Discounts alone won’t make UAE shoppers splurge
MAJORITY ARE CAUTIOUS WHEN IT COMES TO BUYING NON-GROCERY ITEMS
UAE retailers will need to go the extra mile with their Ramadan promotions to get shoppers interested, a majority of whom are still extremely cautious on how they spend.
Sure, there will be categories such as groceries that will see increased spending during the Ramadan month, but other categories such as fashion, accessories and auto have work to do. “Price cuts are not always the best promo mechanism that shoppers respond to,” said Didem Sekerel Erdogan, Senior Vice-President — Intelligent Analytics at NielsenIQ, the market research firm.
Try and convince
This time around, a year after the pandemic, 98 per cent of UAE consumers remain “constrained and cautiously insulated”, which is how NielsenIQ describes the current mindset.
Plus, for a lot of consumers, they would have done their non-essential spending in December/early
January, or they could be saving up for a staycation or a short holiday trip during the Eid break.
And as is the case with each promotional cycle, online will have its own promotions, with some of them making changes to their offers in real-time.
So, what would it take to get UAE consumers buying, or at least checking out the offers? “Promotions that work differ across countries and also across categories,” said Erdogan. “There is no magic one-sizefits-all formula that works.
“Shoppers in UAE like bulk offers and special packs, while Saudi shoppers respond to price discounts.”
Some catching up
Even for consumer goods brands, this Ramadan will mean a chance for some catching up. Typically, the Ramadan weeks are among the best phases for these labels, but 2020 was an exception.
“This year, the recovery in FMCG festive sales will be driven by more relaxed restrictions, optimism surrounding the vaccine availability and the end of panic buying behaviour,” according to NielsenIQ.
Will fashion make a comeback?
Among categories, apparel was one of the worst hit during the Covid-19 year, according to retailers. Apart from some buying spurts during a couple of major promotions and during December, consumers were not in the mood to spend on clothes. Retailers are hoping that the coming weeks will see some movement for fashion and accessories.