LONDON — Panama, Ghana and the Dominican Republic could well be the luxury hubs of the future, according to a report to be published later this week by Ledbury Research.
This story first appeared in the April 23, 2013 issue of WWD. Subscribe Today.
The consultancy’s twice-yearly “HotSpot” report examines new markets around the world and measures their potential appetite for luxury goods based on factors including business air travel, luxury retail, economic and wealth growth.
Jordan stands in the top spot in the latest ranking, thanks to a new Louis Vuitton store that opened in Amman in July, and also to the capital’s Cartier, Bulgari, Tiffany & Co. and Burberry stand-alone stores. Ledbury points out that Jordan’s economy has grown at an average rate of 4.3 percent a year since 2005, and the 2011 gross domestic product per capita is $6,000. Unemployment is high, however, as is public debt, while instability in the region remains a risk.
Panama, Ghana, the Dominican Republic and Saudi Arabia were all in the top five, while China ranked just above Qatar at 19. Nicola Ko, a luxury analyst who worked on the report, said that in the space of six months — since Ledbury published its last report — “We’ve seen a move away from Asia. We ran the same HotSpot [research] model, and we’ve seen a big shift toward Africa and the Middle East,” as well as South America, she said.
In its report, Ledbury also takes a look at all facets of the luxury business, noting that oil-rich Nigeria, which ranks ninth on the list, is among the fastest-growing private jet markets in the world, with wealthy locals spending $6.5 billion in the last five years on private planes. Private jet ownership in the country has grown from 20 jets in 2007 to more than 150 in 2012.
Ko said the research turned up some surprises. While the report is focused on emerging markets for luxury, one very developed market — France — is set to register much activity over the next 12 months. Tiffany & Co., Piaget, Jaeger-LeCoultre and Shang Xia, the boutique Chinese label that belongs to Hermès, are all set to open stores in the country next year. “A lot of sales in Europe are made to tourists, so I think that’s one reason. Another is heritage — in the case of Hermès, they probably want something closer to home,” said Ko.