Like the rest of the world, the UAE’s consumer spending dynamics are continually changing and even more so now due to COVID-19. With more people working for home, and an increase in health-consciousness, consumers have adopted new behaviours to fit their new lifestyle. We have highlighted below some of the growing trends in the UAE F&B sector.
As consumers avoid shopping malls and supermarkets in response to the pandemic, online retailers and e-commerce platforms are enjoying increasing growth. Businesses like Carrefour in the UAE saw a 300% increase in online orders and a 59% increase in new customers on its e-commerce site between February and April 2020. This drastic increase resulted in Carrefour transforming the majority of its outlets into ‘mini-fulfilment’ centres and their online platform to a marketplace. Generalist e-commerce platforms such as Amazon and Noon, have now ventured into grocery supply along with their traditional retail trading.
The primary driver in this segment is the consumers’ consciousness of COVID and the convenience of having groceries delivered to their doorstep. Before COVID, only 27% of UAE consumers adopted online grocery shopping, but this has since increased to over 50%.
Online platform outlets like Carrefour, Lulu and Kibson’s attract consumers via bundled discounts and loyalty rewards for online purchases. Some platforms are also promoting same-day delivery, a solution that would ultimately reduce the number of trips to the store, serving consumers last-minute requests which suits the UAE market particularly well.
2. Private Label
Several supermarkets across the UAE are increasing their own-label product range to include snacks, processed meat, fish and ready meals. These products are usually at the value end of the price range, thereby attracting cost-concious consumers. In 2019, the two leading private labelling players were Lulu and Carrefourhowever, other supermarkets have since joined the trend.
Supermarkets have intensified their efforts to increase the visibility of their own branded products through continuous promotions, allocation of prime shelf space and in-store activities, especially across categories where consumer brand loyalty is diminishing.
Carrefour has also ventured into new premium private labelling through its “Bio Range” that offers a wide array of health and wellness packaged food items of high quality. The Carrefour Bio Range is a range of organic cereals and bars sold at a similar price point to other leading brands in the category.
Suppliers with experience in producing private-label goods are especially sought by retailers for products such as breakfast cereals; cookies and biscuits; spreads and sauces; sugar; oils; coffee; packaged seafood etc.
3. Healthy Eating
With society becoming more health-conscious than ever before, an increasing number of consumers are interested in natural and organic food. There’s also rising demand for probiotic supplements and drinks, as well as on-the-go collagen-rich drinks due to the multiple health benefits associated with this protein. Gluten-free food and beverages or a combination of vegan and gluten-free options are gaining momentum too.
Supermarkets and hypermarkets are consistently increasing their range of healthy food products offerings. Specialist stores have also opened around the UAE including Organic Foods & Café; Siha & Afia; Down to Earth Organic; Ripe; Greenheart; Organic Planet etc
The demand for healthy food has also fueled the need for innovative and healthy fast food options. In response to this new trend, a few new foodservice outlets have begun to offer healthy fast food alternatives. Kcal is the most popular in this space with outlets across the UAE. The restaurant offers consumers a range of wraps, burgers, salads and snack.
To learn more about the trends in the UAE F&B sector, please contact Wuraola.firstname.lastname@example.org