Tourists from the Middle East have been big spenders in UK retail for a few years now, but July’s year-on-year rise of 104% is large even by their standards. What do Middle East shoppers like so much about the UK, and how can retailers make the most of this?
The latest figures from foreign shopping consultancy Global Blue show tax-free shopping by Middle Eastern visitors rose 104% year on year in July – the largest in a long run of recent increases.
Much of this increase can be explained by the timing of Ramadan this year. The festival, which changes date every year, started on July 20 and will end on August 18. It’s likely that Middle Eastern consumers took their holidays and did their shopping before it started, meaning much of July and August’s spending will have been condensed into the first half of July.
But the longer term trend is undeniable. UK brands are popular with wealthy Middle Eastern tourists, and average spend is rising. “It’s fair to say Middle East shoppers are spending more,” says Richard Brown, UK vice president at Global Blue. “The increase is not driven by the number of tourists increasing, but average spend per person seems to be going up really well.”
While August will see a dip in Middle Eastern tourist spending, it is likely to pick up again with Eid, the festival which marks the end of Ramadan. Brown says that while Middle East shoppers are undoubtedly fans of luxury brands such as Burberry, all kinds of UK retailers are likely to benefit – any big name on Oxford Street is as likely to attract spend as the high-end names.
A range of customers come over to the UK from the region. 80% of travellers from the United Arab Emirates, for instance, are aged between 25 and 54, so it’s not just the older generation who can afford big shopping trips.
The UK is popular because there are lots of direct flights to the region, the summer climate is less intense than the Middle Eastern heat, and because London has an unrivalled retail offer. To take advantage of this, Brown says retailers simply need to keep Middle Eastern shoppers in mind when devising customer service strategies. “Some retailers make sure they have dedicated customer assistance for Middle Eastern shoppers, some have prayer rooms, and it’s important to have Arabic-speaking staff.”
While around 40% of Arab visitors come to see family and friends living in the UK, most of the spending is focused on London and other areas of the country don’t benefit as much from the trend.