While 58 percent of the region’s consumers have become more optimistic about the economy, their behaviour is still impacted by coronavirus as they have become more digital, price sensitive and health conscious over the past year, the recent PwC 2021 Global Consumer Insights survey revealed.
Close to 67 percent of regional consumers believe they have become more digital during the pandemic, while in Egypt that number increases to 72 percent, compared to 51 percent of global consumers.
“Digitalisation and sustainability are firmly at the top of consumers’ agendas. To prepare for the future, retailers across the region will need to be fast and agile to capture business from a rising generation of youthful, socially aware consumers who are digitally savvy,” said Norma Taki, consumer markets leader and transaction services partner, PwC Middle East.
Despite this increase in e-commerce, 56 percent of Middle East consumers still prefer visiting physical stores (compared to 45 percent globally) even as health and safety continues to be a concern. Among the safety measures that regional consumers highlighted are mandatory face masks (44 percent), social distancing (43 percent) and hand sanitisation stations (32 percent).
The survey also indicated that mobile is now the dominant e-commerce channel with 47 percent of regional respondents saying they use their smartphones most frequently for purchases, compared with 39 percent of global respondents.
The economic challenges brought on by the pandemic continue to weigh on Middle East consumers as 57 percent of them revealed they have been more price-oriented during the pandemic and 66 percent said they have been focused on saving.
“Before the pandemic, our Middle East findings from the 2020 Global Consumer Insights Survey indicated that consumers were more optimistic about their personal spend than their global peers ‒ 63 percent in the Middle East expected to spend more versus 46 percent of global consumers,” Taki told Arabian Business.
“Our Covid-19 Pulse survey, conducted in May 2020, showed that 62 percent of Middle East survey respondents said they had experienced a decrease in household income due to redundancy or reduction in working hours, the highest proportion of any territory surveyed. Subsequently, it’s not surprising that regional consumers are still more cautious about their spending,” she continued.
Norma Taki, consumer markets leader and transaction services partner, PwC Middle East.
This price sensitivity was reflected in the success of off-price retailers such as Brands for Less, whose founding partner and CEO Toufic Kreidieh told Arabian Business in April that “we really grow when there is a crisis taking place and this was the case during Covid-19 where we were able to grab very good opportunities in different places”.
The region’s consumers have also become more health conscious as a result of the pandemic and 71 percent indicated they’ve become healthier over the last 18 months or so. When shopping for groceries, 41 percent of respondents said they are willing to pay more for healthier options.
During the pandemic, suppliers of organic produce in the UAE saw delivery sales spike as much as 300 to 400 percent, according to industry insiders Arabian Business talked to.
Approximately 65 percent of regional consumers reported they have become more eco-friendly during the pandemic as it reinforced the growing awareness of social and environmental sustainability. Close to 75 percent of Middle East consumers indicated they buy from companies that are environmentally conscious (compared with 54 percent globally) and 72 percent said they choose products with a traceable and transparent origin.
“Covid-19 has generally raised awareness of societal and environmental issues and opened up a debate about what companies are doing to support these issues (internally within their organisation, externally with their stakeholders as well as giving back to their communities). Sustainability is a big part of this conversation with more and more consumers looking to brands they consume to be responsible,” said Taki.
“With the pandemic disrupting supply chains, there has been a shift to consuming more locally produced products that will continue to be available despite lockdowns or restrictions,” she added.
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