Consumer spending in the UAE and Saudi Arabia continued to grow in the first quarter of 2026 despite cautious sentiment, with shoppers increasingly seeking value across multiple retail channels, according to the latest State of the Nation report released by NielsenIQ.
The report found that the combined consumer basket in the UAE and Saudi Arabia reached $56.2 billion in 2026, driven by strong growth in the fast-moving consumer goods (FMCG) sector. FMCG sales rose 7.3%, led by double-digit growth in snacking, beverages and ambient foods.
In the UAE, consumers increased spending across both FMCG and technology and durable (T&D) categories. In Saudi Arabia, however, FMCG spending declined by 1.1% due to weaker performance in home care, baby care and frozen foods, although T&D spending grew by 6%.
The report highlighted consumers’ growing preference for value-driven shopping. Spending expanded across traditional retail, organised trade and e-commerce channels. In the UAE, traditional trade recorded growth of 10.9% in FMCG and 16.8% in T&D, while e-commerce accounted for 13% of the FMCG market and more than 30% of T&D revenues.
Saudi Arabia also witnessed strong online shopping activity, with e-commerce revenues increasing by 55% year-on-year.
The study found that demand remained strong for both premium and value-priced products. Premium FMCG products grew by 19% in the UAE and 14% in Saudi Arabia, while value offerings rose by 17% and 19%, respectively. In the T&D segment, premium brands recorded growth of 20% in the UAE and 8% in Saudi Arabia, while value products increased by 14% and 11%.
Competition among brands also intensified during the quarter. The number of active FMCG brands rose by 8% in Saudi Arabia to more than 11,000 and by 6% in the UAE to over 13,000. In the T&D sector, active brands increased by more than 18% across both markets, with each country recording more than 40,000 active stock-keeping units (SKUs).
Andrey Dvoychenkov, General Manager Arabian Peninsula and Pakistan at NielsenIQ, said, “The Middle East consumer is far from passive; they are deliberate, channel-agnostic, and increasingly sophisticated in how they allocate their spend. Our data makes clear that a one-size-fits-all strategy is simply not viable in this region.
“Whether a brand is competing in snacking, smartphones, or household care, the battleground has shifted: it is no longer just about presence on shelf, but about earning a place in the consumer’s wallet at the right price, in the right channel, at the right moment. The brands that will win are those that understand the dual pull of value and aspiration and build their go-to-market strategies around both.”
The report concluded that while economic conditions across the region remain favourable, brands will need more agile pricing, channel and portfolio strategies to remain competitive as consumer choice expands and shopping habits continue to evolve.
