A striking divergence in consumer behavior is reshaping retail markets across the Gulf region, with the United Arab Emirates and Saudi Arabia developing distinctly different spending patterns according to NielsenIQ’s latest State of the Nation report for Q3 2025.
United Arab Emirates consumers are demonstrating a pronounced preference for premium products across multiple categories. The Fast-Moving Consumer Goods (FMCG) sector experienced a robust 7.7% revenue surge over the past year, while Technology & Durables (T&D) posted a healthy 6.9% increase. This trend reflects a sophisticated consumer base actively trading up for quality and variety, particularly within grocery purchases. Both value and premium FMCG segments in the UAE expanded by more than 20%, indicating growth across the entire spending spectrum.
Conversely, Saudi Arabian shoppers are adopting a more pragmatic approach to everyday purchases while showing greater willingness to splurge on technology. The kingdom’s FMCG market grew modestly at 1.7% year-on-year, driven by value-conscious choices. However, technology spending surged by 4.5%, with premium categories including smartphones, televisions, and tablets leading this expansion. This creates a unique market dynamic where Saudi consumers balance frugality in daily essentials with aspirational technology purchases.
Category performance highlights these contrasting trends. Saudi Arabia’s grocery growth is propelled by Pet Care (+13%), Snacking (+6%), and Beverages (+3%), while the UAE demonstrates balanced growth across categories. The technology sector in both markets shows consumers increasingly comfortable with significant online purchases, with digital channels now representing nearly one-third of T&D revenues.
Retail channel preferences are also evolving across the region. Modern Trade maintains dominance with approximately 70% of regional FMCG sales, but e-commerce is gaining substantial traction. Online sales now contribute 11.9% of FMCG revenue in the UAE and 5.6% in Saudi Arabia. Traditional trade continues to play a significant role, accounting for 18% of sales in the UAE and 23% in Saudi Arabia.
According to Andrey Dvoychenkov, General Manager at NielsenIQ APP, these trends present strategic opportunities for retailers and suppliers. Brands must develop tailored approaches for each market: emphasizing premium technology offerings during seasonal peaks in Saudi Arabia, while optimizing pricing architecture and maintaining robust omni-channel presence in the UAE. Understanding these nuanced consumer behaviors will be critical for capturing growth in the region’s dynamic economies.