Quotes: US MENA   Enter Symbol: NewsLetter: Search: advanced

Middle East leads 2013 luxury shopping with EUR 1,400 per capita spending, says BainCompany  Join our daily free Newsletter

MENAFN Press - 05/03/2014
No. of Ratings : 0
Add to Mixx!



(MENAFN Press) The number of luxury consumers worldwide has more than tripled over the past 20 years, from roughly 90 million in 1995 to 330 million at the end of 2013. The statistics come from Bain & Company, the leading advisor to the worldwide luxury goods industry, in an extensive study of 10,000 luxury consumers conducted in collaboration with Redburn Partners, Europe's largest independent equities broker, and Millward Brown, a leading consumer research agency. Their report, 'Lens on the Worldwide Luxury Consumer,' was released recently in Milan, Italy.



According to the report, a net total of 10 million additional consumers enter the luxury market yearly. The number of luxury consumers is expected to reach an estimated 400 million worldwide by 2020 and 500 million by 2030. In its analysis of approximately 10,000 luxury consumers, the report finds significant differences within the global luxury market and its consumer base, which is shifting from a historically-homogenous base of affluent consumers worldwide to a broader and highly heterogeneous class of luxury shoppers.



"The race is on to capture an explosion in worldwide luxury consumer growth," said Claudia D'Arpizio, Bain partner in Milan and lead author of the report. "But the luxury consumer of the future will become increasingly heterogeneous and luxury brands and operators need an immediate upgrade to their consumer strategies in response to this growing diversity, or else risk falling behind.



"Middle East consumers have the highest per capita spending on luxury goods, at about EUR 1,400 per year. The vibrancy of this market, however, has given light to a more cautious spending consumer, who shows high preference for well-known brands and logos. Their key luxury categories include leather goods, watches, cars and overseas holidays-with Dubai remaining the biggest market in the region with almost 30 per cent of the total market share," said Cyrille Fabre, Bain & Company partner who leads the Retail & Consumer Products practice for the Middle East



Within the luxury segment's current 330 million consumer base, 55 per cent (180 million) shift between luxury and merely 'premium' purchases, including products such as designer 2nd lines, beauty products, and small accessories. This group comprises approximately 10 per cent of global spending, purchasing an average of EUR 150 per capita annually. The remaining 45 per cent (150 million) represent 'true luxury consumers' who consistently dedicate part of their discretionary spending to personal luxury products of various nature, usage occasions and price point and make up roughly 90 per cent of global spending, purchasing an average of EUR 1,250 per capita annually. Additionally, the top 10 per cent (15 million) within this group capture over half of its spending.



Key to the report is its focus on the shift in the heterogeneous global picture for the new luxury consumer and what Bain defines as the '7 New Faces of the Global Luxury Consumer,' a comprehensive profiling of seven luxury consumer segments displaying a divergence of tastes and buying behaviors, while straddling national and generational boundaries:



1.The Omnivore (25 per cent of spending, at an average EUR 2,350 per year): These shoppers are typically new entrants to luxury. On average, they are younger than the other clusters and have a high willingness to experiment with products and brands. They are primarily women and tend to purchase high ticket items, focusing on the jewelry and watches categories. They prefer to shop in a brands' own stores and many of their purchases are made while travelling. They prefer aspirational brands, and while they have high advocacy for luxury brands, their loyalty level is relatively low. These attitudes are common among Chinese consumers from Tier Two and Three cities



2.The Opinionated (20 per cent of spending, at an average EUR 1,750 per year): These are highly-educated Generation X and Y shoppers. They favor leather goods and watches, and are highly aware of the differences between brands. They shop often within their hometown, and are influenced by online information and social networks. They dominate China's Tier One cities and are also prevalent in Western Europe and the United States



3.The Investor (13 per cent of spending, at an average EUR 1,450 per year): These shoppers pay the greatest attention to the quality and durability of luxury materials. They favor long-lasting leather goods and watches which can be handed down from generation to generation. They carefully evaluate luxury purchases with research and referrals from other consumers. The segment comprises shoppers mainly from the Middle East with a high penetration of baby boomers.



4.The Hedonist (12 per cent of spending, at an average EUR 1,100 per year): These shoppers are infatuated with luxury goods and the luxury shopping experience. They have a high affinity for brand logos and are most influenced by advertising. Much of their purchasing is within the accessories categories. Despite their interest in luxury for show, they exhibit the lowest levels of advocacy for brands, often due to cognitive dissonance sometimes following purchase. This is the only cluster represented across all nationalities and generations



5.The Conservative (16 per cent of spending, at an average EUR 1,000 per year): These are mature and mainstream shoppers, both men and women, and favor watches and jewelry from big-name brands. They shop in multi-brand stores, and are influenced primarily by what friends and family recommend. They are mainly in mature markets



6.The Disillusioned (nine per cent of spending, at an average EUR 800 per year): These are mostly baby boomer shoppers who suffer from 'luxury fatigue' and purchase leather goods and beauty products. They look for products that last more than one season, but are unswayed by brand messaging or advertising. They tend to shop infrequently, and like shopping online when they can. The segment is dominated by women and is found in the United States, Europe, and Japan



7.The Wannabe (five per cent of spending, at an average EUR 500 per year): These predominantly female shoppers look for entry-level items in beauty and shoes, valuing affordability, and are highly likely to mix and match outside of the luxury spectrum. They are impulse shoppers who demonstrate little brand loyalty, primarily influenced by what their friends say and what they see in fashion publications. They come from the global middle class, especially in the United States, Western Europe, and new consumers in Eastern Europe



The report finds that while these segments may be concentrated in specific geographies, there are shoppers from every segment in every major global luxury market. There is a global cycle from the enthusiasm of Chinese, the Middle East and other emerging market consumers to the mature caution of markets such as the United States and Western Europe to the detachment of older shoppers and consumers in Japan. But within this cycle, there are significant country-level differences. Middle East shoppers are increasingly diverse and nuanced, ranging from a high degree of sophistication and luxury experience to luxury novices. The region emerges as the number one in luxury shopping in 2013 with EUR 1,400 spending per capita, whereas the global average is only EUR 650 spending per capita. Overall, Middle Eastern consumers are among the most 'generous' nationality, with nearly half of shopping for gifting (45 per cent versus an average of 40 per cent at global level)



The study confirms that the luxury market is still in the hands of baby boomers (45 per cent of luxury consumption worldwide) whose behaviors and preferences are quite different from their children (Generation Y). Younger generations are consumers of the future and continue to maintain positive attitudes to luxury. They present the most disparate profiles: from newbies to experts, from classic to edgy, from enthusiast to detractors; the fragmentation in luxury tastes of this group makes the consumer picture ever more complex to handle



"Enthusiasm may erode over time, but brands can either throw up their hands or see this as an opportunity to re-energize shoppers," concluded D'Arpizio. "In order to do so effectively, they must understand the full range of heterogeneous luxury consumer segmentations, execute relentlessly on reaching the segments that have the highest potential, and invest in capturing the attention and imagination of new potential shoppers who could be buying luxury today but who are not, while understanding how to delight and truly engage their current consumer base.


About Bain & Company, Inc.
Bain & Company, a leading global business consulting firm, serves clients on issues of strategy, operations, technology, organization and mergers and acquisitions. The firm was founded in 1973 on the principle that Bain consultants must measure their success by their clients' financial results. Bain clients have outperformed the stock market 4 to 1. With 50 offices in 32 countries, Bain has worked with over 4,600 major multinational, private equity and other corporations across every economic sector. Bain has analyzed the market and financial performance of more than 230 of the world's leading luxury goods companies and brands. The database of companies, known as the 'Luxury Goods Worldwide Market Observatory,' has become a leading and much studied source for the international luxury goods industry. Bain publishes its annual findings in its 'Luxury Goods Worldwide Market Study,' which was first published in 2000. For more information visit: www.bain.com. Follow us on Twitter @BainAlerts.About Redburn Partners LLPFounded in 2003, Redburn is Europe's largest independent equities broker. It is focused on providing institutional clients conflict-free research and high-touch execution across pan-European equity markets. It has 151 staff and covers 23 pan-European sectors, and offers leading technical and systematic research, and industry and company access services. Redburn was voted #1 in the Greenwich Associates Survey 2013 of UK institutions for 'Greatest Knowledge of Companies and Industries,' 'Quality of Analyst Service,' 'Most Creative Ideas or Themes' and 'Most Trusted Research,' and Number 1 globally in the 2013 Institutional Investor Survey for execution cost-effectiveness. Majority owned by its Partners and employees, Redburn has offices in London, New York and San Francisco.About Bain in the Middle EastBain & Company's work in the Middle East spans multiple industries including Financial Services, Energy and Industrials, Public Sector, Telecommunications, Media & Technology, Consumer Goods & Retail, Private Equity and Sovereign Wealth Funds. Our clients are major listed companies, state-owned enterprises, government entities, financial investors and private or family-owned business. Our consultants have graduated from the best international and regional schools and bring extensive practical experience working in the region and beyond. We work seamlessly as part of the global network bringing the best of Bain's industry and functional expertise to our clients. For more information visit: www.bain.com. Follow us on Twitter @BainMiddleEast.About Millward BrownMillward Brown is a leading global research agency specializing in advertising, marketing communications, media and brand equity research. It has been a true pioneer in brand tracking since 1973, we have conducted more than 18,000 brand tracking studies. In addition, it has tested more than 80,000 campaign in 86 countries across 5 continents with its LinkÔÇ× platform, and maintains Firefly, the world's largest qualitative network for brand research.

 






  MENA News Headlines
 Sep 2 2014 - Egypt military academy stampede kills 9Arab News
(MENAFN - Arab News) CAIRO Nine people were killed on Tuesday in a stampede outside a military academy in Egypt by relatives seeking to visit cadets the army said in a statement.The military released ...

 Sep 2 2014 - Attack on Egypt security convoy kills 11 in SinaiArab News
(MENAFN - Arab News) CAIRO: An attack on a convoy killed 11 members of the Egyptian security forces in the Sinai Peninsula on Tuesday security and medical sources said.Two were killed by a roadside ...

 Sep 2 2014 - UAE- Human League to perform in DubaiKhaleej Times
(MENAFN - Khaleej Times) The Human League bring their electro-pop back catalogue to Dubai New wave legends The Human League will bathe The Irish Village in synths for their show on Thursday September ...

 Sep 2 2014 - UAE- Ismail Matar backs Mahdis contract extensionKhaleej Times
(MENAFN - Khaleej Times) Matar hinted that het could be able to return to the pitch in two weeks time after covering half of the four-week period decided by the doctors for his recovery.Dubai: Al ...

 Sep 2 2014 - Dubai does well to curb thalassaemia in newbornsKhaleej Times
(MENAFN - Khaleej Times) Drop in the number of disease cases attributed to awareness campaigns screenings.The number of cases of thalassaemia in newborns in Dubai has drastically reduced due to the ...

 Sep 2 2014 - UAE- Umm Al Quwain offers 50 per cent off on traffic finesKhaleej Times
(MENAFN - Khaleej Times) The 50 per cent cut on pending fines includes unpaid fines for speeding and other traffic violations available till December 5.The UAQ Police are offering a 50 per cent ...

 Sep 2 2014 - UAE- Ajman launches online renewal of car registrationKhaleej Times
(MENAFN - Khaleej Times) The programme also provides the opportunity for public to renew their registration card without having to visit the traffic department.The Ajman Police on Monday launched its ...

 Sep 2 2014 - UAE- Cop accused of kidnapping raping womanKhaleej Times
(MENAFN - Khaleej Times) He drove her to a dark location near a construction site after offering a lift where he allegedly raped her.A cop has been charged in the Court of First Instance with ...

 Sep 2 2014 - UAE- Manager blackmails women staff for sex court hearsKhaleej Times
(MENAFN - Khaleej Times) Three women have complained against the 31-year-old man alleging that he had been constantly sexually harassing them.A Palestinian manager has been brought before the Court ...

 Sep 2 2014 - UAE- 22-year-old Indian found hanging from treeKhaleej Times
(MENAFN - Khaleej Times) Police patrols and paramedics were rushed to the spot who took down the body and transferred it to Al Dhaid Hospital for an autopsy.A 22-year-old Indian man was found hanging ...

more...


 






Google

 
 

Middle East North Africa - Financial Network

MENAFN News Market Data Countries Tools Section  
 

Middle East North Africa - Financial Network
Arabic MENAFN

Main News
News By Industry
News By Country

IPO News
Islamic Finance News
Private Equity News

How-To Guides
Technology Section

Travel Section

Search News

Market Indices
Quotes & Charts

Global Indices
Arab Indices

US Markets Details

Commodoties

Oil & Energy

Currencies Cross Rates
Currencies Updates
Currency Converter

USA Stocks
Arab Stocks
 

Algeria 
Bahrain 
Egypt 
Iraq
Jordan 
Kuwait 
Lebanon
Morocco 
Oman 
Palestine
Qatar 
Saudi Arabia 
Syria
Tunisia 
UAE 
Yemen

Weather
Investment Game
Economic Calendar
Financial Glossary

My MENAFN
Portfolio Tracker

Voting

Financial Calculators

RSS Feeds [XML]

Corporate Monitor

Events

Real Estate
Submit Your Property

Arab Research
Buy a Research

Press Releases
Submit your PR

Join Newsletters


 
© 2000 menafn.com All Rights Reserved.  Terms of Service | Privacy Policy | Contact Us | Advertise | About MENAFN | Career Opportunities | Feedback | Help