Economic View

On emerging trends in the luxury goods segment and marketing to a global audience

To what extent has the Covid-19 pandemic changed the business environment, and how is Oman helping companies adapt to new realities?

MARCO PARSIEGLA: Since the beginning of the Covid-19 pandemic, we have experienced a new reality in terms of the magnitude and frequency of crises. Building resilience is one of the pillars of success in this environment because it prepares people for the unknown and transforms crises into opportunities to accelerate change. Oman should nurture the talent and skills needed for companies to prepare and adapt rapidly in today’s fluid environment. Oman Vision 2040 sets the stage for this new reality. While it outlines ambitious goals and key performance indicators, it has already generated significant momentum to achieve them. The challenge will be to keep this momentum going.

What are the key consumer trends in luxury markets, and what changes do they require from companies?

PARSIEGLA: Our role in the luxury market is to help clients get noticed by highlighting their unique identities, and storytelling is a useful tool for this. Today’s audience is hungry for authentic stories and wants to engage with brands through conversation. Through this dialogue, consumers seek to identify companies with an artisanal offering that aligns with their values and strive for operational excellence. In perfumes, for example, this means experimenting with the boundaries of what is possible in terms of ingredients.

For Amouage, this has led to less paid advertising in favour of digital content creation and social media engagement. We are also exploring new digital media strategies to promote more interaction and conversation. For example, some of our recent marketing campaigns feature the work of musicians, artists and storytellers. 

While technology offers enormous potential for storytelling, the format needs to be compatible with the specific content a company can and wants to create. As companies experiment with technology, this is a factor they must keep in mind. 

In which ways can luxury brands from the Middle East leverage the region’s capabilities and identity to build their brands?

PARSIEGLA: We compete in a global market for ultra-niche luxury goods valued at $1.2bn. The Omani market represents approximately 20% of our sales. Since entering the international market in 2021, the US and China have been the growth engines for the remaining 80% of our sales. However, being an Omani perfume house is integral to our approach, and something we deliberately chose to emphasise when we designed our current strategy in 2019.

As the only Oman-based international luxury house, the rich history and culture of the country can be a source of inspiration to develop not only the stories around the designs, but also the designs themselves. The perfume traditions of the region drive our selection of quality ingredients, such as frankincense and Omani rock rose. Therefore, in 2019 we made the decision to localise most of our sourcing and ingredient processing in Oman. These activities have been supporting local socio-economic development.

In a sector where around 50% of brands are associated with France, having a Middle Eastern identity is a distinguishing feature. The prominence of family-run enterprises is another of the region’s defining characteristics, and this type of ownership has an important influence on how companies approach their designs and markets.