Eda Kuloglu, chief merchandising officer at Ounass. Since the pandemic, the e-commerce platform has found a positive response to the UK’s Pangaia, and Skims and Kith from the US, brands previously unavailable in the Middle East.
One of the factors that helps the Ounass merchandising team decide on a brand is its digital imprint. Social media is an important shaper of luxury consumer preferences, especially among millennials. “Having a strong social media presence is important as the customer here is very savvy when it comes to social media,” says Kuloglu.
This trend has also encouraged greater experimentation among the region’s consumers. “Enhanced connectivity has introduced Middle Eastern consumers to a broader spectrum of fashion styles and brands worldwide, fuelling a desire for more diverse and distinctive fashion choices beyond conventional super brands,” says Ghanim of MAF Lifestyle.
While consumers may discover new brands on social media, physical stores play a very important role in allowing shoppers to explore them further. E-tailer Ounass is using physical pop-ups for new niche brands. “When introducing new brands into the region, it’s important to provide our customers with a physical experience to engage them and communicate the brand’s DNA,” explains Kuloglu of Ounass. “These experiences are original and exciting for the customer.”
The mix of online and physical retail has worked a treat for footwear brands such as Mach and Mach. Gvantsa Macharashvili, co-founder and co-creative director of the Tbilisi-based brand launched in 2012, says: “Although e-commerce is very important — and many [of our] business operations are carried out online — we still believe the in-store experience for the customer is irreplaceable.”
Learning about the Middle Eastern market
For brands looking to develop in the Middle East, the choice of the right local partner is fundamental, says Magda Butrym’s Czarnota. “It is always important to work with retail partners who are aligned with the brand identity as they play the role of ambassadors. This is especially crucial when a brand is entering a market for the first time.” He adds that preconceived notions about the Gulf market often turn out to be incorrect. “I feel there is often a misconception that Arabic women are only interested in modest fashion. Plus, the number of social engagements providing an opportunity to dress up in closed groups is very high.”
Ingie Chalhoub, founder and president of Etoile Group, says her customers seek “high-octane glamour”. The kind of brands that perform well at Etoile’s stores in Abu Dhabi, Riyadh and Doha include UK brand Jenny Packham, German brand Talbot Runhof and Greta Constantine from Canada. For a region that enjoys dressing up, brands with a couture touch or demi-couture details in their design vocabulary tend to attract shoppers, says celebrity stylist Cedric Haddad. “Arab women always value… the craftsmanship and hand embroidery.”
Exclusivity adds an important edge to making an impact in the region. Many of the brands that Ounass has worked with offer exclusive collections or create exclusive pieces made for the region. Italian brand Palm Angels, Australia’s Zimmerman and Bulgarian footwear label By Far are among those to have created capsule capsules for the e-tailer. On Etoile La Boutique, two London-based brands De La Vali and ILTA are exclusively available. “The Arab consumer values individuality and seeks out one-of-a-kind exclusive pieces,” says Chalhoub.
First-time brands launching in the Middle East should learn to appreciate the different tastes of consumers in each country in the region. “Do not think of the Middle East as a single market,” insists Magda Butrym’s Czarnota. “There are very strong differences between particular countries, much as there are between different states in the EU.”
For launch, however, most retailers and brands agree that Dubai is the best place to start. “The city is an ideal entry point for a brand because it’s diverse and lucrative,” Macharashvili of Mach and Mach says. Although, cities such as Doha and Riyadh are becoming more important year by year.” Luxury brands the world over will be taking careful note.
Comments, questions or feedback? Email us at feedback@voguebusiness.com.
More from this author:
Can India’s Circular Design Challenge go global?
India’s bridal shopping season is here. How can luxury brands tap in?