Out of 2,200 shoppers surveyed in Saudi Arabia and the UAE, more than half are cutting back on their spending, according to a report released this week by management consulting firm McKinsey.
The need to economise is primarily driven by soaring global inflation and the rising costs of essential items.
Reduced prices and bargain sales online are also helping shoppers to spend less.
All of these factors have led to the emergence of more “price sensitive, digitally savvy and socially responsible” shoppers, according to The Middle East Consumer Sentiment Survey.
The number of Middle East customers who turn to online shopping has grown twofold in the past two years. Forty-two per cent of people surveyed reported receiving online deliveries for groceries, clothes, household items and electronic items at least once a week.
The report showed that Saudi shoppers reported a sharp decline in brand loyalty, as more than 50 per cent of respondents sought more affordable options.
Growing economic uncertainty, job insecurity and the lingering impact of Covid-19 were cited as primary reasons for saving money.
Respondents said they had to rein in their spending to remain on top of their financial situations.
Amazon-style online marketplaces also generally offered better deals when compared with conventional supermarkets, shoppers said.
“Incumbent retailers are competing with a growing number of digital market entrants, including super apps, social media players, aggregators and global e-marketplaces,” the report said.
This trend is projected to accelerate in the next few years, as the UAE retail mobile-commerce market is expected to grow by 19 per cent by 2025.
In July, a YouGov survey found that up to 83 per cent of UAE residents reported their cost of living shot up to some extent compared to last year, with more than 53 per cent saying it has increased substantially.
