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Consumers in the United Arab Emirates (UAE) have the highest percentage of “quality connoisseurs” and the lowest percentage of “cost-conscious” consumers compared to some European countries, according to a new report.
A report by global professional services firm Alvarez & Marsal (A&M) in partnership with Retail Economics shows that UAE consumers are less likely to sacrifice product quality to lower prices and are more inclined to sacrifice convenience or shopping experience.
In general, emotionally driven value attributes (sustainability and experience) are considered to be the most important across all retail categories for UAE consumers. 12% of consumers in the UAE are increasingly embracing social causes and are shopping intentionally by finding products and brands that align with their values; 12% are looking for meaningful interactions with retail brands, entertainment and when purchasing An environment that adds value to the overall experience.
Quality is the most important
In the UAE, 42% of consumers cite quality as the most important value when purchasing a product, which may reflect the country’s higher average income. However, nearly a third of consumers in the UAE (29%) say the cost of living crisis will have the biggest impact on their expectations of retailers and brands over the next 12 months.
24% of UAE consumers believe price is an important factor in decision making; these consumers are expected to switch to private label and private label products, and even from supermarkets to discount store operators.
For the study, Retail Economics conducted a nationally representative panel of consumers in seven countries including the UK, Spain, Italy, France, Germany, Switzerland and the UAE. The sample included more than 5,250 consumers and survey data was collected in April 2022, a statement said.
James Dervin, Managing Director of Alvarez & Marsal Middle East, said: “Our analysis shows that UAE consumers currently have different priorities compared to most of their European counterparts. In our survey, the UAE showed the highest percentage” Connoisseurs of Quality,” while also focusing heavily on customer experience and a consistent bias toward emotion-driven value attributes.
wealthy population
“Price appears to be a relatively low priority factor in decision-making and this is expected to change over the next 12 months. We believe this reflects a relatively affluent consumer base and current economic pressures compared to European counterparts and the relatively prominent role of retail as a leisure and community activity in the UAE and the region as a whole,” Devin said.
“Evolving consumer preferences and emerging trends such as seamless retail channels, personalisation, evolving operating models, digitalisation and flexible supply chain models are likely to further shape the UAE’s retail landscape with possible long-term implications. Identify emerging trends And being proactive and flexible can help retailers develop winning strategies for the next decade.”
Societal values related to the impact of consumption on the environment are rapidly gaining attention as consumers, businesses and governments increasingly focus on carbon reduction strategies. As such, this shift makes it critical for retailers, consumer brands and suppliers to commit to environmentally friendly operations and ethical practices. The pandemic has affected shoppers’ perceptions of sustainability, with nearly 8 percent of UAE consumers saying they now think more about the environmental impact of their purchases, the report said.
For UAE consumers, the most important ethical practice is knowing that a company or brand uses sustainable ways to source its products and materials (21%), followed by fair wages for employees (21%).
Across the five countries surveyed, it’s worth noting that younger consumers are most likely to prioritize sustainability and ethics, with 12% saying it’s the most important factor in making a purchasing decision – compared to , with an average of 9% across all generations. In the UAE, nearly half of consumers (49%) say they are willing to pay more for sustainable products (a significant increase of 15% and a slightly higher 34%). Ethics and sustainability are the most important factors for consumers when buying groceries (16%) and apparel (15.5%), although they are still seen as less important for product quality and price.
Erin Brookes, Managing Director and Head of European Retail at A&M, said: “While price and quality are key factors in making purchasing decisions, consumer expectations for retailers to act in an ethical and sustainable manner continue to grow. Investing continuously, but innovations in the industry, such as upcycling or the Old Love series, show that ethics and sustainability can also create business opportunities.” – Arab Trade News Service
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