London Tops Global Cities For Luxury Retail Store Openings
London had the most new luxury retail store openings in the world in 2016, according to Savills' Global Luxury Retail report. Forty-one new luxury shops opened during the year — 15 of which were the respective brand’s first-ever store in London. Paris had 36 new luxury stores, and New York and Dubai each had 31.
London has consistently been the most visited city in the world by international tourists, according to Savills, making it an important luxury retail market as approximately one-third of this type of spend takes place abroad.
For European luxury brands, London is a useful stepping stone prior to expanding into the U.S., while for U.S. brands it provides a gateway to Europe both geographically and in terms of brand profile.
The World Tourism Organization forecasts that international tourist arrivals globally will double to almost 1.8 billion by 2030, aided by further growth of low-cost air travel and a rapidly expanding and mobile middle class from emerging economies. Europe will remain the largest tourist market with a projected market share of 41% by 2030 and its gateway cities, such as London, will be key target destinations for the increased tourist flow.
Destinations favoured by Chinese nationals, who acquire about 40% of their luxury goods abroad, are highly attractive for luxury retailers. London’s appeal for luxury brands has therefore been enhanced by its rising popularity among Chinese travellers, with visitor numbers increasing 69% in 2015, according to ONS. The evolving future travel patterns of Chinese tourists will also play a major role in determining new and growth luxury retail destinations globally.
The recent weakening in the pound, which has provided an immediate discount for many overseas shoppers, has given luxury spend in London a further boost, Savills said.