The United Arab Emirates’ retail sector demonstrated remarkable resilience in 2025, with the Fast-Moving Consumer Goods (FMCG) market achieving 6.8% value growth according to NielsenIQ’s comprehensive State of the Nation report. This robust expansion was primarily fueled by a substantial 4.9% surge in consumption volumes, augmented by a 2% increase in unit values, signaling a strong consumer-led recovery in the post-pandemic era.
A transformative shift characterized the Emirates’ retail landscape as consumers simultaneously pursued both affordability and premium quality products while accelerating their migration toward digital shopping channels. While Modern Trade maintained its position as the dominant retail channel, e-commerce emerged as the fastest-growing platform during the fourth quarter, capturing increasing market share as shoppers embraced online grocery services for their convenience and competitive pricing.
Notable category performance revealed Snacking as the UAE’s fastest-growing FMCG segment, reflecting heightened demand for convenience foods and impulse purchases. Concurrently, the market exhibited pronounced premiumization trends, with premium brands outperforming both value and mid-tier competitors. This aligns with evolving consumer sentiment, where 70% of UAE consumers expressed willingness to pay premium prices for superior quality products despite ongoing inflationary pressures.
The Tech & Durables sector surpassed FMCG performance with 6.3% value growth in 2025, driven by sustained demand for telecommunications products, large home appliances, and consumer electronics. Major shopping events including Singles Day, Cyber Monday, and seasonal discount festivals generated substantial online traffic, solidifying e-commerce as the preferred purchasing route in this category.
Promotional activity remained stable throughout the year, primarily supported by the Dubai Shopping Festival. Temporary Price Reductions continued to dominate promotional strategies, though their overall efficiency moderated compared to previous years, indicating intensifying competitiveness across retail channels.
Product diversification reached new heights with the FMCG market recording 134,271 active SKUs, reflecting significant expansion as brands broadened their offerings and digital-first emerging brands tapped into the increasingly sophisticated consumer base. The T&D category similarly experienced over 20% year-on-year growth in available brands, driven by affordable innovators and expanding online marketplaces.
Regional comparisons revealed contrasting dynamics, with Saudi Arabia’s FMCG market contracting by 1% in value due to flat volumes and declining unit values. However, the Kingdom demonstrated stronger momentum in Tech & Durables, posting 13.7% value growth—more than double the UAE’s rate—driven by seasonal promotions and digital marketplace activity.
Andrey Dvoychenkov, NielsenIQ General Manager for the Arabian Peninsula and Pakistan, noted the data reflects ‘strong resilience amid evolving consumer and pricing dynamics,’ emphasizing that ‘while Modern Trade remains dominant, it is e-commerce that is reshaping growth across FMCG and Tech & Durables.’ The report concludes that the regional retail environment is now defined by digital acceleration, value-premium polarization, and heightened promotional intensity, presenting both challenges and significant opportunities for brands and retailers capable of balancing affordability, quality, and digital execution.