Shoppers in Saudi Arabia and the UAE are moving spending away from mainstream-priced fast-moving consumer goods (FMCG) towards value and premium alternatives , according to NielsenIQ’s latest research.
For brands, the findings highlight pressure to demonstrate either meaningful savings or a clear reason to pay more. Around seven in 10 shoppers in both markets say they would rather save money if a product is not clearly better, while roughly two-thirds prefer something clearly premium when spending more.
Six in 10 say mid-range options need a clear reason to be chosen over cheaper or premium alternatives.
The findings combine NielsenIQ’s Consumer Outlook 2027 survey, which covered more than 21,000 respondents across 31 countries, with its measurement of real-world purchasing behaviour. The UAE features in the Consumer Outlook report for the first time.
NielsenIQ categorises Saudi Arabia and the UAE as polarised markets, with shoppers gravitating towards either savings or upgrades.
In Saudi Arabia, mainstream products account for 41.9 per cent of FMCG sales value, compared with 37.9 per cent for premium products and 20.3 per cent for the value segment.
However, mainstream products lost 2.5 percentage points of value share year-on-year in measured FMCG retail sales. The value tier gained 1 percentage point, while premium gained 1.5 points.
In the UAE, premium products hold the largest share of sales value at 45.2 per cent, ahead of mainstream products at 32.8 per cent and value products at 22 per cent. NielsenIQ identifies the UAE as one of the few markets worldwide where premium is the dominant segment.
The UAE’s premium tier gained 0.5 percentage points of value share year-on-year, while value gained 0.3 points. Mainstream products lost 0.7 points.
Globally, NielsenIQ reports that more than $23bn in value share has shifted away from mainstream-priced products towards value and premium alternatives, with Saudi Arabia and the UAE among the markets where polarisation is most evident.
The research suggests that value and premium purchasing are not confined to separate groups of consumers. A shopper may seek savings in one category while choosing a premium product in another.
“Consumers across KSA and the UAE are no longer buying by default. They buy when a compelling reason exists and walk away from purchases that fail to justify their place. Purchases are no longer evaluated on cost alone, but on the balance between price, quality, performance and personal relevance,” said Andrey Dvoychenkov , General Manager – Arabian Peninsula and Pakistan, at NielsenIQ .
Dvoychenkov said, “Polarisation exists not only between different consumers, but also in how the same shopper makes purchase decisions. Some consumers are seeking savings and value. Others continue to spend on premium products that they believe are worth the additional cost. And the same consumer may seek value in one category while remaining open to buying the premium option in another.”
In Saudi Arabia, 43 per cent of respondents prioritise quality and performance when assessing whether an everyday household or grocery purchase is worth it, compared with 29 per cent who prioritise affordability.
In the UAE, around 36 per cent prioritise quality and performance, while 28 per cent prioritise affordability. The research notes that price still matters even among shoppers who put quality and performance first.
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