Ramadan a boom time for UAE retailers

As the holy month of Ramadan continues, it is also one of the most significant consumer moments in the region, inspiring shoppers to not only discover new brands but also stay up to date with the latest products. The month typically brings a substantial surge in customer traffic and spending across various product categories related to Ramadan festivities and gifting, and retailers have been tailoring their campigns to maxmise sales during this period.

“For us at Samsung, Ramadan sales insights help inform our product strategy by allowing us to understand consumer trends and preferences better. This valuable data guides our product development and marketing efforts, enabling us to innovate effectively and drive sustainable growth. This year, we anticipate robust Ramadan sales across all our key product categories, including mobiles, TVs and home appliances. The market feedback and the customer response to some of our recently launched innovative offerings have been overwhelmingly positive, contributing to our optimistic sales outlook for the Ramadan season,” Shafi Alam, head of direct-to-consumer business & corporate marketing at Samsung Gulf Electronics, told Khaleej Times in an interview.

According to a survey conducted by Google, 86 per cent of regional consumers consider Ramadan as the opportune moment to discover the most enticing offers. “With 64 per cent of residents spending more in Ramadan in 2023, it presents a strategic opportunity for us to engage with our customers,” Marc Laurent, president, retail – everyday goods, GMG, told Khaleej Times.

Additionally, consumers are more open to trying new products and supporting local businesses during Ramadan. In fact, 78 per cent of respondents in the Middle East expressed interest in exploring new brands during their Ramadan shopping, research shows.

Wellness products are one of the key items that are high in demand during this month. According to a YouGov Guide to 2024 Ramadan Shopping Insights Report, 29 per cent of UAE consumers are most inclined to explore wellness products this year. “The pursuit of well-being has taken significant prominence in the post-Covid era. This is elevated during Ramadan when health and wellness take centre stage due to fasting, leading to increased purchases of health supplements and fitness products,” Laurent said.

Due to increasing inflation and global uncertainty, regional consumers (three in 10) have been switching to cheaper brands or retailers, particularly in the food and groceries sector. “Deals and offers can make the difference in customer engagement in such an environment. GMG has launched attractive offers across its portfolio, with Géant and aswaaq offering discounts of up to 75 per cent off on a wide range of food and non-food products throughout the month,” Laurent said.

Despite this, retailers anticipate an uptick in consumers’ spending budgets, and this pattern necessitates retailers to prepare for a surge in shoppers. “However, it’s important to note that consumer spending is being increasingly tied to factors such as value, ambience, product quality and service, highlighting the evolving preferences of today’s shoppers,” Laurent said.

“Despite economic uncertainties, the resilient GCC economies foster consumer confidence and higher spending. The premium segment is in focus as shoppers increasingly prioritize purchases from brands they trust to be high-quality, reliable, and ready for the future,” Alam said.

According to a YouGov Guide to 2024 Ramadan Shopping Insights Report, 40 per cent of UAE consumers are most inclined to explore electronic gadget purchases this year, with 24 per cent actively on the lookout for devices that integrate the latest technologies. “Artificial intelligence is a major theme in user preference for electronic devices this year. Therefore, we expect AI-enabled products to be a major hit with consumers this Ramadan,” Alam said.

While e-commerce grows, Gulf customers still value the in-store experience, forging a hybrid shopping model unique to the region. “This Ramadan, we expect this so-called ‘phygital’ model to dominate, with consumers seeking enhanced, experiential shopping through in-store events, interactive displays, and personalised services,” Alam said.

YOUGotaGift, a leading digital gift card company in the Middle East, experienced a 100 per cent increase in sales during the Ramadan and Eid season with HappyYOU Eidiya Card leading the growth between 2022 and 2023. “At YOUGotaGift, we have seen an increase in the average ticket size and the Ramadan Card purchases by both B2B and B2C customers this year. With the increased spending power from both consumers and companies this year, we anticipate a stronger adoption of eGift Cards for their gift-giving and rewarding needs,” Husain Makiya, CEO, YOUGotaGift, told Khaleej Times.

Companies expect Ramadan sales to have a significant impact on their annual performance. “We anticipate that Ramadan sales this year will have a positive impact on our overall financial performance. Historically, this period witnesses heightened consumer activity, and we have proactively prepared to meet the increased demand. Our strategic planning and tailored offerings for Ramadan are aimed at maximizing retail opportunities while maintaining a focus on customer satisfaction and value,” Laurent said.

Alam agreed, saying that he was optimistic on sales this year. “The record-breaking post-launch performance of our Galaxy S24 series has provided a strong start to the financial year, boosting our quarterly revenue and profitability. Our pre-order sales for the S24 Series rose substantially, 42 per cent year-on-year. As a result, we remain optimistic about the substantial impact Ramadan sales will have on our financial performance this year,” he said.

• Business