Consumers are becoming more cautious about spending amid rising prices

Rising prices rated as the biggest issue for 34% of in-store shoppers and 27% of online shoppers. Consumers are becoming more cautious about spending amid rising prices and 62% intend to adopt cost-saving behaviours.

Consumers in the Middle East and other parts of the world are basing their shopping behaviours on two main factors, high inflation and high cost of living. As supply chain disruptions are also being witnessed in the consumer industry, shoppers in the Middle East are finding new alternative ways to purchase goods, while keeping a close monitor on their finances and spending.

Three key themes are being witnessed among consumers in the Middle East:

Higher prices and supply chain delays hinder sales: Rising prices for household goods were the top concern for 40% of respondents in Egypt, 35% in Saudi Arabia and 28% in the UAE. Larger queues, longer delivery time and reduced product quality and availability all prove to be other significant issues regional consumers frequently experience.

Consumer habits are changing in response to higher prices: Shoppers expect to spend mainly on groceries (47%), fashion (40%) and consumer electronics (36%) over the next six months. Consumers are becoming more cautious about spending on luxury, home entertainment and virtual activities and increasingly looking for promotions, with more than 40% of regional and global consumers buying only products at ‘offer prices’ and seeking to buy from retailers who offer better value.

Multiple sales routes in a smarter retail world: Online shopping continues to go from strength to strength, but in-store shopping continues to play a key role. There is also an emerging minority who use VR for shopping, browsing virtual stores and testing products. However, regional consumers are seen to be concerned about the privacy of their data, with social media and website usage (40%) causing great concern. Close to half of regional consumers said they don’t share any more personal data than is necessary and this is the key action taken to address their data privacy concerns.

Amid changing consumer behaviour, retailers need to confront supply chain disruptions and online and in-store frictions that interrupt the seamless experience that tech-savvy hybrid consumers increasingly expect. Retailers are increasingly expected to provide smart solutions that offer consumers a better and more convenient shopping experience and fuse the digital and physical worlds.

Findings from PwC Middle East’s Global Consumer Insights Survey – Pulse 5, ‘Inflation and rising prices shape a new hybrid Middle East consumer’.

Rupkatha B