By: Ejaz Mirza- AVP – Client Development, Middle-East & Africa, Borderless Access
Covid-19 and the global lockdown have affected almost every aspect of life as we knew it. Shopping behavior is naturally one of the elements that has seen the most upheaval, as consumers worldwide have had to embrace alternative ways of purchasing groceries and other requirements.
Globally, a third of people are shopping online more than they did pre-lockdown, with this trend being strongly driven through various countries including Saudi Arabia.
While UAE consumers have also increased their reliance on online shopping, they are balancing their retail needs between online and physical shopping to a greater extent than Saudi consumers, and for that matter, than the global average. This reinforces the findings that we saw in a recent media study, that Saudi is embracing digital sources more than UAE.
There are even 11% of UAE consumers who have not cut down on their physical store usage at all, during the pandemic.
Where physical stores are being avoided, it is generally because they are felt not to take responsibility for their shoppers’ safety. It goes without saying, that the most avoided stores are those that feel too crowded or that don’t observe necessary Covid safety protocols. UAE shoppers avoid these stores more than both their Saudi counterparts and the global average.
Other than non-adherence to protocols, we see other reasons for stores being avoided. Non-essential goods have been hard hit due to the pandemic. Niche stores are not frequented as commonly as they had been in the past. Perceptions over malls are split in the Middle East: in the UAE, 53% of shoppers are avoiding these locations more than before, but they are not avoided as much in the Kingdom of Saudi Arabia.
Not surprisingly, pharmacies are the physical store that people have avoided the least, globally and in the Middle East. Groceries, clothing stores, and day-to-day specialty stores (the likes of hardware, homeware, or electronics) are also utilized at levels that are closer to their pre-Covid usage. This indicates a strong reliance on the essential goods that they offer – and presents opportunities for all stores to communicate their availability of essentials.
Of the shoppers who are still utilizing physical stores, their frequency of shopping has naturally been affected too. Almost two-thirds of shoppers globally are shopping less frequently at physical stores than they did before, and 23% are buying in bulk in order to reduce their number of visits. This trend of bulk buying is much more strongly driven in the UAE than in Saudi Arabia.
Of course, this trend has been influenced not only by safety factors but also by the fact that wallets are tighter as people struggle to retain work over an unsettling time.
Interestingly, globally there are 10% of shoppers who shop more often than before the pandemic, this incidence being the same for Saudi consumers. While 9 out of 10 shoppers frequent shops less often in efforts to stay safer, evidently 1 in 10 is shopping more, perhaps due to lack of alternate ways to pass the time.
What would encourage physical shopping?
72% of consumers would shop more frequently at physical stores if certain safety measures were implemented, with this measure being even higher (83%) in the UAE.
The top three required safety measures are not surprisingly, sanitizer availability, enforced social distancing and mask-wearing by the store personnel. For all three measures, the UAE scores higher than Saudi in terms of requiring them.
What would increase online shopping further?
In contrast to the reduction in the frequency of physical store purchases, 44% of consumers globally are shopping more often at online stores. Naturally, this is partially due to the safety element of staying home but is also influenced by discounts and promotions offered by the online stores.
Those who don’t yet embrace online shopping would be persuaded to do so if certain elements were put in place. The most important of these is for the online shopping platforms to specify exact delivery times, and the second again speaks to safety during these uncertain times. However, other low-hanging fruits for online players to reap include offering easy exchange policies and intuitive navigation and purchase process.
Same-day delivery and offering substitute products are more important in the UAE than in KSA or the rest of the world.
While there is a limited share of wallet (and a tighter one than ever at the moment), there are opportunities for both physical and online stores to increase their consumer base in the Middle East. Other than the obvious element of making shoppers feel safer, there are several ways in which sales can be boosted.
Physical stores can focus on communicating the essentials that they offer, as these remain a way to pull physical shoppers to them. Bulk offerings can also be leveraged to attract shoppers.
Online stores can build on the increased awareness of digital mediums in KSA by further utilizing these channels to retain shoppers. In the UAE there is room to increase online shopping, by offering exact delivery times, easy exchange policies, and intuitive purchase experiences.
There are enough opportunities for both physical and online shopping platforms, provided brands understand and adequately fulfill ever-changing consumer needs, focusing foremost on delivering an optimal consumer experience.