Majid Al Futtaim, the company specialized in the development and management of shopping malls, integrated cities, retail and entertainment facilities in the Middle East, Africa and Central Asia, today published the first edition of its quarterly report, “The State of the Retail Sector in the UAE”, which reviews key data, trends and insights that monitor behaviors and patterns Consumption and spending habits in the retail trade sector in the UAE, in addition to future expectations for the progress of this sector.
The opening version of the report revealed optimistic indicators about the recovery of the retail sector in the UAE during the remainder of this year, despite the challenges imposed by the global pandemic, the report indicated that the businesses on which the retail sector is based in the UAE have proven their ability to withstand, as it decreased by 12%, compared to about 22% for the rest of the other sectors in the country. The report also highlighted the developmental role that e-commerce platforms have played in enhancing the retail sector’s response to the challenges of the pandemic. Data showing the difference between digital selling transactions and traditional shopping in malls showed that e-commerce in the UAE doubled in 2019, and by February 2021, spending on e-commerce platforms increased by 30% year-on-year. Estimates cited by the report indicate that about a quarter of sales of electronic devices in the country, between 7 and 9% of fashion purchases, and up to 8% of sales of food and household items are now made online.
The report indicates that there are clear indications of a return of optimism to the local consumer market, as the UAE is expected to record the fastest growth rates in the GCC this year. Despite the ongoing effects of the pandemic, the report emphasized that consumer confidence in spending has begun to trend upward. This was confirmed by the data of Majid Al Futtaim, which showed a 17% increase in consumer spending during the period from February to March 2021, and retail sales in its malls showed an increase of 10% on an annual basis in March 2021.
Commenting on the findings of the “State of the Retail Sector in the UAE” report, Alain Bejjani, CEO of Majid Al Futtaim Holding, said, “In 2020, we witnessed rapid shifts in consumption and shopping patterns, and the emergence of an urgent need to find new innovative solutions that benefit from One of the e-commerce tools, in order to keep pace with those changes that occurred in the patterns and behaviors of shoppers in the retail sector.The issuance of this report and the positive results contained therein coincide with the awareness campaigns led by the health authorities in the country to motivate members of society to receive the vaccine, which practically contributes In enhancing feelings of confidence and optimism.The report also provides data that enables the authorities concerned with economic and commercial affairs to take informed economic decisions, which in turn contribute to supporting the country’s economy.According to the report’s data, we are entering a new and optimistic phase, especially with regard to the retail sector in the UAE and its ability to achieve The recovery is fast and at high rates, as indicated by the promising data monitored by the report for the first few months of 2021, which continues to consolidate the positive outlook towards economic recovery, in parallel with everyone’s efforts to prepare for the post-pandemic world.”
With regard to the return of the tourism sector in the UAE, and its close connection with the restoration of shopping activities and the retail sector, tourism spending during the first quarter of 2021 witnessed a remarkable increase in the categories of fashion and accessories by 91%, watches and jewelry by 207%, and electronic devices by 90% compared to With data from the first quarter of 2019. The report indicated that digitization, prudent spending, sustainability and health play a major role in consumer behavior and purchasing patterns. Digital shopping patterns have taken root alongside traditional shopping patterns, giving rise to the term “vegetal age” or “traditional digital” which practically expresses the current shopping patterns of millennials and pre-millennials, whose spending pattern has changed and become wiser and more thrifty. With regard to purchases of necessary daily necessities, with the aim of providing enough savings for the purchase of other products that are planned and suit their tastes and preferences. The data also indicates that the element of “sustainability” has become a major focus of consumers in the UAE, with more than two-thirds of the community and 66% expressing an interest in the environment, and half of them are likely to buy eco-friendly products.
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