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Luxury continues growth path in Middle East with 12 percent increase

In an interview to MFF, Patrick Chalhoub, co-CEO of Chalhoub Group, one of the regional luxury retailers present in 14 countries, highlighted the specifics of the Middle Eastern luxury market:  sales of fashion represents between 35 to 40% of the entire market (compared to 50%, at a global level), of which accessories represent 45% (compared to 30% at globally): 15% shoes (against 10%). Luxury watches and high jewellery represent account for 30 to 35% of the market, compared to 20% at an international level. 

Chalhoub Group has over 500 sales points and operates strategic joint-ventures with major international luxury brands such Louis Vuitton, Dior, Berluti, Louboutin e Sephora. In recent years, Chalhoub Group has been diversifying its business by operating both in franchising and through joint ventures brands such as: Saks Fifth Avenue, Loewe, Carolina Herrera, Ralph Lauren, Swarovski, Lacoste, Michael Kors etc. 

For a more targetted approach, Chalhoub have been developing their own retail concepts such as Tanagra, specialized in lifestyle and entertainment; Faces, a chain of 70 beauty stores,  Katakeet, a retail chain specialized in childrenswear, and most recently, Level Shoe District, a 35.000 sqm space within Dubai Mall, entirely dedicated to shoes with 40 designers, shop in shops as well as bespoke and VIP services.

Patrick Chalhoub also pointed out the crucial importance of understanding luxury consumers which present significant differences from city to city within the same country, not only from country to country, for instance:  locals in Abu Dhabi are more elitistic, Kuwaitis are more withdrawn while those in Riyad are more conservative.

In terms of sales of luxury by product categories in the Middle East, Chalhoub quoted: fashion with 1,6 billion euros and beauty with 1,1 billion euros( 65% fragrances, 27% make up, 10% skincare (10%).

Level Shoe District at Dubai Mall

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