July 27, 2016
Dolce & Gabbana Abaya collection, fall/winter 2016-17
High-spending Middle Eastern clientele hold a large growth potential for Western brands, provided marketers do their due diligence in getting to know these consumers and their cultures, according to a report from Fashionbi.
Recognizing the opportunities that exist in catering to Muslim consumers, a number of luxury brands have developed special collections, edits or campaigns that reflect their need for modesty. With increasing online penetration within the Middle East, social media, mobile marketing and ecommerce open up avenues for international brands to court consumers, but building a successful relationship requires a localized approach.
"According to the State of the Global Islamic Economy 2014-2015 report commissioned by Thomson Reuters and Dinar Standard estimates, by 2019, Muslims around the globe will have the $489 billion spending power; while in the west this segment already makes up for an estimated $100 billion market," said Ambika Zutshi, CEO of Fashionbi, Milan.
"Middle Eastern audience are also very digitally advanced, well educated, fashion conscious and earning for themselves a high social status," she said. "This is a huge opportunity for the brands to break-through with a disruptive offering that these consumers crave.
"But so far, analysis show that the brands haven't been able to win 100% the customer loyalty in this region, due to lack of right product offering, convenient shopping terms and so on. And since, there isn't yet an established benchmark yet, the brands can really strategize wisely to be the first market leader."
Consumer behavior
Within the Middle East, 40.2 percent of consumers have access to the Internet. However, some nations have much higher usage, like Kuwait’s 99 percent penetration.
Social media use today is most common among 18-35 year olds, with 88 percent of Internet users engaging with social networks on a daily basis. Beyond offering a way to connect with friends, social media is used in the Middle East as a means of expressing opinions that may not be accepted by the religious police.
Facebook, Twitter and Instagram, along with Snapchat and WhatsApp, are popular. With millions of video views daily, YouTube particularly has a great impact on purchase decisions.
A combination of generally youthful populations, high-speed Internet availability and high disposable incomes are pointing to rising mobile usage in places such as Saudi Arabia.
While paid search and search engine optimization are more sophisticated in regions like Europe, the Middle East boasts less competition for interested advertisers. Search engines are the most widely used research tool for Saudi Arabian consumers considering a purchase, who nine times out of 10 look products up online before buying.
Digital marketing should be localized for consumers, whether that means speaking to them in their own language in an email or sending special messages for large holidays such as the Islamic New Year Al Hirja or their country’s national day. English is accepted as an international business language, but for Middle Eastern consumers, a form closer to British than American English is preferred.
By the end of 2016, ecommerce sales in the Gulf States are expected to reach $20 billion, as the appeal of convenience moves spending from mega malls to online channels. The United Arab Emirates holds the highest online spenders, while Saudi Arabia follows.
Dubai Mall
When trying to strategize ecommerce services and selection for the Middle East, Fashiobi suggests looking at the successful local retailers. Effectively appealing to regional shoppers, many of these sites offer international shipping, free returns and cash on delivery, assuaging any concerns about payment security.
Going global
Many Middle Eastern brands and designers have established a global business, including Lebanon-born Elie Saab, Tunisian Azzedine Alaïa and Zuhair Muhad from Lebanon.
Florence Welch performs in Elie Saab; photo by Sandy Young/ Getty Images for Nobel Peace Prize Concert
At the same time, Western brands are responding to the demand for coverage.
From ad campaigns featuring women in veils to special collections designed with modesty in mind, labels such as Dolce & Gabbana and Burberry have looked to reach Muslim clientele, particularly around the festival of Ramadan.
The Dolce & Gabbana Abaya fall/winter 2016-17 collection includes a range of abayas and hijabs in the label’s bright and colorful prints such as flowers, fruit and polkadots. A number of the abayas and hijabs designed for the collection are made of silk while others are made with neutral lace and satin (see story).
Net-A-Porter has been mindful of its global consumers’ needs by carrying pieces specifically for Ramadan two years in a row.
For this year’s Ramadan Edit, Net-A-Porter will offer consumers exclusive collections by Oscar de la Renta and Etro, made specifically for the holy month. The Ramadan Edit on a whole includes apparel, accessories and footwear (see story).
Oscar de la Renta dress, part of Net-A-Porter's Ramadan edit
Here, timing is key to making a good impression, as launching at an inopportune time in the festival may come across as religiously uninformed or monetarily motivated.
"Besides the locally originated Elie Saab, Elie Tahari, Zuhair Murad, etc. who always give a touch of the traditional element from the Middle East in their collections, many local brands and online retailers are already establishing a strong hold in the Middle Eastern market," Ms. Zutshi said. "What they offer is either local or Western products at good offers, cash-on-delivery payment options, worldwide shipping availabilities and convenient after-sales services.
"What the Western brands also often forget is that a Middle Eastern consumer is not just confined within the region, they are scattered across the globe equally celebrating the local festivals as they would back home," she said. "When brands are launching the special Middle Eastern collections, they need to make sure to make it available worldwide in their physical stores as well as online.
"Another interesting aspect is to add a touch of customization to the products that these segment of consumers are known to appreciate and invest more in. Moreover, working with local influencers, which are already an inspiration for Middle Eastern women can only be the cherry on the cake."
Brands including Tiffany & Co., Gucci, Cartier and Louis Vuitton have worked with local influencers on campaigns, further enabling them to integrate themselves within Middle Eastern culture.
A photo posted by Ascia AKF (@ascia_akf) on Apr 28, 2016 at 12:51pm PDT
While Gulf State citizens have their own fashion needs, brands need to also remember their connection to the West. Many fashion-focused consumers are either former or current international students, returning home with a desire for a mix of modernity and tradition.
"As analyzed in Fashionbi's latest research on Middle East Fashion, an interesting fact about the Middle Eastern shoppers is that they are modern yet very traditional and culturally conscious in their choices of fashion," Ms. Zutshi said. "They also value more the quality, as most of them do have a high spending power than their Western counterparts.
"Many international labels such as Mango, Tommy Hilfiger, Burberry and others have entered the market with heir versions of special festive clothing, however, some of the pieces have received criticism due to their less-modest cuts and plunging necklines, etc.," she said. "While the Middle East market is very mature in terms of luxury consumption, they still are very attached to their roots and thus differ in their choice of clothing while attending the family gatherings versus going out with friends. And this is just one of the aspects that sets them apart.
"They are also very digitally active, with Facebook, Twitter, Instagram and even Snapchat being used multiple times on a daily basis. What brands need to do is, first of all, not rely on the superficial information and pretend to understand all about the culture and launch a special collection based on their little 'homework.'
"They really need to work with a local fashionista or an influencer to understand better the openness and readiness of the local consumer, which might differ country-to-country within the region, to be then able to tweak the ideas both in terms of product and its communication, accordingly.
"For instance, translating the Web sites with right keywords in English and all Middle Eastern languages. Investing in targeted Google Advertising," she said. "Then, targeted posts on the social media for Middle Eastern countries only that could include special offers or contests or handing over their Snapchat to the local influencers to spread the word, and so on."
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