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Consumer preferences are changing in the Gulf region. How are they different?

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Growth in Gulf retail

In the news

•

Smartphone shopping. Shoppers in the UAE lead the world in their preference for mobile commerce, buoyed by the high quality and speed of internet in the region. According to a new study, more than 70% of brick-and-mortar shoppers say they are likely to use their smartphones to compare prices or look up product information online before making an in-store purchase. To capitalize on this trend, merchants are doubling down on their digitization initiatives, including creating digital profiles for shoppers. [Khaleej Times]

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Black Friday reaches the Gulf. The busiest shopping day in the year in the US is receiving heightened interest from overseas shoppers, particularly in Egypt, Saudia Arabia, and the UAE. Online shoppers in the region conducted some of the highest online searches for Black Friday deals compared with Brazil, the UK, and the US, according to an Ipsos study that was commissioned by Google. More than half of Gulf consumers start researching products online before the sale season starts, the study found. [Arabian Business]

Our survey shows the number of people in the UAE and Saudi Arabia who shop online on a weekly basis has doubled in two years.

On McKinsey.com

•

The new Gulf consumer. In the face of the COVID-19 pandemic, a new Gulf consumer is emerging, one with shifting financial sentiments and spending habits, find McKinsey partner Abdellah Iftahy and coauthors. According to our latest Middle East Consumer Sentiment Survey, UAE and Kingdom of Saudia Arabia shoppers are becoming more price sensitive. Twenty-seven percent of UAE respondents earning less than 7,000 dirhams ($1,905) a year reported a preference for trading down in 2021, up from 13% a year earlier. The phenomenal growth in e-commerce usage in the region is also helping consumers compare prices and deals online.

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Two critical areas. These behavioral shifts present a unique opportunity—as well as an urgent need—for Gulf omnichannel retailers and consumer-packaged-goods manufacturers to rethink their consumer strategy. This change won’t come easy. Before the COVID-19 pandemic, Gulf retailers underinvested in advertising and marketing. But rapid digitization and a growing competitive pool of digital attackers are forcing companies to devise new ways to attract and retain their customer base. See two priority areas that could drive revenue growth for consumer companies in the Gulf region.

Two areas for propelling growth

— Edited by Arshiya Khullar, editor, Gurugram

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by "McKinsey On Point" <publishing@email.mckinsey.com> - 12:38 - 1 Dec 2022

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Consumer preferences are changing in the Gulf region. How are they different?

Growth in Gulf retail

In the news

Our survey shows the number of people in the UAE and Saudi Arabia who shop online on a weekly basis has doubled in two years.

On McKinsey.com