The impact of millennials on UAE's Fashion Industry

The Impact of Millennials on UAE’s Fashion Industry

The revenue from the United Arab Emirate’s (UAE) fashion industry was estimated at AED 4.3 billion (USD 1.2 billion) in 2019. The values were expected to reach  AED 5.3 billion (USD1.45 billion) in 2020. However, the COVID-19 pandemic has led to a decline in sales of most in-store retailers by nearly 50%. Consequently, e-Commerce has taken the center stage in UAE with the most significant consumers that contributed towards the growth of the fashion industry were millennials (29.2%).

As a result, many fashion retailers in the UAE are becoming digitalized due to the increased demand from the millennial consumers. According to estimates, UAE millennials on average spend between 4.5-6.5 hours browsing social media and over 51% of them make their purchases online. NAMSHI, AWOK, NOON, Brands For Less and 6th Street are some of the most popular fashion e-Commerce retailers in the country. 

In an increasingly emerging trend, it has been witnessed that millennials prefer online shopping as it is convenient, easy and affordable compared to in-store shopping. Also, due to access to smartphones and WiFi, over 60% of millennials in the UAE research, read reviews, compare prices before purchasing a product.

Moreover, businesses also understand the importance of social media influencers and their role in influencing purchase decisions of millennials. For instance, 63% of millennial consumers are more likely to buy a product which has been recommended by a social media influencer. Huda Kattan, Joelle Mardinian and Ola Alfares are some of the popular social media influencers in the UAE. 

In addition to technological advancements, millennials also expect a personalized experience from fashion brands. Recently, luxury fashion marketers have evolved their marketing strategy as they understand that millennials are no longer interested in the brand name alone but also consider the consumer experience provided by brands. 

Furthermore, due to the rising awareness of the environment, many millennials expect brands to be sustainable. Therefore, there is a spurt in the growth of sustainable brands in the UAE such as ATTUALE, The Luxury Closet but also fast-fashion retailers like H&M and Zara have become more sustainable. Overall, the millennial consumers are shaping the UAE’s fashion industry to become digitized, sustainable and also leverage e-Commerce platforms to effectively reach out to the target audience in UAE as they realize that online presence is key for success and growth in UAE. Approaching a Market Research firm in UAE can help the investors to understand the e-Commerce and fashion market before making investment decisions.

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Author: Jivika Tulsiani
ESMOD Fashion Business Student