“Nearly two-thirds (59%) of luxury spenders in the MENA region are now choosing to spend more of their money on enriching experiences rather than goods,” according to the new American Express Middle East Spending Survey.
This is markedly different from the results of a similar survey carried out by American Express Middle East in 2012 which showed respondents opted to spend their disposable income on tangible assets such as high-end fashion, accessorizing themselves and the latest cars.
The American Express Middle East Spending Survey was conducted by YouGov across the MENA region. Looking specifically at Bahrain, 77% of respondents say they prioritise spending on luxury experiences, compared to just 23% that prioritise spending on luxury goods. This compares to a regional average of 42% and a GCC average of 40% who prioritise luxury experiences, making Bahrain second only to Jordan in MENA and the leader in GCC. With experiences including activities such as holidays, hobbies, sports and dining out, Bahraini’s cite personal well-being and relaxation as the top reasons why they spend on luxury experiences.
In Bahrain, the vast majority of respondents choose to spend their money on holiday experiences over almost other luxury products or activities. 80% rank holidays their number one luxury spending priority, almost double the regional average of 43%. It also contrasts with the picture of the region as a whole where social events such sporting activities tend to attract most spending. When it comes to other experiences, Bahraini’s rank spending on hobbies as their second most important spending category and, as befits an island nation, sporting activities such as water sports ranked third. When it comes to buying goods, 17% of Bahrain’s residents rank fashion and designer-wear as their number one category for buying goods compared to the regional average of 29%, tending to prefer to spend on categories such as high end electronic goods and cars.
“Over recent years, we’ve seen a major shift in the way people spend and make luxury purchases and investments. Increasingly they are focusing on buying experiences, and the memories that go with them. Nowhere is that more true than here in Bahrain. Our survey shows Bahrainis have a single-minded emphasis on holidays, cutting their expenditure elsewhere so they can enjoy time away from their day-to-day lives,” Mazin Khoury, CEO, American Express Middle East, said.
The American Express Spending Survey contains good news for hoteliers, airlines and even retailers with spending on luxury experiences and goods set to grow in the next 12 months. In Bahrain, 33% of respondents expect to spend more on luxury goods in the coming months and just 7% of respondents say they are likely to reduce spending in 2015. This compares very favourably to a regional average of 13% planning to spend less.
“Our Survey is definitely good news for the merchants with which we work closely in Bahrain,” Khoury, added.
“The rest of 2014 and 2015 are likely to show increased spending on both luxury services and goods. This supports the trends we’ve seen through the first half of 2014 which shows a significant increase in Cardmember spending.”