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consumers in Saudi Arabia and the United Arab Emirates worried about rising inflation and global market volatility, but they Spending power remains strong Heading into 2023, a survey found.
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The survey, conducted by Kearney Middle East, found that 80% of Saudi residents and 90% of UAE residents expressed concern about these macroeconomic challenges. While prices have increased across most retail categories, 16% of UAE consumers and 11% of Saudi consumers reported spending has increased since 2021.
Despite concerns, the management consultancy revealed in its findings on Tuesday that consumer buying power is not expected to decline over the next six months.
“The Kingdom’s progress over the past five years has contributed significantly to further strengthening its economic fundamentals. Regardless of the macroeconomic environment, businesses and individuals have benefited from favorable policy changes that have given consumers confidence in their purchasing power,” Coe Debashish Mukherjee, partner at Erni Middle East, said in a statement on Tuesday.
“This was further reinforced by the fact that Saudi Arabia spent more on discretionary items compared to 2021, a trend we expect to continue into the new year,” he added.
Online Shopping
Online shopping remains a popular channel for shoppers in Saudi Arabia, mainly due to ease of purchase (74%), saving money (58%), wide variety (51%) and ease of delivery (49%).
“Many retailers have had to adapt their strategies over the past three years to meet the challenges posed by the pandemic. We are seeing more and more adopting an omni-channel approach to ensure business impact is cushioned,” said Mohammed Dhedhi, Partner, Kearney Middle East added.
“Consumers are also increasingly shopping online, forcing retailers to come up with new ways to build stronger brand connections and deliver more engaging in-store experiences.”
Commenting on the situation in the UAE, Mukherjee said that regardless of the macroeconomic environment, the country’s overall “strong economic fundamentals and continued favorable policy changes for businesses and individuals give consumers confidence in their purchasing power.”
Online shopping remains a popular channel United Arab Emirates Shoppers for ease of buying (66%), saving money (62%), great variety (51%) and ease of delivery (48%).
“With online shopping also growing steadily, retailers [in the UAE] Now more than ever, there is a need to build stronger brand connections and deliver new, more engaging in-store experiences,” Dhedhi added.
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