The opulent landscape of the Middle East’s luxury market has surged to an impressive value of approximately $16.5 billion, and its trajectory suggests an anticipated doubling in size by the year 2030, potentially reaching a staggering $38.5 billion. These estimations, underscored by a comprehensive survey jointly conducted by Boston Consulting Group (BCG) and Altagamma, the distinguished association representing Italy’s premier luxury brands, emphasise the influential roles of the United Arab Emirates (UAE) and notably, Saudi Arabia.
Matteo Lunelli, Chairman of Altagamma, offered insights into the evolving consumer dynamics propelling this surge, stating, “The high-end consumer has a double figures increasing propensity to spend. The number of points of sale is stable but with a significant increase in size and with the creation of unique experiences that are increasingly personalised and exclusive.”
Lunelli also highlighted the metamorphosis occurring within the luxury realm, encompassing shifting consumer behaviours, evolving values, and the proliferation of omni-channel distribution strategies. These adaptations are interwoven with emergent collaborative and consolidation strategies spanning both the upstream and downstream sectors of the supply chain.
The luxury market’s surge in the Middle East is notably driven by the UAE and Saudi Arabia, spearheading regional growth. In Saudi Arabia, the current market valuation hovers around $3.3 billion, with projections foreseeing a doubling in magnitude, surging to approximately $6.5 billion by 2030. The fertile ground for luxury goods in the region is attributed to multifaceted factors, including localised advancements propelled by Vision 2030 initiatives, heightened domestic demand, and an upsurge in high-end tourism.
Furthermore, the Middle Eastern nations, particularly the UAE, have emerged as a sanctuary for affluent Russian individuals who have sought locales to channel their wealth due to the ramifications of sanctions imposed by the US and EU. The Gulf countries have remained immune to enacting sanctions against Russia or its citizens, thereby becoming attractive investment and spending hubs for these affluent individuals.
China, too, stands on the precipice of remarkable growth in the luxury goods domain, courtesy of rising incomes and escalating interest. This trajectory is particularly pronounced in countries with a burgeoning count of high net worth individuals, possessing personal assets that exceed the $1 million threshold. As the global luxury landscape continues to reshape, the Middle East and China are poised to etch remarkable narratives of expansion within this illustrious sector.