Strong consumer spending and evolving retail landscapes fuel economic resilience in the Gulf

UAE market is fragmented between affordable and premium brands, while KSA market is skewed towards mainstream brands with the value players picking up
UAE/KSA: The Middle East continues to distinguish itself as a global economic outperformer, with the United Arab Emirates and Saudi Arabia leading the charge. While global GDP growth is projected at 3.2% in 2025, the UAE is expected to grow by 4.0% and Saudi Arabia by 3.0%, with further acceleration anticipated through 2027. Consumers across these regions continue to demonstrate strong resilience amid ongoing challenges.
This robust performance is underpinned by strategic international partnerships, balancing ties with both BRICS and Western economies, alongside targeted investments in digital transformation and a young, digitally connected population.
Consumer Markets Show Resilience Amid Economic Transition
Consumer spending remains strong across both markets, though increasingly value-driven. In the UAE, spending on Tech & Durables (T&D) from April 2024 to March 2025 reached $5.3 billion, marking a 2% year-over-year increase. Key growth categories include Smartphones, Media Tablets, Vacuum Cleaners, and Headsets.
The Fast-Moving Consumer Goods (FMCG) sector in the UAE also saw a 7% increase, driven by rising demand for Snacking, Beverages, Dairy, and Frozen Foods, with Personal Care spending up 6%.
In Saudi Arabia, growth was more moderate but steady: FMCG rose by 3.3%, and T&D by 0.2%. Notable category gains include Petcare (+10%) and Snacking (+9%), reflecting evolving lifestyle priorities, while Paper Products and Home Care saw declines.
Retail Channels Evolve: Value and E-Commerce Gain Ground
Retail dynamics are shifting rapidly. In the UAE, Traditional Trade Channels outpaced Organised Retail, with FMCG growth of 10% versus 3.2%, while T&D saw balanced growth across both.
E-commerce continues to expand its footprint. In the UAE, it now accounts for 30% of T&D and 11% of FMCG sales, up from 9% a year ago. In Saudi Arabia, online sales are also rising, with a 7.7% increase in T&D and a 1.4 percentage point gain in FMCG e-commerce share.
'The economic momentum we're witnessing across the Middle East, particularly in the UAE and Saudi Arabia, is a testament to the region's strategic vision and adaptability,' says Andrey Dvoychenkov, General Manager, NielsenIQ APP.
'Consumers today are more empowered, informed, and value-driven than ever before. We're seeing strong growth in both premium and value segments, and a rapid evolution in retail channels—especially online. For brands, success hinges on relevance, agility, and a deep understanding of consumer expectations.'
Brand Competition Intensifies in a Crowded Marketplace
The region's economic promise is attracting a surge of global brands. In the FMCG sector, Saudi Arabia now hosts over 10.500 active brands (up 5% YoY), while the UAE features 13,000 brands (up 6%). SKU counts are also rising, with 130,000 SKUs in the UAE and nearly 100,000 in Saudi Arabia.
The T&D sector is similarly competitive; the number of active brands has seen great increase with 18% and 21% respectively in UAE and KSA. SKUs have also seen more than 50% growth across both markets. This creates a vibrant but crowded landscape, requiring sharper brand strategies and deeper consumer insights.
Premium vs. Value: The Rise of the Strategic Shopper
Middle Eastern consumers are increasingly discerning, balancing premium aspirations with value-driven choices. Both the UAE and Saudi Arabia recorded double-digit growth in premium and value FMCG segments, highlighting a bifurcated market.
In T&D, value segments grew 6% in KSA and 3% in the UAE, despite the category's premium lean. This underscores two key trends: the rise of price-conscious decision-making and the growing availability of competitive alternatives.
As the Middle East continues its upward trajectory, global brands are positioning themselves to seize the opportunity. But success will depend on a nuanced understanding of the region's evolving consumer landscape—from digital trust and pricing sensitivity to channel dynamics and assortment strategy.
About NielsenIQ
NIQ is a leading consumer intelligence company, delivering the most complete understanding of consumer buying behavior and revealing new pathways to growth. NIQ combined with GfK in 2023, bringing together two industry leaders with unparalleled global reach. Our global reach spans over 90 countries covering approximately 85% of the world's population and more than $ 7.2 trillion in global consumer spend. With a holistic retail read and the most comprehensive consumer insights—delivered with advanced analytics through state-of-the-art platforms—NIQ delivers the Full View™. For more information, please visit www.niq.com

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