Under Vision 2030, Saudi Arabia is entering a new era of innovation, enterprise, and openness — one that will turn the kingdom into a hub for luxury in the Middle East.
“I want it to be the number one luxury market in the world — to really be leading,” said Saudi Arabia’s Prince Bandar bin Saud bin Khalid Al Saud in a report. “We have what it takes. I don’t think we lack the will, and I don’t think we lack the imagination, or the ambition.”
Driving this growth is the country’s expanding number of affluent consumers, who are raising the standards for luxury brands and bespoke experiences, along with empowered women and a sizable youth population under 30.
These findings are outlined in a new report titled, “New Codes of Luxury in Saudi Arabia,” published by trend forecasting consultancy The Future Laboratory yesterday. The study delves into the Saudi consumer’s evolving preferences for luxury and the ways brands can approach the burgeoning market.
Saudi’s highly discerning ultra-rich#
According to Euromonitor International, Saudi Arabia is expected to boast 203,000 millionaires by 2030. Meanwhile, the number of ultra-rich individuals with a net worth exceeding $30 million is forecast to grow by 10.4 percent in 2024, per Knight Frank.
These consumers, like their global counterparts, have the highest standards for brands. They’re well traveled, well educated, and often make their luxury purchases outside the kingdom, giving them exposure to the top luxury experiences across the globe.
“While some value is still placed on status and overt luxury, this is most definitely changing,” said Future Laboratory co-founder Chris Sanderson in a webinar held yesterday to present the report. “Gone are the days of conspicuous displays of wealth, which are now being replaced in favor of privacy, market know-how or savoir-faire, and hyper-personalization.”
“Gone are the days of conspicuous displays of wealth, which are now being replaced in favor of privacy, market know-how or savoir-faire, and hyper-personalization.”
In a survey of Saudi nationals, 60 percent of those earning over $266,000 (SAR 1 million) said that personalized offerings significantly affect their decision to engage with a luxury brand or service. This embrace of personalization extends to services as well: 42 percent of this income bracket reported that they use concierge-style luxury services at least once a month.
As Georgia Fendley, founder of luxury design agency Construct, writes in the report: “At this level of luxury, we’re speaking to an audience of one. So we try to avoid ever thinking about a demographic.”
For brands, that means creating “money-can’t-buy moments.” Piaget, for example, hosted an open-air concert in the desert of AlUla, inviting its very important clients (VICs) to party alongside the company’s chairman Yves Piaget and former CEO Chabi Nouri.
Saudi’s working women#
Saudi women are becoming a crucial luxury consumer group as Vision 2030 increases their participation in the workforce. In particular, there has been a surge in women entrepreneurs, with Saudi Arabia issuing 139,754 new commercial licenses to women in 2021.
“When we’re talking about luxury, females did not or were not able to work as they are today; they weren't able to bring back the amount of money at the end of the month,” said Jana Bader, a strategic marketing and retail consultant from Saudi Arabia, in the webinar. “But now they are, and they are young, and a lot of them are unmarried. So, then they are thinking, ‘Great, let’s build something for myself.’”
And their purchasing power should not be overlooked. Women in Saudi Arabia lead the global charts in makeup and skincare spending, while women in the wider Gulf region spend 55 percent more than men on average across the beauty industry. They are also fueling expansion in various product categories, especially in automotive (women were granted the right to drive in 2017), giving rise to smaller, sleeker cars being supplied to the market.
Their growing role in the public sphere has also led to more opportunities to express their personality and creativity through their purchases.
“Previously, the key product categories for women were mainly evening wear, accessories, and fine jewelry,” Rachel Ingram, co-CEO of luxury strategy agency Folk, was quoted as saying in the report. “But now there is more interest in contemporary brands, ready-to-wear fashion, and athleisure coming out of Saudi Arabia because people are getting dressed for different occasions. They’re getting dressed for the workforce.”
Saudi’s nationally proud youth#
With 63 percent of its population below the age of 30, Saudi Arabia is shaping up to be one of the world’s most critical Gen Z and Gen Alpha markets.
This is a digitally-driven generation, with 46 percent of affluent 18 to 34-year-old Saudis predominantly purchasing luxury goods online. It is also a “generation of socialization,” where shopping is a major pastime, said Skye Fisher, chief experience officer, Mohammed Bin Salman Nonprofit City, during the webinar.
While they adopt global trends and largely prefer European luxury brands, 95 percent of this cohort thinks it is important for brands to support and engage with Saudi-first enterprises and celebrate local design. This could look like offering localized collections or special seasonal offerings during Ramadan, the Islamic month of fasting.
“Young Saudis want to respect their culture and live their culture, but they want to be global. They want to assimilate with the rest of the world,” Fisher added in the report.
Breaking stereotypes#
In the February 20 webinar, Sanderson urged viewers to “forget the traditional notions and stereotypes of what you believe a luxury consumer in Saudi Arabia looks like and instead recognize the reality of Saudi’s luxury market as female-driven, youth-dense, and highly discerning.”
No longer are Saudi consumers solely focused on ostentation and high visibility. Rather, they are prioritizing innovation, personalization, and the seamless integration of technology, even above exclusivity and limited availability.
Across the three main consumer groups, Saudis want international brands that align with their values, whether that’s speaking out for women’s empowerment, celebrating local craftsmanship and traditional ingredients, or offering products that are sustainable, halal, and suited to the climate.
Brands that want to tap the Saudi market need to ditch the strategies of years past and embrace the consumer of today. The future of Saudi Arabia and, by extension, the Middle East is being shaped before our eyes, and the new codes of luxury that arise will undoubtedly ripple across the global industry.