Riyadh Daily
A view into the growing retail landscape in Saudi Arabia

Retailers in Saudi Arabia are heading toward digital marketing. E-commerce will increase in the future in various brands, whereas, traditional markets will also keep on existing. Customers tendency in Saudi Arabia mostly prefer digitalization and tech savvy world, due to the new generation’s attitudes. Some customers mainly the elderly still believe in checking the quality of the products physically. So, the best markets will keep both on line and physically solutions available.

1. How is the retail landscape of Saudi Arabia evolving?
The retail industry has undergone significant changes in recent years, especially with the year 2020 transforming consumer and workforce trends. Retailers had to quickly adapt to maintain relevance and gain a competitive edge. As a result, retailers in the KSA used digital and omnichannel platforms more frequently, as the sector geared up to provide better customer experiences across all touchpoints. Value brands are currently the retail segments in Saudi Arabia with the fastest rate of growth, due to the use of data to provide customers with exceptional experiences.
Since 40 per cent of Saudi Arabia's population is under 35, Gen-Z and Gen-X consumers have also created a wealth of opportunities for digitally-aligned retailers. BFL has taken advantage of these opportunities by developing digital strategies to offer products that meet this generation's expectations and establishing a connection with the tech-savvy era.
2. How would you compare the offline and online retail markets in Saudi Arabia? There is no denying that e-commerce has revolutionized global trade. According to a report by Statista Digital Market Outlook, the e-commerce market in Saudi Arabia is anticipated to grow significantly in the coming years. However, in contrast to the 17 per cent annual growth between 2020 and 2021, the compound annual growth rate (CAGR) projection for the following four years is at five per cent. This decline in annual growth indicates a relatively saturated market. Also affecting the saturation of the market is the 69 per cent online penetration rate, which indicates that 69 per cent of the population in KSA made at least one online purchase in 2021. Even though the online sector is flourishing, physical retail still dominates the market, as evidenced by the rising footfall at malls and shopping centers since COVID-19 restrictions were lifted. As a company, the BFL group has always valued physical stores just as much as online stores, since we are committed to providing omnichannel experiences to all of our customers. Despite rapid digitalization, we believe both physical and online segments have flourished in recent times and will continue to do so in the future.
3. What are some of the trends and developments in Saudi Arabia’s online retail industry? The COVID-19 pandemic was the driving force behind the e-commerce surge, which is now prevalent not just in Saudi Arabia, but across the globe. Retailers successfully leveraged social media and messaging platforms to engage with more customers and stay ahead of the market trends. Customers' preferences have also changed, with convenience becoming a top priority. According to some market studies, 90 per cent of KSA's consumers prefer to shop in a simple and efficient manner. The industry is also adjusting to the massive influx of influencers, omnichannel platforms, and advanced solutions like headless commerce, the metaverse, and automated experiences, among others. Being an expanding business in this industry and having years of experience, we are constantly trying to keep up with the latest trends. Since the advent of e-commerce, we have quickly adapted to the concept, which has enabled us to get back up and running despite the challenges posed by the pandemic and has taken us into new directions. In order to ensure smooth operations and customer satisfaction, we are also looking at popular trends such as integrating robotics and AI into our operations and workflow. Since the Middle East is showing true potential for e-commerce retail growth, and Saudi Arabia has the highest levels of internet, smartphone, and social media use in the region after the UAE, the sector is bound to grow rapidly.
4. What do you think about customer expectations in Saudi Arabia? Customers seek enhanced experiences and quality products, which is a global standard, and retailers are adapting and evolving in response to these demands. As consumers demand better experiences from brands, it is certain that companies must innovate. The BFL Group adopts a customer-centric strategy, as it is essential to stay ahead of evolving customer needs in order to be successful in the segment. Moreover, we believe we can tackle challenges and drive success in the KSA market, based on our expertise in the industry and understanding of customer behavior. As the retail industry in Saudi Arabia continues to grow, we are gaining a better understanding of our customers' expectations and look forward to utilizing this knowledge more in the future.be successful in the segment. Moreover, we believe we can tackle challenges and drive success in the KSA market, based on our expertise in the industry and understanding of customer behavior. As the retail industry in Saudi Arabia continues to grow, we are gaining a better understanding of our customers' expectations and look forward to utilizing this knowledge more in the future.

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