With its vast futuristic shopping malls resembling small cities more than just retail destinations, Dubai has become one of the fastest-growing retail centers in the world. The industry is forecast to grow from an estimated $34.2 billion in 2013 to $50.09 billion by 2016, an increase of 47 percent.
The meteoric rise of retail has been driven by the emirate’s growing population of expatriates as well as locals with high disposable incomes; its safe-haven status in the often-volatile Middle East and, most significantly, a sustained tourism boom. According to the Dubai Chamber of Commerce and Industry, 10 million tourists visited the city last year, an increase of more than 9 percent from the previous year, and in the last eight years, visitors to Dubai have doubled, driving more consumers through the emirate’s glittering malls.
In a survey last year, real estate consultancy CBRE ranked Dubai the world’s second-most-desirable growth destination for international brands, just after London.
“Dubai is typically the entry point for retailers looking to break into the region,” said Matt Green, head of research for the Middle East at CBRE. “It offers retailers a viable alternative to more mature markets, without some of the risk normally associated with an emerging market. It also offers significant growth potential and a consumer base that likes to spend.”
The government revealed plans to double the number of visitors to 20 million by 2020 and triple revenues generated from tourism. Sheikh Mohammed bin Rashid, ruler of Dubai, gave the green light for Mohammed bin Rashid City, a mammoth project that includes the world’s biggest shopping mall, called Mall of the World (Dubai already boasts the current largest mall in the world); more than 100 hotels; a Universal Studios franchise, and a public park larger than London’s Hyde Park.
For retailers, there is still a lot of opportunity. The Chalhoub Group has been partnering in the Middle East with luxury brands since 1955 in retail, distribution and marketing services, becoming a major player in fashion and beauty. Its portfolio of brands includes Christian Dior, Louis Vuitton, Christian Louboutin, Ralph Lauren and Lacoste. The company opened 37 stores last year in Dubai.
François Schweitzer, general manager of business development at Chalhoub, said the big luxury brands and high-street stores are already well represented, and “there is a strong potential for aspirational bridge brands. In the last few years, good growth has come from opening stand-alone stores in this category, such as Marc by Marc Jacobs and Michael Kors. Customers want much more than just a small selection of what they see in department stores.”
He said customers in Dubai are “very sophisticated and wanting the product now. We are in a phase where we need to attract a different category of brands and show that Dubai is a true fashion capital…[with] trendy things as well as luxury.”
Dubai’s unique geographic location and connectivity to different markets helps sustain the emirate’s position. Schweitzer noted, “With half the world’s population within seven hours’ flight time, there are a lot of potential customers to reach in Dubai.”
Population: 2.1 million Population change, past year: +5 percent Population change, past five years: +30 percent Projected population change, next eight years: +6.1 percent on average Per-capita income: $49,600 Disposable income: $26,000 Key industries: Mining and quarrying, tourism, retail, finance, construction Number of malls: 22 Mall developments: 3.8 million square feet of gross leasable area are currently under construction, spread over four malls, including one existing mall in expansion phase. Major construction projects: A new airport, Al Maktoum International, is slated to be the largest in the world upon expected completion in 2025. Mohammed bin Rashid City, a vast complex of 100 new hotels and the world’s largest shopping mall, will be developed over the next 10 years.
HOT SPOT: THE DUBAI MALL
There is no hotter destination for retailers than the world’s largest mall, The Dubai Mall, at more than 12 million square feet. In 2012 the mall’s visitor traffic reached 65 million, an increase of more than 20 percent from 2011. The world’s most visited mall attracted more visitors last year than New York (52 million) and Los Angeles (41 million).
More than just a shopping destination, The Dubai Mall is a year-round entertainment destination with leisure activities aimed at families including a Sega Republic indoor amusement park and an Olympic-size ice-skating rink. The visitor profile of the mall includes UAE residents, as well as 200 nationalities from all over the world. It is also home to the world’s largest shoe store, Level Shoe District, as well as a traditional gold souk.
With retail sales growing by 24 percent last year, the plush carpeted Fashion Avenue section of the mall, a 440,000- square-foot area dedicated to high fashion, is one of the most coveted spots in the complex, with long waiting lists for brands wanting to get in. Eager to capitalize on the demand, mall developer Emaar unveiled a 1 million-square-foot expansion program to the already gargantuan mall.
EXCLUSIVE: @tomford is opening its first-ever beauty store. The boutique, which opens November 20 in London’s Covent Gardens, was designed with the over-the-top glam Ford is known for. Read the full story on WWD.com, link in bio. #wwdbeauty #wwdnews (📷: Simon Wagner) #TomFordBeauty
New York-based DJ @harleyvnewton threw a party to celebrate the holiday collection of her dress and pajama line @hvn at the Ladurée Beverly Hills. It Girls @katebosworth, @rashidajones and more joined in on the fun, which included cocktails, croque monsieur sandwiches and a photo booth. #wwdfashion (📷: Owen Kolasinski/BFA.com)
For the holidays, @Burberry partnered with 20-year-old artist @blondeymccoy on a series of three outdoor murals in downtown Manhattan. The murals are McCoy’s interpretation of a Christmas eve party, the idea of charity and the spirit of family. His third mural, pictured here, is the most personal. The image depicts McCoy’s grandparents and father in London’s Trafalgar Square in the Seventies. “My work often features lots of sentimental objects.” #wwdeye
For spring 2018, designers applied bold colors and cartoonish motifs on everything from sneakers and belts to key chains. See all the top men’s accessories trends on WWD.com. #wwdtrends (📷: George Chinsee; Prop Styling by @rnasti; Market Editor: @luiscampuzano)
The @dior-sponsored @guggenheim international gala pre-party has a history of drawing cool-girl musical acts to serenade the crowd –– and last night was no exception. @haimtheband performed songs both new and old, and lured a star-studded audience with the likes of Rebecca Hall, Kate Mara, Mamoudou Athie and more. #wwdeye (📷: @lexieblacklock)
In a partnership between the @metopera and the @englishnationalopera, “Marnie” was born. The opera, with costumes sponsored by @mrporterlive, is an adaptation of the 1961 thriller by Winston Graham. Arianne Phillips, who created the costumes, is no rookie: She’s styled Madonna for her tours and created costumes for a myriad of films in the past. Read WWD’s interview with Phillips, where she talks about her inspiration for the opera’s costumes on WWD.com #wwdfashion
@barneysnyc took a different approach to their holiday windows this year. Instead of Christmas decor, Barneys tapped @thehaasbrothers to tell a story of positivity, gratitude and inclusivity via heartwarming silliness and humor. “It’s about kids and it’s about coming together and being family and loving each other,” said Simon Haas. #wwdfashion (📷: @joshuascottphoto)
Beauty influencer @kandeejohnson makes her foray into hair care with a collaboration with @ogx_beauty — making it the first time that OGX has teamed up for a product creation. The collab includes shampoos and conditioners in three scents. At 39 and a mom, Johnson is a different profile than the emerging social media stars, but is considered one of the pioneers of the digital beauty influencer world. Read WWD’s interview with her on wwd.com, including the strangest beauty product she’s ever tried #wwdbeauty