Today's Edition
MAYS IBRAHIM (ABU DHABI)
Seventy percent of UAE consumers are now using AI tools to inform their shopping decisions – a 44% increase compared to last year, according to Adyen's 2025 Annual Retail Report.
The global financial technology platform polled over 41,000 consumers across 28 countries. Its findings show that AI is a relatively new addition to the shopping routines of many consumers.
More than one in five UAE consumers (21%) used AI in shopping for the first time in the past year, while 62% said they are open to using it to make purchases in the future.
Shoppers are responding positively to the experience, according to the report. It revealed that 65% of consumers say AI helps them discover new ideas when buying clothes, food and other products, and 14% believe their best purchase ideas now come from AI tools.
"Consumers are embracing AI at an unprecedented rate as they discover how this technology is transforming the shopping experience. We're likely entering an era where AI can act as our own personal stylist, curating outfits tailored to individual tastes and preferences," said Roelant Prins, Chief Commercial Officer of Adyen.
"The demographic splits from our research showed some interesting results, especially seeing how older generations have been integrating AI into their shopping habits," he added.
Gen X Drive Adoption Growth
The use of AI in shopping is becoming more common across all age groups in the UAE, according to the report.
This includes 74% of Gen Z (ages 16–27), 75% of Millennials (ages 28–43), and 59% of Generation X (aged 44-59).
"The data shows an especially rapid adoption of AI shopping tools among Gen X consumers in the country with a 49% increase on last year's figures," Daumantas Grigaravicius, Adyen's Head of Middle East, told Aletihad.
"This suggests AI is resonating across a broader age range here vs other markets where it may be more concentrated among younger digital natives."
Grigaravicius noted that retailers need to tailor their approaches to meet each cohort's unique needs and lifestyle.
"AI tools can help busy Gen X consumers save time and discover new items conveniently matching their profiles. Messaging should emphasise AI's practical benefits in simplifying shopping. In contrast, Gen Z shoppers tend to gravitate towards interactive, visually oriented AI experiences via platforms like TikTok," he explained.
AI as a Discovery Engine
The report shows a growing consumer appetite for discovery, with 66% of UAE shoppers using AI to find unique or niche brands.
Grigaravicius noted that this trend presents an opportunity for local startups to gain exposure and market share that may have been harder to capture previously.
"As more consumers use AI to seek out novel products aligned with their interests, smaller brands can rise to the surface based on relevance and appeal, not just size or history," he said.
"Startups should focus on building rich digital content showcasing their distinctive products and stories to make it easier for AI engines to identify and recommend them to well matched shoppers."
On the flipside, global brands will need to emphasise storytelling and localisation to remain visible, added Grigaravicius.
"All in all, AI-driven discovery could level the playing field, rewarding brands – large or small, global or local – that create meaningful differentiation, not just mass awareness."
He also pointed out that localised AI will be absolutely essential for driving widespread adoption of AI shopping tools in the UAE market.
"To make AI feel accessible, relevant and trustworthy to local consumers, it's imperative that it adapts to the country's particular language needs and nuances," said Grigaravicius.
"This means offering full Arabic language support alongside English within AI shopping interfaces. But it's not enough to just translate content – the AI must be trained on natural Arabic conversational patterns and contexts to engage naturally with Arabic-speaking consumers."
Retailers Look to AI for Growth
For UAE retailers, AI is now seen as a key strategy for revenue growth, the report revealed.
Forty-one percent of surveyed businesses plan to invest in AI to drive sales and marketing in 2025, and 37% intend to use it for product innovation.
"AI is no longer viewed as a future bet – it's a current imperative for retailers and consumers alike," said Holly Worst, Vice President of Retail at Adyen.
AI has taken the top spot as the most-cited growth enabler for 2025, according to Worst.
Despite digital tools rising popularity, physical retail remains a stronghold in the UAE.
Thirty-four percent of consumers said they prefer shopping in-store – more than those who prefer online (27%) – due to benefits like trying products, tactile evaluation and immediate purchase.
Grigaravicius recommends retailers bring AI-driven personalisation into stores, creating hybrid experiences that feel both high-tech and human.
This could include using smart mirrors, AI kiosks and real-time insights to guide staff recommendations or using AI to optimise in-store merchandising and layout based on foot traffic patterns, product interactions and sales data, he explained.
This approach is already gaining traction. According to the report, 59% of UAE retailers currently enable customers to shop across both digital and physical channels, with another 16% planning to do so in the next year.
