Fashion Retail thrives in UAE While the World Rethinks It
By Alhanouf Mohammed Alrowaili
In the UAE, the future doesn’t just arrive; it’s curated, color-coded, and couture-clad. Amid shifting sands and skyscraper shadows, the retail sector, particularly fashion and luxury, is not only alive but elegantly evolving. Welcome to 2025, where luxury isn’t just a label; it’s the language of identity, and the UAE is its most fluent speaker.
Retail’s Resilience: Numbers, Not Narratives
According to the Dubai Chamber of Commerce, the UAE’s total retail market reached AED 308 billion ($83.9 billion) in 2025, with fashion, beauty, and luxury accounting for nearly 34% of that spend. The sector is growing at 6.2% CAGR, fueled by tourism, Gen Z consumerism, and experiential retail.
“Retail in the Emirates is not a categoryit’s a culture,” says Nisreen Shocair, President of Fashion at Chalhoub Group.
“It reflects who we are, what we value, and how we want to be seen by the world.”
Dubai: The Runway of the Region
With over 19 million visitors expected in 2025, Dubai remains the global capital of experiential shopping. Retail contributes 12% of Dubai’s GDP, according to Dubai’s Department of Economy and Tourism. And it’s not just quantity; it’s also quality. From Level Shoes and THAT Concept Store to Fashion Avenue in Dubai Mall, the city curates a theatrical blend of global glamour and Gulf-specific storytelling. Hermès, Chanel, Cartier, and Valentino are not merely tenantsthey are narrators in the Emirates’ retail mythology.
Luxury Reimagined: Modesty, Legacy & Data
Luxury in the UAE has undergone a transformation from exclusivity to expression. The 2025 Chalhoub Luxury Insights Report reveals:
- 68% of Emirati luxury consumers now prioritize cultural relevance in collections.
- 73% of Gen Z shoppers expect digital integration with their luxury experiences (AR fitting, NFT certification, etc.)
“Fashion here is less about Western aspiration, more about Arab authorship,” notes Dina Al Herais, Regional Director of Marketing at Dior Middle East.
“We’re seeing a renaissance of modestwearnot as compromise, but as couture.”
Valentino’s Ramadan Kaftan Salon sold out in two weeks. Gucci’s Middle East-exclusive ‘Noor’ line saw 4x engagement compared to global drops. Dior’s flagship in Dubai has added a “Maison Majlis,” a private showroom inspired by Emirati hospitality.
Homegrown Power: From Trend to Testament
While the global names headline, Emirati and Arab designers are driving emotional loyalty, brands like The Giving Movement, Bouguessa, and Anatomi are blending sustainability, spirituality, and sophistication in ways that resonate. The Giving Movement hit $25M+ in annual revenue this year and expanded to KSA and UK. Three Arab celebrities wore Bouguessa’s SS25 collection at the Cannes Red Carpet. Farfetch and Ounass both report double-digit growth in demand for regional labels.
The Rise of ‘Phygital’ and Smart Luxury
Step into Mall of the Emirates and you might meet your AI stylist. Browse Dior, and receive a digital NFT of the design history. Order from Bloomingdale’s and track the ethical sourcing in real-time.
“Customers today want to shop a story, not just a product,” says Patrick Chalhoub, CEO of Chalhoub Group.
“The smart luxury experience is now about transparency, personalisation, and heritagedelivered through tech.”
The Group has rolled out AI-powered inventory tools, blockchain-based authenticity tracking, and AR-enhanced virtual concierge apps across flagship stores.
Tourism & Retail: A Love Affair Continues
Dubai’s strategy to align high-end tourism with luxury retail is paying dividends. According to Dubai Economy & Tourism:
- In 2025, 40% of luxury spending is expected to come from international visitors.
- Tourists from China, India, Russia, and Nigeria show the highest per capita luxury consumption.
- Events like Dubai Fashion Week, Arab Fashion Council’s Modest Summit, and Emirates Gold Card Retail Access programs are turning shopping into a pilgrimage.
Urban Vision: Retail as Citymaking
With the Dubai 2040 Master Plan well underway, the future of shopping won’t be confined to malls. Mixed-use zones, cultural retail districts, and pop-up lifestyle hubs are becoming increasingly central to how Emiratis interact with their surroundings. The upcoming Al Khawaneej Fashion Park is expected to be a first-of-its-kind luxury + wellness + community retail experience designed around Emirati values and aesthetics.
A Retail Renaissance, Rooted in Identity
As Western markets question the future of brick-and-mortar and fight return rates, the UAE is asking a different question:
“How can retail reflect who we are becoming?”
And that’s why it’s working. In 2025, fashion and luxury in the UAE are not simply about what you wear, but about what you mean, what you preserve, and what you project. In the Emirates, fashion is more than fabric’s the architecture of ambition.