The Ramadan retail sales in the Middle East and North Africa (MENA) region is set to hit $66 billion this year – a five percent rise from last year – despite the inflation worries and lack of discount offers on some of the high-demand products, the latest market study said.
A major surprise of this year’s Ramadan shopping season, however, will be the print media advertisements staging a strong comeback as the main influencer for customer purchase decisions, with a projected 200 percent surge in the UAE and Saudi Arabia from its last year’s share.
Fashion, dine out and food delivery, travel and home décor are projected to see higher sales this season, while sales of home furniture, grocery and luxury products are expected to shrink, the market study by RedSeer, a global consultancy specialising in digital sectors, said.
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Automotive, beauty, real estate and electronics sectors are expected to maintain their last year’s sales volumes, it said.
“A surge in new product purchases, gift items and dining out activities are expected this season due to a rise in planned purchases, social get-togethers and gifting activities,” RedSeer said.
A significant decline in home cooking this time – by as much as 50 percent – is expected to lead to a slump in grocery sales this season.
RedSeer also said this year, shopping excitement around Ramadan in Saudi Arabia is expected to be lower as per their survey, as customers see that many of their favorite products do not have any special offers during the season.
Ramadan 2023 trends
“This [year’s] Ramadan will be different. People will cook less at home and go out more to meet people. They also plan to gift more, albeit smaller gifts,” Akshay Jayaprakasan, Associate Partner at RedSeer Strategy Consultants, told Arabian Business.
“There’s also a strong willingness to try out new brands and products. Essentials, fashion, gifting, home decor, food services are segments that will see a rise in sales,” he said.
RedSeer said new product categories are expected to hog the limelight this Ramadan season, with three-fourth of the consumers surveyed saying they are open to try new products during the season.
“Hence, this will be an opportune time for brands to launch new products,” it said, adding that this will offer a major opportunity for D2C players.
Planned purchases will become prominent, with a 14 percent rise this year’s season from 2022, the study said.
“Unlocking discovery opportunities will be key to drive sales,” it said.
Social get together and gifting are two activities which are expected to see the highest growth this year, with a surge of 33 percent and 44 percent respectively.
“This will help the hospitality and the gift retailers, while offering a major opportunity for a revenue surge for quick commerce players in the region,” the study said.
Product discovery modes
Product discoveries by consumers are expected to see a major shift this year, with print media advertisements projected to register a comeback this year, with a two-time growth in percentage terms from the last year.
“As for product discovery modes, the print media will be the biggest beneficiary this year, projected to see a 200 percent jump in influencing customer purchase decisions in both the UAE and Saudi Arabia,” RedSeer said.
Online searches are projected to see a slump of 23 percent this season, while community channels and brand apps are expected to see a marginal growth of 5 percent and two percent respectively this time around, the study said.
While popular social media platforms such as Twitter, Facebook, Instagram, YouTube and SnapChat are projected to see a decline of 11 to 6 percent from their 2022 share in product discovery, TikTok is expected to see a marginal rise of three percent this year, RedSeer said.
The study also said the preference for social commerce for product purchases this year will be high, with 1 in 4 consumers open to purchasing products through digital media platforms.
“This calls for sector players to optimise their social commerce experience by removing challenges in converting hesitant users,” RedSeer said.
The study also revealed that deals and promotions and fast delivery modes will be the major factors for UAE consumers for purchase of new products, while free shipping offers will be the major attraction for Saudi customers to try out new products this season.
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