Consumer Retail - Industry - MEA Market, Share and Trends 2023-2028

Summary of Consumer Retail

Consumer retail in the Middle East and Africa (MEA) region has experienced a remarkable evolution over the past few years. Based on our estimates, we project that the consumer retail market of the Middle East and Africa region would reach $3883.28 billion in 2029 from $2430 billion in 2023 with a CAGR of 8.05 %.

The consumer retail industry across the Middle East and North Africa (MEA) region has experienced rapid transformation in recent years which are driven by a lot of factors that are — evolving customer preferences, rising internet usage and the growing influence of global brands and e-commerce platforms. Retail sales in the MEA totaled over $300 billion in 2021 and are projected to reach $500 billion by 2026 according to our research norms, underscoring substantial growth opportunities.

Traditional brick-and-mortar retailers have invested heavily to modernize their stores, implement omnichannel strategies, and enhance digital capabilities to better meet rising consumer expectations for convenience, personalized experiences and around-the-clock access to products. E-commerce in particular has surged globally and across the MEA region in response to the pandemic and associated shifts toward online shopping. Leading online retailers like Noon and Souq have expanded rapidly with new fulfillment centers while international giants Amazon and AliExpress have also increased their presence.

Shifting demographics also impact retail trends as —a young, increasingly affluent, urban population —adopts global lifestyle brands and new technologies. Social media influences consumer purchase decisions more than ever.

Recent Trends and Insights

Lockdowns and safety concerns drove more consumers to purchase goods online for the first time. E-commerce penetration has grown rapidly across the region as retailers invested in digital capabilities and consumers grew accustomed to the convenience of online shopping. This channel is expected to continue gaining share even as stores reopen.

The pandemic heightened awareness of personal health, fitness and nutrition. Retailers have capitalized on this demand by expanding offerings for at-home exercise equipment, healthy snacks and immunity-boosting products. Categories like sports nutrition, vitamins and supplements have seen sustained growth.

Economic uncertainties stemming from the health crisis and oil price fluctuations have made consumers across MEA more value-focused. Retailers are responding by optimizing assortments to emphasize essentials and affordable private labels over discretionary items. Promotional activity and loyalty programs have also intensified.

The lines between offline and online retail have blurred as consumers research online and pick-up in stores, or order online for store/curbside collection. Multichannel retailers have accelerated integration of their physical and digital shopping experiences to provide a seamless customer experience.

Younger consumers in particular are paying closer attention to brands’ environmental and social impact. Retailers are localizing sustainable sourcing and packaging initiatives to connect with these values-driven shoppers. Transparency around ESG practices will be increasingly important.

Product Insights

Staples like packaged foods and household goods saw increased demand as consumers stocked up. Healthier private label options are gaining traction. Online grocery remains niche but is growing.

Device sales grew, driven by work-from-home and virtual learning trends. Affordable laptops, printers and webcams sold well. 5G-enabled phones are driving upgrades. Casual fashion replaced formal wear amid widespread remote working. Activewear and loungewear emerged as top-selling categories. E-commerce allowed brands to activate dormant categories.

Home improvement products sold briskly as people invested in their living spaces. Outdoor furniture was also popular with the shift towards al fresco living. Virtual showrooms aided large item sales. Prestige beauty sales declined with reduced socializing but mass categories proved resilient. Self-care products like skincare and haircare gained ground. Online became a key discovery channel.

Retailers’ e-commerce sites should necessarily be able to handle increased traffic and order placement. Their decision makers should put in place analytics to ensure that they can keep track and make informed conclusions. Such analytics may include system alerts for key metrics and real-time dashboards. Many retailers have partnerships with third parties to help them scale technology rapidly, taking in front-end activities, marketing, DevOps tooling, and back-end integration.

Key Companies

Some major players within this vast domain of industry are

• Ernst & Young Global Limited
• Microsoft
• Nestlé
• Spar
• Shoprite
• Carrefour
• IBM
• Deloitte Touche Tohmatsu Limited
• PepsiCo
• Merav-Mazon Kol

Regional Analysis

The Gulf Cooperation Council (GCC) countries of Saudi Arabia, UAE, Kuwait, Qatar and Bahrain present concentrated opportunities for consumer brands due to their oil wealth and large populations. Total combined GDP of the GCC in 2022 exceeded $2 trillion according to many industry norms. However— political stability varies across the region with conflicts impacting some nations.

Having a large chunk of population that is 100million, Egypt makes up for the largest market in Africa. The Egyptian government has pursued economic reforms aiming to attract greater foreign investment, though challenges remain. South Africa similarly has a diverse economy and represents the second largest African market for consumer products.

E-commerce and mobile commerce channels are expanding beyond tier-1 cities as smartphone and internet penetration increases across MEA countries. Major online retailers have invested in the region with localized websites, payment solutions and fulfillment infrastructure. This allows both international and domestic brands to reach broader consumer segments.

Regional conflicts and sanctions on countries like Iran, Syria and Yemen have negatively impacted some economic growth forecasts in recent years. Political headwinds and sanctions regimes slow domestic consumption in the affected nations, though underground markets still exist. Neighboring countries also experience spill-over effects on trade and investment.

Overall— the diverse markets across the Middle East and Africa present sizable potential for consumer-oriented multinational businesses and domestic players. Continued economic development and rising standards of living in many countries point to promising long-term prospects, assuming stability.

Market Segmentation

By Type:

• Ecommerce platforms and mobile apps
• AI-powered product recommendations and personalized shopping
• AR/VR for virtual try-ons and interactive displays
• IoT solutions for supply chain and inventory management

By End User:

• Retail chains, franchise brands
• Grocery stores and supermarkets
• Direct-to-consumer brands
• Online marketplaces

By Enterprise Size:

• Large retailers
• Small and mid-sized stores
• D2C startups

By Country:

• Saudi Arabia
• Iran
• United Arab Emirates
• Israel
• Egypt
• Iraq
• Qatar

Our Methodology

We have offered a well-founded review of Middle-east and Africa’s regional consumer retail market along with ongoing trends and upcoming projections to highlight proximate investment opportunities in this report. Moreover, an extensive analysis of any future prospects, challenges, competitors, or navigating aspects is also provided. A methodical detailed regional examination is presented.

Primary Research  

Our multi-pronged research approach includes interviews with industry leaders and a global survey of advanced manufacturing professionals to gain qualitative insights. We utilize our proprietary databases encompassing key performance indicators worldwide in order to collate relevant data points. A multivariate forecasting framework considering historical performance, current dynamics and qualitative factors are utilized to develop market sizing and growth projections through 2029.

We supplement our primary research with a careful examination of secondary materials such as– case studies, news stories and references from other sources. Organizations can benefit from the strategic advice and conclusions offered because they will be better equipped to respond to the dynamic nature of this industry and seize emerging possibilities.

We employ a comprehensive and iterative research methodology focused on minimizing deviation to provide the most accurate market estimates. Our research utilizes a combination of bottom-up and top-down approaches across segments and utilizes databases, primary research insights and industry experts for analysis.

Raw data is obtained from multiple sources and thoroughly filtered to ensure only authenticated and validated sources are considered. We collect data from raw material suppliers, industry associations, technology providers, and buyers to gain a holistic perspective.

Quantitative Analysis

Our market estimates are derived through statistical models, beginning with collection of historical data and analysis of macro- and micro-economic factors influencing the market. Gathered information on market dynamics, technology and pricing trends are utilised to build the models.

Econometric and technological models are applied to project short- and long-term market potential respectively. A bottom-up approach is preferred to minimize errors. Key parameters considered include market drivers and restraints, material pricing trends, regulatory scenarios, and capacity additions.

Weights are assigned to these parameters based on impact analysis and market forecasting is performed via statistical tools and techniques. We believe this methodology results in an accurate and realistic market picture.