Luxury Marketing- Essay Example | Topics and Well Written Essays - 1250 words

Luxury Marketing- - Essay Example The GDP per capita as on 2012 is $49,000 that positions it at rank 16 as compared to other countries2. 1.2 Demographic UAE is considered to have the world’s third best demographic profile after Qatar and Macau (China). According to the reports of the International Labour Organization a quarter of the population is estimated to be 4.8 million and is categorised under non-working age who are dependent either on their family members or on support from the government3. 1.3 Social and Cultural After Abu Dhabi started to export oil, the society of the country also started to transform. Emiratis are traditionally conservative but UAE is considered to one of the most liberal countries in the Gulf. Other believes and cultures are tolerated especially in Dubai4. 1.4 Technology UAE has spent about $5 billion (Dh 18.36 billion) as an investment towards technological upgradation. The main aim behind doing this was to make UAE the fastest growing region of the world in spending towards info rmation technology5. 1.5 Political Politically the region remains authoritarian. Until 2006 it remained as the as the only country that do not have elected bodies. In 2012 restriction was introduced related to usage of internet. However the authority of UAE tries to reduce the dependency on oil export and diversify the economy by creating boom in the tourism, construction and business sector6. 2. Industry Analysis 2.1 Overview Fragrance Foundation Arabia has claimed that a significant growth has been marked by the regional and global fragrance industry and is seen to get almost double from US$ 17 billion in the year 2010 to US$ 33.5 billion by 2015. More specifically a research by Euromonitor International stated that UAE has witnessed a high-end sales growth of signature products at a compounded annual growth rate of 5.4% and reach AED663.5 million by 2014. The sale in the mass fragrance for the same period is also expected to be AED247.9 million7. This is a clear indication of tha t the market of UAE has a preference for luxury goods and more specifically high-end products. 2.2 Entry Barriers The major entry barriers are the competitors operating in the market like Clive Christian, Tom Ford and Yves Saint Laurent who are some of the prominent players in the oud-based fragrance market. In UAE there are 3000 brands operating8. 2.3 Trends The current trends suggests that previously about 70% of the business was dominated by oud-based perfume but now it has reduced to only 30% and rest are occidental perfumes9. As per the survey record of UAE Ministry of Economy the per month average household income of the residents is AED18,248.60. The report has also revealed that the AED11,241.20 is the average household expenditure of the resident in one month with most of the income spent on drinks and food10. The age structure of UAE is 20.6% of the total population is between the age group of 0-14 years (male 577,599 and female 551,346), 13.8% is between the age group of 15-24 years (male 449,258 and female 306,410), 61.5% is between the age group of 22-54 years (male 2,570,054 and female 798,070), 3.1% is between the age group of 55-64 years (male 127,569 and female 40,996) and only 1% is above 65 years (male 33,481 and female 19,189) as on 201311. 2.4 Success factors Lifestyle of the people has changed. Now they want to look good and in fact smell good. Strong economy has made the region and the fragrance sector more lucrative. Growth in the expat population also plays a major role in