Criteo Research Finds UAE Consumer Spending This Ramadan Pivots On Cashless Transactions
Criteo (NASDAQ: CRTO), the global technology company powering the world’s marketers with trusted and impactful advertising, has released new research on online consumer spending in the UAE during the month of Ramadan.
While consumer spending is still sluggish in the wake of the coronavirus pandemic,
64% of respondents said they are making more online purchases now. Online orders for groceries, beauty products, and meals for home delivery have increased the most in recent weeks.
In a significant behavioural shift brought on by COVID-19, consumers are moving away from cash-based transactions. In fact, bank visits were a low priority for respondents and 83% made fewer visits during the lockdown. The last few weeks have seen online payments becoming a preferred mode of payment even when a cash-on-delivery option was available.
“The COVID-19 pandemic has accelerated the shift to online for every sector, and this includes digital payments. Criteo’s latest research shows that currency is being replaced with credit cards, mobile wallets and other forms of electronic payments,” Alistair Burton, Country Manager MEA atCriteo,said. “UAE consumers have traditionally opted for cash-based transactions, but safety concerns during the COVID-19 pandemic havefostered trust in digital payments. It’s time for businesses to think about the long-term implications of this shift in consumer behaviour.”
Over fears of coronavirus spreading through currency, consumers’ preference for contactless payment methods will not only impact the retail landscape, but also stimulate growth in digital financial offerings.The increase uptake in cashless transactions points to consumer trust shifting from currency that may be potentially contaminated, to cards or mobile wallets that are perceived to be safer options. This adoption of digital payments portends to an irreversible cultural change, expected to last beyond the pandemic.
While overall spending in physical stores has contracted, consumers of all ages have migrated to online shopping. A majority said they will buy more online across all product categories, with 72% planning to buy gifts for Ramadan and Eidonline. Perfumes, beauty products and apparel are the most preferred seasonal gifts purchased online by UAE shoppers.
When it comes to budgets, 68% of millennials (25- to 38-year-olds) plan to spend more than AED 300 for Ramadan and Eid gifts this year. Quick adapters of digital technology, millennials are a rising demographic in the UAE and their spending habits are expected to have a significant impact on ecommerce businesses.
