Why Global Luxury Brands Are Expanding in Saudi Arabia

RIYADH: Saudi Arabia is rising on the priority list of the global luxury industry as brands expand their presence to capture growing domestic demand, experts have told Arab News.

The expansion comes as the Kingdom builds out its retail, hospitality and entertainment sectors under Vision 2030, creating more occasions to consume luxury while bringing international brands closer to Saudi customers who previously made many high-end purchases abroad.

Tourism developments are widening the market further. In June, Four Seasons opened at Amaala’s Triple Bay on the northwestern coast, while InterContinental Hotels & Resorts told Arab News that month that it expects its Luxury & Lifestyle portfolio in Saudi Arabia to expand to six brands by 2028.

Market shift

For Lebanese luxury fashion house Georges Hobeika, the transformation is visible in how it serves Saudi clients.

“Ten years ago, Saudi Arabia was a market we served from a distance, through Gulf retailers or private trunk shows abroad. That’s changed completely,” Fadi Roumieh, communications manager at Georges Hobeika, told Arab News.

He pointed to local retail infrastructure, a growing domestic events calendar and a new generation of Saudi stylists and content creators as factors reshaping the market.

Roumieh said changes associated with Vision 2030 had compressed what might otherwise have been a decade of demand growth into several years.

In practical terms, he said, that means more fittings in Riyadh and Jeddah, more dressing linked to Saudi red carpets and galas, and clients expecting a level of service comparable to the house’s Paris atelier.

That transformation is also reflected in what Saudi customers are buying and the level of knowledge they bring to purchasing decisions.

“Clients today know the difference between a house’s couture and its ready-to-wear, and they ask for exactly what they want,” Roumieh said.

Purchases are moving beyond major occasions such as weddings toward fuller wardrobes encompassing evening wear and considered daywear.

Saudi customers also show an appetite for modest silhouettes, embroidery and an Arab sensibility executed to couture standards, he added.

That is influencing Georges Hobeika before garments even reach the market. On bridal, the house considers Saudi preferences from the sketch stage rather than adapting products afterward, while private fittings and trunk shows are timed around the local calendar.

Roumieh said the expanding events sector is acting as a multiplier because every gala or film premiere creates another dressing occasion that can gain regional visibility through Saudi creators.

He sees the Kingdom becoming a commercial and cultural anchor for luxury across the region, with the strongest opportunity going to houses that build lasting relationships rather than stage isolated activations.

Growth drivers

The shift is occurring even as the wider global luxury industry enters a more moderate growth period.

Kearney’s 2026 Global Luxury Industry Outlook forecasts global luxury growth of 2 to 4 percent, while Saudi Arabia continues to rank among the GCC’s strongest growth markets.

Ali Shahid, partner at Kearney Middle East and Africa’s Consumer and Retail Practice, told Arab News that economic diversification, multinational regional headquarters, rising female workforce participation and an increasingly attractive investment environment are helping underpin demand.

The new Investment Law and tourist VAT refund scheme have strengthened the environment further, he said.

Shahid also pointed to the expansion of premium retail destinations including Solitaire and VIA Riyadh, with The Avenues Riyadh and Diriyah Square among developments in the pipeline.

International brands are responding. Shahid cited Louis Vuitton, Dior and Celine at Solitaire alongside first Saudi openings for brands including Missoni, Eleventy, Corneliani and ISAIA.

Saudi Arabia is also the largest and fastest-growing jewelry market in the GCC and the biggest contributor to fragrance growth, according to Kearney’s work with regional luxury brands and retailers.

Shahid said the Kingdom has an advantage over Gulf markets that rely more heavily on international visitors because Saudi luxury consumption is largely driven by domestic customers. This makes the market comparatively resilient to travel disruptions while still allowing brands to benefit from growing tourism.

That could become increasingly significant as Saudi Arabia works toward its Vision 2030 target of 150 million annual visitors by 2030, supported by destinations including Diriyah, the Red Sea and AlUla.

Brands are also becoming more “glocal,” Shahid said, combining flagship stores and global assortments with culturally relevant service, digital engagement, personalization and local partnerships.

Consumer change

Regional data also points to changes in how consumers understand and engage with luxury.

Raluca Marcu, a Dubai-based image scientist, told Arab News that the GCC personal luxury market reached $12.8 billion in 2024, expanding 6 percent despite an estimated 2 percent contraction globally.

Fashion represented 43 percent of the regional personal luxury market, while jewelry grew 7 percent and watches remained stable even as the category declined globally, according to figures she cited.

“The visual language of luxury is becoming more layered,” Marcu said. “The signal is moving from ‘I can afford this,’ toward ‘I understand what I am choosing and it means something to me.’”

She said consumers are increasingly informed and selective, placing greater emphasis on craftsmanship, provenance, exclusivity and personal meaning rather than price or logos alone.

Online sales accounted for 13 percent of GCC personal luxury sales in 2024, while the regional online channel grew 13 percent, Marcu said.

“This doesn’t mean the physical boutique is becoming less important,” she added. “It means the journey between digital discovery and physical experience needs to become almost invisible.”

Saudi Arabia’s wider fashion market was projected at $36.8 billion in 2025, with compound annual growth of about 6.4 percent through 2029, according to Saudi Fashion Commission figures cited by Marcu. The projection covers the overall fashion sector rather than luxury alone.

Chalhoub Group forecasts the GCC personal luxury market will reach $15 billion by 2027, up from $12.8 billion in 2024.

Local role

The expansion of international luxury is also creating opportunities for Saudi and regional brands, although established global houses continue to capture the majority of high-end spending.

Mohammed Kazim, co-founder of cultural enterprise and lifestyle company Tamashee and Tamashee Experience, told Arab News that demand for high-quality local brands is increasing as consumers seek products reflecting regional identity and craftsmanship.

Kazim said consumers remain less willing to pay luxury-level prices for locally made products, leaving room for regional brands to change perceptions around their quality, craftsmanship and prestige.

“Where I still see room for growth is in genuinely authentic storytelling rooted in local culture, rather than simply localizing marketing,” Kazim said.

Saudi Arabia’s tourism landscape is also providing new channels for regional brands. Tamashee is now available at Miraval Resort at the Red Sea, as destination developments combine premium retail with hospitality and lifestyle offerings.

Improved e-commerce, logistics and retail infrastructure have made serving Saudi consumers easier than a decade ago, while employment generated by major projects has broadened purchasing power, Kazim noted.

For international and homegrown brands alike, the opportunity increasingly rests on which can build lasting relevance with a changing Saudi luxury consumer.