Apple Pay and the competing version from Samsung are not the only payment platforms that UAE retailers need to link up with alongside a Visa or a MasterCard. These days, they will do well to have any of the payment options from China available. And especially, for the luxury retailers among them.
“What we are finding is that associations with Chinese institutions such as Union Pay have helped influence traffic to our stores from the high disposable income category,” said Greig Fowler, CEO of AW Rostamani Lifestyle. “Getting the attention of overseas visitor, especially those from East Asia, has to begin well before they have even landed.
“What we managed to do during the peak December-January period was able to offer redeemable loyalty points and rewards from the banks for shopping and using the Union Pay card.”
Other luxury-focused retailers are doubling down on their payment options for the wealthy Chinese buyer. The Al Tayer Group’s retail arm, Insignia, confirmed that select stores within its network started accepting Alipay (a digital payment method from Alibaba Group) from this month. In fact, the retailer became the first in the UAE to roll out Alipay options. It will be extended to the other stores shortly.
Creating capabilities that can tap the Chinese visitor interest had clearly gone way beyond having Mandarin speakers at the shops and boutiques. Or putting up prices in Chinese. These days, having in place the latest in online (and offline) payment methods they are familiar with is part of the deal. The China buyer push is already quite evident in Dubai’s real estate market.
The local luxury retail sector had been through an exceptionally difficult phase for two years now, and with some sources suggesting a decline over and above what the wider retail sector felt.
But glimmers of hope are filtering through, if the mid-December to mid-January run is any indication. “Actually, 2017 finished strong across the luxury sector,” said Fowler. “There was a definite push for sales before the implementation of VAT, even for big-ticket items.
“There was a mindset of trying to do the buying ahead of the tax, so much so it actually created almost a frenzy across the sector in December, particularly from mid to the end of the month. And some of spilled over into the New Year period and until mid-January.
“But the latter stages of the Shopping Festival were much slower than in previous years. What the market is seeing is a change in the dynamic of the tourist arrivals this years — there is a huge increase in the East Asian community, who were still spending relatively well. The Chinese has been very important to us through December and January.
“Tie-ins with the likes of Union Pay is about creating a solid database of customers that you can go back and work on throughout the year. It’s about getting those repeat customers year after year. On an effort-to-reward basis, this will definitely yield positives. That’s what this is all about.”
AW Rostamani Lifestyle is still working on the portfolio of brands it represents. It operates multiple outlets at The Dubai Mall, and where it recently opened a boutique for the Danish lifestyle and accessories brand Georg Jensen. It holds the rights for the Gulf territory; there are no commitments for Lebanon or Jordan for the moment. This could be taken up at a later date, according to the CEO.
Apart from the GCC-wide rights, it is also keen to pick up that for a brand’s eCommerce presence. “Like many, I believe the combativeness between eCommerce and brick-and-mortar will slowly dissolve,” said Fowler. “There is Amazon opening stores and same is the case with Alibaba. More retailers will start thinking of these — eCommerce and physical stores — as the two engines to build a business. You can’t have one at the expense of the other.
“In the luxury market, there are some who would not want to enter mall. but select online and service the transaction from home. Retailers need to give these buyers the comfort of doing it in their own environment.
“They expect to get what they want not when they want it. For retailers, what matters is how we can continue to use the CRM database to find repeat customers. The eCommerce platform will address that.”
