NielsenIQ H1 report reveals region’s split shopper preferences

NielsenIQ, the world’s leading consumer intelligence company, has revealed key insights on GCC shoppers for H1 2024.

Despite facing a polarised consumer landscape, the economic picture remains bright in the region, according to NielsenIQ, a leading global consumer intelligence company.

The report sheds light on shopper behaviour, highlighting key trends like brand loyalty in the UAE, value-driven choices in Saudi Arabia and a surge in e-commerce across both regions.

While price remains a significant factor, the NielsenIQ report reveals a strong emphasis on quality across the region. 72 per cent of shoppers in both the UAE and Saudi Arabia are willing to pay more for quality products, a figure that has risen over the past year.

This trend is particularly evident in health and wellness categories, reflecting consumer priorities.

Furthermore, convenience is emerging as a major driver, with 63 per cent and 64 per cent of shoppers in the UAE and Saudi Arabia, respectively, willing to pay more for time-saving solutions.

This trend validates the growing popularity of smaller format stores and e-commerce platforms.

Brand loyalty versus value in focus, reveals NielsenIQ report

The report delves deeper, showcasing distinct consumer preferences in the UAE and the kingdom. UAE shoppers exhibit a stronger loyalty to brands, often seeking promotions on their preferred choices.

Conversely, the Saudi market is driven by mainstream brands that offer a balance between quality and affordability, catering to a broader consumer base with intense promo sensitivity.

The FMCG sector presents a fascinating picture, with contrasting dynamics in both regions.

While beverages, frozen food, and dairy remain staples due to their essential nature and convenience, categories like home care and baby care have experienced a decline, possibly reflecting changing lifestyles and a shift towards online shopping.

In the UAE, an array of affordable and premium brands vie for market share, whereas Saudi Arabia witnesses a stronger focus on mainstream offerings. Interestingly, the HORECA (hotel, restaurant, café) sector has witnessed significant growth in Saudi Arabia, notably coffee and tea shops, indicating evolving consumer habits.

Tech and durables (T&D) see growth

The T&D sector paints a story of growth in both regions, with organised retail remaining dominant. Entry-level and premium segments witnessed growth in both countries, while the middle segment faced challenges as consumers opted for value or aspirational brands.

Saudi Arabia mirrors the UAE’s trend towards premium, while value-oriented players experience significant growth in the UAE.

Notably, the T&D industry exhibits a surge in active brands and products across both countries, showcasing a focus on new market opportunities.

Andrey Dvoychenkov, APP cluster leader at NielsenIQ, summarised the key takeaways: “The UAE’s diverse demographics lead to a polarised FMCG market, where affordability and premium offerings coexist.

“In contrast, Saudi Arabia thrives on mainstream brands catering to a broad consumer base. Importantly, both regions experience rapid expansion in the T&D sector, highlighting a dynamic and competitive landscape.”