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Perfume Sales Top $370 Million in Record Year for Dubai Duty Free

Published January 9, 2024
Published January 9, 2024
Dubai Duty Free

As expected, the perfumes category retained its sales lead at Dubai Duty Free (DDF), ringing up $374 million in 2023, versus $311 million the year before. In total, the core retailer at Dubai International Airport, achieved a new high, with annual revenue of 7.885 billion UAE dirhams ($2.16 billion) last year, beating the pre-COVID 2019 record of just over $2 billion.

While perfumes retained the top spot, their growth of 20.3% fell below the 24.1% average seen across the overall business at government-owned DDF in its fortieth anniversary year. This meant that the perfumes category lost share versus other categories, dropping from 18% in 2022 to 17% in 2023.

Furthermore, cosmetics were again absent from the top five, displaced by the liquor, gold, cigarettes/tobacco, and electronics segments, plus confectionery, into seventh place. Its market share is understood to have dropped by more than half, from more than 11% in 2019 to less than around 5% currently. This was despite Chinese travelers—who love their cosmetics—rebounding to become the third biggest shopping nationality for DDF, behind Russians, and Indians in first place.

This leaves the overall beauty category in a catch-up position in terms of regaining its sales share. The lost ground is important because Dubai International Airport is the world’s busiest hub for international traffic (2022 data) and, to some degree, a weather vane for the airport duty-free business worldwide.

End-of-Year Sales Drivers

However, given the overall rise in sales and hitting a new record in its fortieth anniversary year, Dubai Duty Free is not losing sleep over the performance of beauty. Executive Vice Chairman and CEO Colm McLoughlin described 2023 as a “fantastic year.”

The fortieth anniversary celebrations took place in December when the company also had a record month with sales of $221 million, an 8.4% increase compared to the same month in 2022. December anniversary marketing activity helped, fueled by a 25% discount on December 20 for all passengers. This resulted in a shopping spree that bagged $14.8 million during a 24-hour period.

For beauty, there may be struggles ahead. In 2019, the Chinese had a much bigger share of sales at DDF. Pre-pandemic, Chinese travelers accounted for 4% of passengers at Dubai International Airport, but 17% of Dubai Duty Free’s sales. Moreover, their favorite category to shop was cosmetics with a 34.2% share. Last year that fell to less than half at around 16%.

The top spending nationality—Indians—is not big on cosmetics. The category makes up about 2% of their spending, although perfumes do better at 11%. For Indians, wine and spirits, and gold are the drivers at 29% and 17% respectively.

This year, Dubai Duty Free will be enhancing its retail operations with major refurbishment plans for Concourse B, which will be completed soon. Meanwhile, in Concourse A, two perfumes and cosmetics shops and a fashion area will also be refurbished starting in the second quarter and finished in early to mid-2025, featuring three new boutiques of major fashion brands.

The retailer is also working on the scheduled renovations of three arrivals shops in the current quarter, with construction to continue until the second to third quarters of 2024.


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