The world of Luxury
French Business Council
Kuwait December 5th 2011
About Habchi & Chalhoub
•HABCHI Office has been established in Kuwait in 1967
when Mr. Michel CHALHOUB and Mr. Ali HABCHI started
their long partnership.
•HABCHI & CHALHOUB founded in its actual legal form in
1975.
•The 1st Tanagra opened the 18th December 1979 in
Salhiya Complex. Divided into 8 shops, Tanagra is the
flagship store of HABCHI & CHALHOUB.
About Habchi & Chalhoub
•Habchi & Chalhoub is totally focused on luxury and branded
products in the Kuwaiti Market. HABCHI & CHALHOUB has also a
good benefit from mass market .
•As a major distributor and retailer, Habchi & Chalhoub benefits
from adequate organisational structures meeting the
requirements of the market and over 700 team members
working in Kuwait.
• Habchi & Chalhoub has developed an important network of
distribution and retail in Kuwait and has crafted its own way of
doing business in a professional and passionate way.
The Chalhoub Group…
Regional coverage of 14 countries
Local presence in 11 countries
Over 400 retail outlets across the region
Team of over 7,000 personnel
OUR ACTIVITIES
HUMAN
RESOURCES
BEAUTY RETAIL
INFORMATION
TECHNOLOGY
LOGISTICS
SUPPORT SERVICES
MARKETING &
GIFT & FASHION
COMMUNICATION
LEGAL AND
FINANCE
Strategy & innovation
DISTRIBUTION
Distribution Division
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Habchi & Chalhoub is the main distributor of famous and prestigious
brands.
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Our portfolio is mainly composed of selective perfumes and cosmetics.
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A professional team of over 200 sales persons distributing more than 30
brands and covering the market.
Distribution Division/Perfume and Cosmetic Brands:
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Gian Franco Ferre
Chanel
Givenchy
Bourjois
Make Up For Ever
Helena Rubinstein
Ralph Lauren
Cacharel
Nina Ricci
Carolina Herrera
Paco Rabanne
Prada
Jennifer Lopez
Sarah Jessica Parker
IsaDora
Nouba
Comme Des Garcons
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S.T. Dupont
Etienne Aigner
Joop
Jil Sander
Nikos
Paul Smith
Hermes
Lacoste
Lanvin
Markwins
Kenneth Cole
Mango
Paloma Picasso
Roberto Cavali
Davidoff
Diesel
Retail Fashion & Gifts
• Habchi & Chalhoub owns and operates more than 45 retail
stores in the most luxurious shopping malls, hotels and hospitals.
Fashion and Gifts
• 1 Longchamp
• 1 Mulberry
• 1 Tagz
• 1 Scarpe
• 1 Geox
• 1 Paul Smith
• 1 MMK
• 1 Carolina Herrera
• 3 Lacoste
• 1 Celine
• 1 The Deal
• 1 Bonpoint
• 1 Louboutin
Beauty
• 1 Tumi
• 2 Swarovski
• 8 Visitors
• 3 Tanagra
• Christofle
• Baccarat
• Bernardaud
• Daum
• Mikimoto
• 1 L‟Occitane
• 8 Faces
• 1 Make Up For
Ever
• Tanagra (Fanar)
• Tanagra
(Mohallab)
• Perfume section
in „Tanagra‟ &
„Visitor‟ shops
Luxury: a premium matter
expensive
high quality
desirable
Luxury is….
source: Chalhoub Group, Youth and Luxury 2010, conducted on 1,300 15-29 GCC locals
Luxury: a matter of self
expensive
high quality
desirable
tells people
who I am
makes me feel
good
makes me feel
special
Luxury is….
source: Chalhoub Group, Youth and Luxury 2010, conducted on 1,300 15-29 GCC locals
Luxury in the
Middle East:
market
perspectives
&
consumer
dynamics
Polarized Middle East region
Middle East
GCC
population 2010
282 million
40 million
15%
US$
1 trillion
56%
GDP 2010
US$
1.8 trillion
source: IMF
GCC: favourable outlook
GCC GDP growth
+7.8%
+7%
+ 20% Qatar
+5.2%
+ 7.5% S.Arabia
+ 5.3% Kuwait
+ 3.3% UAE
+0.6%
2008
2009
2010
2011
vs. US: 2.8% - Russia: 4.8% - China: 9.6% (2011 forecast)
source: IMF
GCC: social fabric
young populations
50% under
30 years old
indigenous
unemployment
30% of youth
source: Brookings Institution, UN
GCC: social fabric
source: Alesco
expatriate-reliant
30%-85%
varied education
levels
6% - 12%
illiteracy
GCC: economic dynamics
oil-dependant
large infrastructure
projects
source: CIA factbook, MEED
90% gvt income
Kuwait/S.Arabia
US$2 trillion
planned/underway
GCC: economic dynamics
tourism strength
air travel hub
source: DTCM & ADTA, BMI, IATA H1 2011
UAE: 10.4 million
KSA: 13 million
ME +8.9% vs int‟l
+7.8%
GCC: economic dynamics
source: DTCM, Goup estimate
Dubai hub
3rd largest re-
retail boom
+145% in 5 years
export centre
Key to retail boom
real
estate
growth
shoppertainment
mega malls
tourist
destination
New retail landscape
real
estate
growth
shoppertainment
tourist
destination
mega malls
lifestyle
driven
district malls
communitybased
Dubai: Downtown district
Dubai
Downtown
Burj Khalifa
Retail GLA:
500,000 sqm
Abu Dhabi: Sowwah island
Abu Dhabi
Sowwah
Island
Retail GLA:
40,000 sqm
Abu Dhabi: Saadiyat island
Abu Dhabi
Saadiyat
Island
Qatar: The Pearl
The Pearl –
Porto
Arabia
Retail GLA
190,000 sqm
Top retail destination
#1 top targeted retail
destination in the world
Dubai
Dubai Duty Free $1.5 billion
sales
Kuwait
Riyadh
source: CBRE, Dubai Duty Free
Among Top 20
retail destinations in the
world
Top luxury destination
fashion-driven
hospitality
2009
2010
Dubai, Cavalli club
2011
Top luxury destination
fashion-driven
hospitality
2009
2010
Dubai, Armani hotel & residences
2011
Top luxury destination
fashion-driven
hospitality
2009
2010
Kuwait, Missoni hotel
2011
Top luxury destination
fashion-driven
hospitality
2012+
Dubai, Versace hotel & residences
Top luxury destination
fashion-driven
hospitality
2012+
Dubai, Fashion TV hotel
Diversification strategies: retail growth
GCC retail GLA
2005
2010
4.2m sqm
10.3m sqm
+145%
UAE retail GLA
2005
2010
1.4m sqm
4m sqm
+185%
source: Chalhoub Group estimates
With room for growth
GLA shopping mall supply per capita in m2
GCC
S.Arabia
<
Recommended
<
Dubai
<
USA
0.3
Kuwait
ICSC
0.3
Qatar
1.1
1.4
2.1
0.5
UAE
0.8
source: ICSC, Chalhoub Group estimates
With room for growth
Regional high-end fashion brand network weighted by market
Chalhoub Group and competitors
Lebanon
1.5%
Kuwait
15%
Bahrain
11%
Qatar
8%
Egypt
0.8%
Dubai
40%
Jeddah
9%
Riyadh
11%
Abu Dhabi
4.5%
source: Chalhoub Group estimates
With room for growth
market
Beauty, Fashion, Gifts: YTD Oct 2011
UAE
$US 15,000 – 60,000+
KSA
$US 6,500 – 40,000
KWT
QAT
retail productivity
per sqm
$US 12,000 – 60,000
$US 14,000 – 60,000
source: Chalhoub Group estimates
Retail panorama – Kuwait
Salhiya Complex
Al Hamra Mall
The Avenues
360 Mall
Destination
Selective
Kuwait, Kuwait City
The Avenues
Retail GLA: 168,000 sqm + upcoming
Opening date: 2007 – phase 3 2012
Al Hamra Mall
Retail GLA: 25,000 sqm
Opening date: Feb 2012
Salhiya Complex
Retail GLA: 14,000 sqm
Opening date: 1978
360 Kuwait
Retail GLA: 75,000 sqm
Opening date: July 2009
Consumer dynamics
high disposible
incomes
young
populations
strong
purchasing
power
shopping
addition
particular
consumer favourable attitudes and
stimulate
behaviours
Shifting consumer mindset
euphoric
optimistic
naïve
savvy
passive
confident
Conflicting consumer aspirations
social codes
traditional
VS
individual
expression
VS
personal
style
Conflicting consumer aspirations
brands
well-known,
reputable
VS
products
VS
new, unique,
trendy
Well-known “approved” brands…
My key influences are….
79%
66%
52%
44%
Friends
Spouse
Siblings
Mother
source: Chalhoub Group, Youth and Luxury 2010, conducted on 1,300 15-29 GCC locals
Seeking approval…
« I shop with my clan »
70% shop with
friends
40% shop with
mothers and sisters
source: Chalhoub Group, Youth and Luxury 2010, conducted on 1,300 15-29 GCC locals
Well-known reputable brands…
I like my brands to be….
79%
20%
1%
Very visible & always Visible & sometimes
recognisable
recognisable
Not visible & never
recognsiable
source: Chalhoub Group, Youth and Luxury 2010, conducted on 1,300 15-29 GCC locals
…favouring umbrella brands
S.Arabia
UAE
Kuwait
Europe
Clothes
Chanel
Dior
Givenchy
Armani
Dior
Calvin
Klein
Armani
Chanel
Gucci
Chanel
Valentino
L. Vuitton
Shoes
Chanel
Dior
Gucci
Dior
D&G
Fendi
Gucci
Chanel
Armani
Louboutin
M. Blahnik
J. Choo
Bags
My favourite luxury brands….
Chanel
Dior
Givenchy
Dior
Calvin
Klein
Gucci
Gucci
Hermes
Chanel
J. Choo
source: Chalhoub Group, U&A 09, conducted on 2,000 GCC females
Chanel
Dior
Polarized consumers
Saudi Arabia
UAE
Kuwait
passive
aspirational
assertive
convergent in
brand choice
wide array in
brand consumption
versatile in
brand consumption
strongly attracted
to anchor labels
preference for
anchor labels
less involved in
visible branding
Polarized markets
Saudi Arabia
UAE
Kuwait
passive
aspirational
assertive
underdeveloped
saturated
room for growth
Driving luxury beyond the Middle East
GCC consumers abroad
KSA#1 Kuwait #2 UAE #6
luxury consumers in
London
source: West End Company 2011
KSA spend 15 times more
than UK shoppers in
London
Top luxury destination
ME Luxury Market
Source: Bain & Co, 2011
GCC Selective Beauty
Source: Estimate based on GCC
shared wholesale figures
GCC Luxury Fashion
& Acc. Industry
Estimate
$US5.6 bn
2010
+ 10-12% by
2013
US$1.055 bn
US$1.5bn 2 bn
Complex category dynamics
clothes
30%
bags
45%
shoes
20%
accessories
5%
Fashion category requisites
clothes
50%
accessories
50%
Yves Saint Laurent
roady bag for UAE
adapted
strategy
Fashion category requisites
clothes
50%
accessories
50%
Bottega Veneta
Dubai clutch
adapted
strategy
Fashion category requisites
clothes
50%
accessories
50%
Carolina Herrera
Dubai tote
adapted
strategy
Fashion category requisites
clothes
50%
accessories
50%
Carolina Herrera
Abu Dhabi shopping bag
adapted
strategy
Drivers & perspectives…
young populations
luxury drive
high disposable
incomes
maturing retail
environment
edited
product offer
localised
marketing &
communication
tailored
service
consumercentric
approach
inspirational
store experience
Thank You