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  • 06-03-23

    GCC Retail Industry Projections: Luxury, E-Commerce Sectors Lead Growth

    (MENAFN) Luxury and e-commerce retail sub sectors are expected to drive growth in the Gulf Cooperation Council's (GCC) economy, according to the Chairman of Retail Leaders Circle, Panos Linardos. While the luxury retail sector continues to perform well, favoring the in-store model, e-commerce is growing rapidly, fueled by the convenience of online shopping and the spending power of younger digital buyers. The contributions of domestic and regional retailers are also vital as rising prices and supply chain disruptions in key European countries are hindering the delivery and cost competitiveness of their export products.

    In addition to luxury and e-commerce, the industry's growth is also being propelled by three key trends: the integration of physical and digital retail, conscientious consumerism, and the evolution of physical stores. Retail experts predict that the industry will reach an estimated value of SR596 billion ($158.85 billion) by 2024.

    Regarding the integration of physical and digital retail, Linardos notes that although many retailers have incorporated digital technologies into their businesses, they have yet to design the entire customer journey around digital integration. Artificial intelligence (AI) will play a key role in anticipating and responding to shifting consumer demand patterns by streamlining inventory processes, increasing supply chain efficiency and tracking production. Moreover, augmented reality will make online and physical shopping experiences more immersive, support product customization and enhance brand loyalty.

    In summary, luxury and e-commerce retail sectors are projected to lead the industry's contribution to the GCC's economy. Domestic and regional retailers also play a crucial role in supporting the industry's growth as they face challenges with supply chain disruptions and rising prices in key European countries. Furthermore, the industry is expected to reach an estimated value of SR596 billion ($158.85 billion) by 2024, driven by the integration of physical and digital retail, conscientious consumerism, and the evolution of physical stores. Finally, the application of AI and augmented reality technologies will also play a crucial role in the future of the retail industry in the GCC.

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