Riyadh, Saudi Arabia – June 26, 2025: Saudi Arabia and the United Arab Emirates are seeing a surge in consumer spending, driven by a potent combination of digital transformation, shifting retail dynamics, and evolving shopper preferences that increasingly split between value and premium choices.

In Saudi Arabia, consumer outlays reached unprecedented levels this spring. Data from the Saudi Central Bank shows spending soared to SAR 148 billion ($39.45 billion) in March, marking the highest monthly total since May 2021. Though that figure eased slightly in April, the underlying momentum remains strong, buoyed by robust online activity and a consumer base steadily embracing both cost-effective and premium goods.

A recent report by NielsenIQ paints a nuanced picture of this trend. Spending on fast-moving consumer goods (FMCG) in the Kingdom rose 3.3 percent in the year to March, while purchases of technology and durable goods nudged up by 0.2 percent. Particularly strong performers included petcare, which surged by 10 percent, and snacking, up 9 percent—suggesting that consumer priorities are shifting alongside broader lifestyle changes.

The UAE, meanwhile, is also experiencing a spending upswing, with FMCG growth climbing 7 percent and tech and durables purchases hitting $5.3 billion—a 2 percent year-on-year increase. Demand was particularly strong in smartphones, media tablets, vacuum cleaners, and personal care items. Frozen foods, beverages, and dairy products also saw notable growth.

The rise in spending is taking place in the context of a rapidly evolving retail environment. E-commerce is gaining significant traction across the Gulf, driven by increased digital literacy, strategic investments in infrastructure, and a growing preference for convenience. Online sales now account for 30 percent of tech and durable goods and 11 percent of FMCG purchases in the UAE, with Saudi Arabia not far behind—T&D e-commerce grew by 7.7 percent, and online FMCG market share rose by 1.4 percentage points over the past year.

Traditional retail channels remain a stronghold in the UAE, where small, independent shops are outpacing organized retail chains, particularly in FMCG, which saw 10 percent growth in traditional outlets compared to 3.2 percent in organized formats. In both markets, digital payments—especially via the Saudi Mada system—continue to rise, further reflecting the deepening integration of tech into everyday consumer behavior.

Behind this consumer resilience is a larger economic narrative. Both Saudi Arabia and the UAE are outperforming global economic averages, with projected GDP growth of 3 and 4 percent respectively for 2025, compared to 3.2 percent globally. Their success is underpinned by strategic diversification efforts, international partnerships across East and West, and policy initiatives targeting digital transformation.

That forward-looking approach is making the region increasingly attractive to global brands. NielsenIQ’s analysis shows Saudi Arabia is now home to more than 10,500 active FMCG brands and nearly 100,000 stock keeping units (SKUs), both up 5 percent from the year before. In the UAE, those figures rise to 13,000 brands and 130,000 SKUs, respectively. In the tech and durables space, brand activity has grown even faster—21 percent in Saudi Arabia and 18 percent in the UAE—while SKU counts have more than doubled in both markets.

This influx of choice is not lost on consumers, who are becoming more discerning in their spending. The report notes a sharp polarization in purchasing behavior: both value-focused and premium segments are growing in double digits, across FMCG as well as tech and durables. In Saudi Arabia, value-oriented tech goods grew 6 percent, while the UAE saw a 3 percent rise—underscoring the rise of what analysts describe as the “strategic shopper,” a consumer as likely to seek competitive pricing as they are to invest in high-end offerings.

Consumer sentiment supports this retail optimism. Ipsos’ May 2025 Consumer Sentiment Index for Saudi Arabia held steady at 72.2, with 64 percent of respondents describing the economy as strong and 77 percent expressing confidence in their financial future. Still, the report noted a slight dip in job security confidence, particularly among expatriate communities.

The regional outlook remains bullish. Analysis of more than 6.8 million digital transactions across the Middle East and North Africa identified Saudi Arabia, the UAE, and Kuwait as top contributors to gross merchandise value, confirming the depth and durability of consumer engagement in the Gulf.

“The economic momentum we’re witnessing across the Middle East, particularly in the UAE and Saudi Arabia, is a testament to the region’s strategic vision and adaptability,” said Andrey Dvoychenkov, General Manager of NielsenIQ APP. “We’re seeing strong growth in both premium and value segments, and a rapid evolution in retail channels—especially online. For brands, success hinges on relevance, agility, and a deep understanding of consumer expectations.”

As global players double down on their presence in the Gulf, the stakes have never been higher. The Gulf’s twin giants, Saudi Arabia and the UAE, are not just weathering economic headwinds—they’re setting a new pace for consumer markets in the digital age.