Apart from so many other attractions and business opportunities, the UAE has emerged also as a progressive beauty and personal care market in the world. Similar trends are observed in many regions of the MENA but Dubai steals the show.
The cosmopolitan tinge to the UAE, and especially Dubai, and its growing population, impressive literacy rates equally among men and women, and high levels of awareness in health and hygiene explain the growth of the country’s salon and beauty industry. Further boosting the industry are the high incomes levels, rise of social media, and ever-increasing outreach of organized retail and eCommerce.
No prospective market for business has ever been devoid of challenges. Retailers and eCommerce players have their own share of business agonies here. As beauty industry consultants for Dubai and the UAE, we have highlighted four prominent challenges in this blog.
Face Competition or Build a Niche
Dubai is an exclusive and sophisticated market. And when it comes to beauty and personal care, the customer preferences elevate to a form of art. There is no room for ordinary business in Dubai, whether it is products or services. Therefore, understanding consumer behaviour and their needs and priorities in beauty and personal care can be quite fashionably elusive for the Dubai market. It often appears as a big challenge for retail brands. A safer way is to launch products and services that already have a mass demand but that would violate the niche strategy and call for an aggressively competitive stance. Another way is to fill any product or service void in the market identified with elaborate market research and segmentation.
High Dependence on Tourists
Being a tourist destination and business hub, a high proportion of retail customers for beauty and personal care products and services are casual and business travellers. But the problem making a business dependent on tourists is losing touch with the domestic market who can potentially be regular customers. With dependence on the tourist customer base, a lot of effort goes into fancy retailing. Businesses also have to establish tie-ups with airliners, travel agencies, hotels, etc. to start marketing their brand and services earlier in the chain.
Domination of the big brands
The beauty-related product and service landscape is dominated by a selected few established brands. Most buyers are already convinced about the authenticity and quality of the products offered by these brands. Such a situation prevents small players from entering the market as the inclination towards established brands is strong and chances of experimentation from the customers remain low.
The online versus offline battle
Ecommerce came as a big disruption for the traditional brick and mortar retailers in the beauty and personal care market. While online players worked on light inventory models, offline players had to find a get around with limited retail spaces and high rentals. The former also had access to a wider customer base whereas the store-only retailers have to stay confined to their local markets. But in the case of services, the traditional format carries the advantage. These include salon, spa, beauty and massage parlours, etc.
When the problems are identified and well-defined, there is an increased possibility of finding a solution to them. The same is true for business. When the challenges are read in advance, business ideas and concepts can be adjusted accordingly. Where a workaround is not visible, there is always the option of taking ideas and professional help from experienced folks who are in the beauty industry consulting or who are already doing a similar business in Dubai or the UAE.