Consumers in the six-nation Gulf Cooperation Council (GCC) states are changing their shopping preferences in the wake of lockdowns, social distancing and other measures brought on by the ongoing COVID-19 pandemic.
In line with many others in the MIddle-East and elsewhere in the world, consumers in the GCC are increasingly turning online to do their purchases of essential and non-essential items. The change in shoppers preference was revealed in a recent survey by global management consulting firm AT Kearney. More importantly, the survey shows the convenience and health-security aspects of shopping online are likely to entice many shoppers to continue the habit in a post-pandemic world.
The ‘Consumer Sentiment Survey’ conducted by Kearney at the start of the second-quarter of 2020 showed that a significant portion of the public in Saudi Arabia and the UAE — arguably the two largest consumer markets in the region — are not only increasingly shopping online but are expecting to continue their new buying behavior even in the future.
Figures from the survey revealed that in April, at a time when Covid-19 lockdowns and curfews were being stringently imposed throughout the region, around 95 percent of respondents in Saudi Arabia reported shifting to online shopping habits and more than two-thirds said they would maintain their altered habit even when the pandemic subsided.
On a similar vein, 79 percent of respondents in the UAE admitted shifting their shopping preference to online, and nearly half (48%) of those surveyed said they would continue to shop online even after the authorities relax restrictions.
Interestingly, the survey also revealed several differences in shopping preferences among consumers in the two largest GCC markets. While around 60 percent of UAE respondents and 71 percent of Saudi nationals said they spend more on essential products, including groceries, food, healthcare and wellness items, during the pandemic than they did before the emergency situation, the two neighbors differed when it came to visiting brick-and-mortar stores for shopping essentials.
Though consumers in the UAE increased their online spending during the crisis, for both essential (57%) and non-essential (64%) items, visiting a supermarket for essentials was revealed as the preferred method of shopping by 34 percent of poll participants, followed by 27 percent for online, 22 percent for neighbourhood grocery or convenience stores, and 17 percent for hypermarkets.
Unlike the UAE, the most popular purchase channel for essentials among respondents in Saudi Arabia was online with 37 percent choosing this channel. This was followed by supermarkets (24%), hypermarkets (23%), and neighbourhood grocery or convenience stores (16%).
Expenditure on non-essential items also increased during the lockdown in the UAE, with 23 percent spending on education and books, followed by 21 percent on the entertainment category of music and movies. Other non-essential purchases included electronics (17%), home improvement and decoration (15%), fashion and beauty (12%), and toys and games (12%). Online shopping was the most preferred method for purchasing non-essentials for 45 percent of respondents, with almost two thirds (64%) saying they spent more on non-essentials than they did previously.
For Saudi residents adapting to the lockdown, music and movies were the most popular category for non-essential purchases (54%), followed closely by education and books (51%) and toys and games (49%).
When questioned about the criteria for purchasing essential products, 36 percent of UAE respondents highlighted excellent quality and availability as their prime criteria, only 28 percent cited price as the main factor. This highlights that counter to general perception, consumers are not trading down to lower price points due to the pandemic.
However, the most significant finding from the survey was the intent of respondents to maintain their new shopping preferences even after the pandemic restrictions are eventually withdrawn.
Commenting on the survey results, Debashish Mukherjee, Partner and Head, Consumer Industries and Retail Practice at Kearney Middle East said: “Recent developments related to COVID-19 and measures being taken by governments to protect their communities around the world has impacted retail habits, which for the first time we have quantitative evidence to say, will stay in reasonable measure even after this phase is over.
He added, “The survey highlights a growing demand for online shopping, which will undoubtedly shape the future of the industry by both accelerating the growth of online retail and e-commerce ventures.”