MidEast luxury goods market to see 15% growth

By Andy Sambidge

The Middle East's luxury goods market is set to grow by 15 percent this year, leading a global uptick in the sector, a new report has said.

Bain & Company's study said global luxury goods sales are defying initial concerns over Eurozone turmoil and fears of a cool down in emerging markets.

It predicted that the global market for top-end products would exceed €200bn in 2012 and that the Middle East luxury market would grow by 15 percent.

Cyrille Fabre, Bain & Company partner who leads the retail and consumer products practice for the Middle East, said: "The Middle East remains a crucial component in the sustained growth of the global luxury market.

"The region has opened exciting growth possibilities for key industry players and continues to be a major destination for a wide range of luxury brands.

"Bain's latest Luxury Goods Worldwide Market Study reaffirms the robust shape of the global luxury market and likewise underlines the huge growth potential of the Middle East region."

Bain also said it expects an average of 7-9 percent annual increases in global sales to fuel luxury brands' growth aspirations until the middle of the decade.

It added that a growth of online sales, rapid expansion in China, and shift from wholesale to direct-owned retail were key drivers of the growth in the sector.

Bain's study said that growth for Europe this year would range between 2-4 percent in Europe, the Americas would see growth of 5-7 percent while China's growth of 18-20 percent will rival that of India and Russia.

It added that new markets for luxury goods growth included Azerbaijan, Brazil, Indonesia, Kazakhstan, Malaysia, Mexico, South Africa, Turkey and Vietnam.

"Brands must develop strategies with much wider reach than ever before," said Claudia D'Arpizio, a Bain partner in Milan and lead author of the study.

"The lessons they learned in earlier emerging markets will help, but they now must manage even broader diversity of consumer preferences, and more variations in their model of how to take products to market."

Thirty percent of global luxury sales now occur within emerging markets, she added.

About www.mybeautifulafrica.co

This is a short description in the author block about the author. You edit it by entering text in the "Biographical Info" field in the user admin panel.