BrazilUAE and KSA consumers re-purposing their spending habits
Consumers in Saudi Arabia and the UAE are re-purposing their spending habits in response to the current economic climate, although they remain notably more upbeat than their global peers on the outlook of the economy and their personal finances. That is according to a consumer survey from market research consultancy Toluna.
The study, spanning 19 markets worldwide, indicates that Saudi Arabian and UAE consumers are substantially more optimistic about the future than the global average. Just over 7 out of 10 (71%) of KSA consumers expressed optimism about the future, as compared with the global average of 43%. In the UAE, consumer sentiment is also strong, with 64% expressing optimism.
Proactive financial planning
In the domain of financial planning, residents in the KSA and the UAE are proactively employing strategies to navigate economic uncertainties. Approximately 30% of respondents said they would cut spending on books and magazines, noting the wealth of online resources available.
Similarly, 28% of KSA residents and 30% of UAE residents are dedicated to decreasing expenditures on luxury products or services. This percentage is notably lower than the global average of 42%. Perhaps also indicative of higher inflation, 40% of respondents said they foresee spending more on utility bills.
Cost-of-living challenge continues to impact people's lifestyles, savings, and spending habits worldwide, as well as in the region. The financial strain is not only affecting significant purchases such as cars but is also trickling down to more modest indulgences, like dining out.
Guiding grocery shopping behavior
In anticipation of future grocery shopping behavior in the next three months, the study sheds light on the preferences of KSA and UAE consumers. A desire for healthy eating is regarded a primary motivator, closely followed by considerations of price, brands, and quality.
45% of shoppers in KSA and 47% in the UAE plan to reduce unnecessary purchases. That is compared to 51% in the global dataset. Another strategy some take is to shop more frequently to cut down on waste and secure better deals.
Energy prices and inflation
A significant majority of consumers in KSA and UAE told Toluna that their current spending plans are influenced by the energy crisis and inflation. Inflation has emerged as a predominant concern among these consumers.
Many respondents also expressed concerns about global market instability and housing prices, with more than half of both KSA and UAE emphasizing the growing cost of living. Some 45% of Middle Eastern consumers said they were actively trying to save more money in response to economic uncertainty.
Anticipated spending behavior
Nearly 4 in 10 residents in Saudi Arabia and the UAE said they planned to spend less on drinking outside the home and ordering takeaway meals in the next few months. Indeed, perhaps more are looking to cook at home, with 40% saying they would spend more on groceries.
All major Middle Eastern cities included in a recent index saw the cost of living increase significantly in the last year. Some of the most costly cities to live in include Dubai, Tel Aviv, and major Saudi cities like Riyadh and Jeddah.
