The GCC presents a formidable economic landscape for technology applications like AI, enjoying an average GDP per capita exceeding $70,000.
Artificial Intelligence (AI) is today an inescapable reality that on the one hand, threatens to upend numerous white-collar jobs while on the other spells an end to inefficient ways we produce, market and sell products.
Is it perfect? Growing voices speak of the potential threat to humanity if left unregulated and incessant talk about an AI bubble could see investors pull out from AI projects, seeing that their massive investments in the technology have so far failed to yield robust returns.
Still, AI is no doubt considered a productivity boon for any business, especially those whose target audiences are elusive, choosy, and prone to purchase behavior changes due to price volatility and geopolitical events. Returns on Investment (ROIs) might not yet be there, but certainly costs are down, as retail operations become optimized and personalized.
The GCC’s technology landscape
The GCC presents a formidable economic landscape for technology applications like AI, enjoying an average GDP per capita exceeding $70,000, supported by a young, digitally native population, anchored by a smartphone penetration rate that averages 96 percent across the region.
The UAE and Saudi Arabia rank among global leaders in 5G rollout and adoption. The entire region is seeing rapid growth in hyperscale data centers and cloud infrastructure.
The Gulf’s technology ecosystem is driven by state-backed digital transformation agendas seeking non-oil growth drivers, accelerated via digital adoption across commerce, banking, hospitality, warehousing, logistics, travel and trade. This ecosystem is home to automation, virtual payments, and AI-driven communication and advertising.
Digital advertising in MENA countries continues to dominate total ad spend growth. The MENA ad market was projected by WPP Media to reach a total revenue of $6.3bn in 2025, a figure others estimated to triple in 2026, before the Iran war crisis severely dented those expectations.
Retail media networks (RMNs) and super apps offer rapid scaling of full-funnel advertising environments. Even local apps that used to do just one thing, like calling a taxi or ordering food, are handling almost every aspect of daily life. Major players like Careem, Noon, and Talabat offer everything from grocery delivery to digital banking, while government and telecom apps are also joining in to make society nearly cashless.
RMNs like Amazon and Noon have a first-party data platform advantage that allows CPG and FMCG brands to attract and promote products at the moment of purchase, allowing them to measure ROI at various touchpoints in real time.
AI-driven optimization
At the very basic level, media companies are offloading repetitive, manual tasks to AI agents. McKinsey’s analysis suggests that this allows CMOs to save up to 40 percent of their time, moving them away from “dashboard-watching” while allowing increased focus on strategic and creative work that truly drives a business forward.
Ultimately, the goal of this technology is to shift the merchant’s focus from finding problems to solving them. Using agentic recommendations allows brands to act with precision rather than making data-light guesses. Daniel Läubli, Senior Partner at McKinsey & Co., suggests this is a journey where humans remain in the loop to coach the AI, ensuring that these digital tools become a personalized, high-performance extension of the retail team.
Agentic AI is also enabling CMOs to algorithmically track and target consumers at the point of purchase and even beyond.
Embedded across media buying, personalization and pricing, AI empowers brands by dynamically adjusting campaigns, predicting demand patterns and optimizing inventory and promotions.
Owais Mohammed, Regional Lead, IMEA at WD, said that AI and data-driven personalization are already reshaping how businesses compete.
“The real differentiator, though, won’t just be how much AI a business deploys. It will be how effectively organizations store and activate all available data – from active data to the vast volumes of ‘dark’ data that most businesses are currently sitting on but not using,” Mohammed said.
“Dark data represents a significant, often overlooked source of value. When surfaced and used effectively, it can generate new insights that support better decision-making and enable more meaningful personalization.”
He adds: “To unlock this potential, organizations must be strategically prepared…building the right foundation, including a tailored, workload-specific IT infrastructure and a clearly defined storage strategy that can support different needs, providing the scalable, cost-effective backbone needed to retain and access the full breadth of information that AI systems depend on. Without it, much of that data simply remains out of reach.”
Maximizing AI
Redesigning marketing in the age of AI has become a core CMO responsibility, on par with customer satisfaction, growth and ROI mandates.
A 2026 report by the WEF titled “How Organizations Maximize AI’s Potential” says that AI increases conversion by up to 25 percent and reduces churn by about 21 percent through timely, predictive and personalized interventions at the moment of risk or opportunity. This leads to a 5-8 percent revenue uplift. The shift from campaign-led reach and customer-initiated contact to AI-driven inferences of intent, value and risk will lead to 20–30 percent lower cost-to-serve, and 15–30 percent productivity gains.
The report says AI turns operations into adaptive systems that sense, decide and improve continuously across networks, leading to a 20–50 percent reduction in defect rates and to more than 10 percent earnings before interest and taxes (EBIT) impact.
For just-in-time supply execution, AI leads to 27 percent reduction in order lead time and up to 20–30 percent reduction in inventory.
For R&D, AI shortens the time from idea to launch through earlier hypothesis testing and faster human-AI learning cycles, leading to up to 50 percent reduction in time-to-market.
Finally, AI improves decision speed, continuously updating strategic assumptions based on real-time market, customer, competitor and internal signals, leading to nearly 30 percent faster planning cycles, 20–40 percent improvement in forecast accuracy, and 15–30 percent reduction in inventories.
Ad Spend, AI Growth
Global ad spend is projected to grow by 9.8 percent in 2026, up from 6.6 percent when it reached $1.9 trillion, thanks to a massive influx of media expenditures on the Winter Olympics, FIFA World Cup and political elections in 40 countries, according to recent research by leading media economist PQ Media.
The Middle East and Africa AI market was estimated at $24.7bn for 2025, according to Grandview Research.
Amazon DSP (Demand Side Platform) now accounts for 40 percent of total ad budgets for advanced advertisers, as AI-driven optimizations find the best mix of formats and audiences automatically. For brands seeking scale beyond the search bar, DSP and Amazon Marketing Cloud (AMC) now command nearly half of the total spend.
By 2030, AI could contribute $320bn to the Middle East economy, according to PwC. The GenAI market in the Middle East is projected to grow at 46 percent annually between 2024 and 2030, reaching a market volume of $12.2bn by 2030, according to Statista.
