UAE provides retail research findings

Interviews with 22 top UAE retail executives indicate that most retailers are contending with a common set of social, economic, technological and regulatory issues, as markets transition from runaway growth to a period of consolidation.

Data scarcity and a general lack of market transparency are reportedly hampering retailers' efforts.

Richard Adams, a Verdict consultant and author of the study, said, "Most retailers feel that there is a need for some form of cross-mall industry benchmark data, which facilitate retailers' search for strategic points of sale, while also helping mall operators to optimize mixes and offerings."

Renegotiating leasing rates is also a priority. While operators are selectively dropping rates and retailers are culling stores, there is still significant perceived scope to further refine mall mixes and drive mutually acceptable rental rates. Adams noted, "Dialogue is vital. Only a tiny set of mall operators are regularly engaging with retailers through structured stakeholder research programs and data-share arrangements. Once the ideal balance of tenants has been identified by mall operators, parties should look to collaborate to ensure that the right retailers are in the right locations at sustainable rental rates."

Fully utilizing retail technology and the Internet is another reported concern. Over the last five years there has been a significant realignment in online and offline. According to Verdict, about 9% of UAE consumers now consistently buy online while 38% regularly use price comparison websites to find information about product pricing and establish formulation credentials. Nevertheless, retailer attitudes towards online expansion have been cautious. Understandably, most retailers still favour steering customers towards stores where staff can emphasize value credentials over price and where products can be displayed to full effect.

Commenting on the issue, Adams stated, "Customers now come to stores with product knowledge, which is superior to that of sales staff. Employees need greater product knowledge, and should be trained in the art of in store theatre. The experiential aspects of in store sales have never been more critical."