Key Takeaways:
Known for its high-spending consumers, rapid economic development, and global influence, the Gulf Cooperation Council (GCC)—a political and economic alliance of six Middle Eastern countries—has become one of the world’s most resilient luxury markets. The Chalhoub Group just released its GCC 2024 Personal Luxury Report, GCC Personal Luxury 2024: Unstoppable, offering the most comprehensive overview of the macro-economic factors that are taking the market to new heights. Clocking in at $12.8 billion in retail sales and experiencing +6% year-over-year (YoY) growth, the region continues to outperform global markets, underscoring both the strength of consumer appetite and the region’s resilience in the luxury sector.
The insights from the report are the result of extensive research by the Chalhoub Group’s intelligence team, which analyzed luxury trends and drew insights from over 1,000 prestige beauty brands and retailers, encompassing data across all six GCC countries: the United Arab Emirates (UAE), the Kingdom of Saudi Arabia (KSA), Kuwait, Qatar, Bahrain, and Oman.
BeautyMatter caught up with Mo Shadman, Director of Insights at the Chalhoub Group, to understand what makes the region so uniquely different from any other, and why, despite a luxury cooldown, the GCC remains largely unscathed.
“As we analyze the findings of our latest GCC Personal Luxury report, the most significant finding would be that the luxury sector in our region continues to demonstrate resilience and adaptability despite global economic challenges," said Shadman. "With retail sales reaching $12.8 billion and a growth trajectory that outpaces the international average, we see tremendous potential for brands to leverage this momentum."
Driven primarily by a combination of five key macroeconomic drivers, the report forecasts that the market will reach $15 billion by 2027. Shadman identified five key factors that are propelling the upward trajectory of luxury in the GCC: favorable economic conditions, retail expansion, consumer spending habits, tourism resilience, and e-commerce growth.
“Strong government initiatives, particularly in Saudi Arabia and the UAE, are fostering a very conducive environment for luxury spending. This, combined with an evolving retail landscape involving new store openings and high-end mall developments, is enhancing consumer access to luxury brands and products," said Shadman.
Additionally, disposable incomes are rising, which is boosting consumer confidence and driving robust demand for luxury products. He added that rising disposable incomes are further boosting consumer confidence and fueling robust demand for luxury products.
“The transition towards online shopping is accelerating, with e-commerce outpacing global growth rates as consumer behaviors evolve. And finally, despite regional geopolitical challenges, the region continues to remain an attractive tourism hub which in turn drives luxury sales," he concluded.
Skincare Drives Maximum Growth, but Fragrances Retain the Majority Market Share
While the report analyzed data across four personal luxury categories, beauty emerged as the fastest growing category with +12% YoY growth, led by skincare driving the highest growth at +17%. Prestige beauty accounts for the majority of the luxury market in the GCC, and legacy beauty brands continue to hold a dominant position.
“Legacy brands like L’Occitane, Charlotte Tilbury, The Ordinary, Drunk Elephant, and Fenty have emerged as the top performers. This can be attributed to their existing strong global presence," said Shadman.
With offline shopping remaining the preferred choice, particularly for brand discovery, Sephora continues to be the largest beauty player in the region, followed by Faces.
However, even though skincare drove the maximum growth, fragrances held the largest share of the beauty market, with a 49% market share. Brands like Guerlain, Parfums de Marly, Louis Vuitton, and Prada performed the best.
“While legacy brands continue to dominate market share, 40% of total fragrance sales are now largely driven by private collections and niche brands," said Shadman.
Makeup accounted for 37% of the category and experienced double-digit growth. “Makeup is witnessing extremely promising growth; this is driven by selective distribution brands like Fenty Beauty, Urban Decay, Too Faced, IT Cosmetics, and new entrants like Saie, Kosas, and Glossier that are resonating strongly with younger consumers," he added.
What Do GCC Beauty Consumers Want?
As a market that is evolving at breakneck speed, with a growing expatriate population and an appetite for discovering and engaging with new brands, the GCC is entering a new chapter in luxury—a phase where the lines between digital and physical, discovery and purchase, and experience and transaction are increasingly blurred. Consumers in the region are becoming increasingly discerning and demanding seamless beauty experiences, whether that is while discovering a new brand on social media, trying out a new launch in-store, or receiving personalized recommendations at their favorite retailers.
“This next phase of luxury consumption will be driven by rising consumer expectations, generational shifts, and a stronger desire for emotional connection, storytelling, and more curated experiences," said Shadman.
This provides an exciting opportunity for brands to find new ways to offer more boundary-pushing experiences that resonate with consumers, on a deep, cultural, and cerebral level.
“Looking ahead, new retail developments will give brands more opportunities to elevate service and experience to meet the evolving expectations of the GCC consumer," he added.
Physical Retail Reigns Supreme
Despite the rise of e-commerce, consumers in the region remain partial to physical shopping. Given the region’s deep-rooted mall culture where shopping is a recreational, communal, and immersive experience, physical retail remains the preferred channel for shopping and discovery.
"Physical retail remains critical and in-store experiences continue to drive discovery, brand engagement, and high-value purchases, especially in luxury, where sensory experience and personalized service are essential," said Shadman.
Tapping into the growing desire for more experiential and community-driven shopping experiences, malls in the region are being reimagined to become more than just places to shop—they’re evolving into cultural, lifestyle hubs. In these new retail destinations, shopping and discovery are becoming seamlessly intertwined with entertainment to attract a new generation of consumers who are demanding connection, inspiration, and leisure all in one place.
“New mall developments and store openings are serving as powerful magnets for both local consumers and tourists, creating vibrant hubs that blend shopping, lifestyle, and entertainment," he added.
As malls evolve into even broader lifestyle destinations, the numbers are already reflecting this impact. According to the report, in Q1 2025, beauty sales grew by 23%, with part of this growth attributed to the opening of the Solitaire Mall in February in Saudi Arabia.
“The numbers speak for themselves; brick-and-mortar is still the most critical channel for luxury shopping. Looking ahead, seven new malls featuring luxury brands are scheduled to open across the UAE and KSA by 2027, and these developments will undoubtedly further accelerate and boost the GCC’s luxury market,” he added.
E-Commerce Shows Strong Growth Potential
While consumers in the region prioritize in-person shopping over online channels, the region currently boasts one of the most digitally savvy consumer bases, which is increasingly prioritizing convenience.
“The GCC is experiencing a surge in luxury e-commerce, with online sales now accounting for 13% of the market—still below the global average of 20% but showing strong growth potential,” said Shadman. In 2024, the region’s online luxury channel grew by 13%, significantly outpacing the global market, which saw a decline of 4% to 1%.
“Digital acceleration in the region is being fueled by several factors like increased domestic demand, an influx of affluent shoppers, strong adoption of digital and omnichannel experiences, and the rapid expansion of emerging categories such as skincare and Asian beauty,” he said.
Consumers in the region are finally opening up to the idea of trying and testing new skincare products, with a strong affinity towards Asian-made products, particularly K-beauty. This marks a pivotal shift from traditional preferences, as digitally savvy, young consumers heavily influenced by social media are drawn to innovation, efficacy, and ingredient-led formulations, and are embracing the journey of discovery and experimentation.
The Future of Beauty in the GCC
With the market expected to reach $15 billion by 2027, the region is poised for continued growth, making it a key market in both global and local expansion strategies.
“Growth for the next two to three years will be driven by robust local spending along with a continued expected flow of tourists and wealthy expats,” said Shadman.
This momentum will be further exacerbated by a wave of new retail developments, along with a new generation of luxury brands entering the market, which will introduce consumers to brands beyond the legacy ones they are familiar with.
“Emerging categories like skincare, wellness, and Asian beauty will reshape consumer behavior and redefine luxury," he added.
While brick-and-mortar retailers will continue to thrive, e-commerce will accelerate, and consumers will increasingly embrace omnichannel experiences. Brands and retailers that can seamlessly blend digital and physical touchpoints will be positioned to win.
"Together, these shifts are setting the stage for the region to not only sustain but also redefine the next chapter of global luxury growth,” he added.
