Based on responses from consumers in Egypt, Saudi Arabia and the United Arab Emirates – with additional information covering Pakistan – the 2018 Middle East Sentiment Survey found that more than half (55%) now look to spend less and save money.
Produced by McKinsey & Company, the professional services firm, and unveiled at the recent Retail Leaders Circle event in Dubai, the survey also revealed that 78% have changed their shopping habits to save money.
As reported by An-Nahar, multi-channel shoppers have cut spending across all channels and increasingly favour discount formats and chain grocery stores.
For example, more than a third (35%) now look to buy their preferred brands at any cost instead of trying out alternatives at cheaper prices, compared with 45% in April 2017.
And this trend has become particularly pronounced in Saudi Arabia and UAE where consumers feel they have been forced over the past two years to make adjustments to their spending habits, the report added.
McKinsey said shoppers in the region fell into five categories, which it named as savvy cost-cutters, thrifty brand loyalists, selective splurgers, trade-down converts and multi-channel shoppers.
Overall, more than half (54%) of those who have chosen to trade down reported that they were satisfied with their decision, leading McKinsey partner Gemma D’Auria to observe that consumers are now less brand loyal than previously.
“People are becoming less brand loyal. Earlier, they were looking more for preferred brands in cheaper channels, now they are more inclined to try and stick with lower cost brands,” she said. “This shift is attributed to an increase in the perceived and real quality of lower tier brands.”
Sourced from McKinsey & Company, An-Nahar; additional content by WARC