In the Emirates, Apple Opens Its First Stores in Arab World

Apple opened its first retail stores in the Arab world on Thursday in the luxury malls of the United Arab Emirates, hoping to sell wealthy consumers on their new high-end smartwatches.

Apple’s two new stores, at Dubai’s Mall of the Emirates and Abu Dhabi’s Yas Mall, find themselves alongside other global luxury brands like Emporio Armani, Fendi and Burberry. And that’s no accident, industry watchers say, as Apple wants to give wealthy consumers hands-on experience with its new Apple Watch line, with some of the high-tech timepieces costing as much as $17,000.

“Apple is trying to position itself, with the watch in particular, as a fashion brand – and a premium fashion brand,” said Daniel Gleeson, a senior analyst at IHS. “It is looking to be part of that company alongside Burberry and Armani. … So moving into that retail slot next to them is not surprising.”

The Apple stores in the Emirates have the sleek, modern look of many of the company’s other 464 retail shops around the world. At the Mall of the Emirates, 60-foot glass panels open up into a showroom with ficus trees and a skylight. The Apple Watch is displayed prominently.

In a nod to cultural norms in the Muslim country, staff will hold women-only workshops with customers, said Wendy Beckman, a senior retail director at Apple. Beckman gave a presentation to journalists at the Dubai store earlier this week and refused to take questions.

Apple Inc., based in Cupertino, California, has focused its attention outside of the Arab world since beginning its retail operations in 2001. Resellers and gray-market stores filled the gap for years, with most new iPhones regularly available from mall kiosks across Dubai soon after their U.S. release, sometimes with U.S. mobile-phone carrier SIM cards still inside them.

In February 2014, Apple CEO Tim Cook visited Dubai and met with its ruler, Sheikh Mohammed bin Rashid Al Maktoum. While specifics of their discussion weren’t released, Cook later visited Dubai Mall, raising speculation that Apple would enter a market already home to high-end retail spaces and deep-pocketed consumers.

Van Baker, an analyst at U.S.-based tech research firm Gartner Inc., said the move into the Emirates made sense for Apple.

“They tend to expand into new markets only when they are prepared to commit sufficient resources to the region to have a real presence,” Baker said. “I suspect that these two stores will be followed shortly by additional stores in the Arab world – assuming the initial two stores are well-received.”

Terms of the Apple Store openings in the Emirates aren’t clear. Typically, foreign companies operating in the country’s seven emirates partner with a local firm. However, there have been reports that Apple negotiated a 100 percent stake in its retail sales.

Apple declined to say whether it had a local partner for its stores. Neither lists any local partner information near the store entrance, common practice for shops in the Emirates. The country’s Economy Ministry and Arab Business Machine Ltd., which describes itself as Apple’s official Mideast reseller, did not respond to requests for comment.