A Tale of Two Consumers: How polarized mindsets are reshaping FMCG consumption in Saudi Arabia
- Consumers across generations are switching between premium and value products in the same shopping basket, depending on category, occasion and perceived value.
- Traditional middle-market offerings are getting squeezed as consumers gravitate toward premium or value offerings.
- Ecommerce amplifies the trend by making price comparison, product substitution, promotions and premium cues more visible.
New research from NielsenIQ (NIQ) shows that FMCG consumers in Saudi Arabia (KSA) are alternating between purchasing premium products and trading down to value products, depending on category, occasion, and need. The result is that the traditional middle-market offerings that were once the core of the FMCG market are facing mounting pressure.
The findings come from NIQ’s latest global report, A Tale of Two Consumers: The Polarized Mindsets Reshaping Global Consumption, developed in collaboration with World Data Lab. The report shows that consumers of all ages and income groups and in most markets are increasingly choosing when it is worthwhile to pay a premium and when it makes sense to trade down to save money.
Building on NIQ’s generational spending research in collaboration with World Data Lab, the report finds that the same consumers are moving between “upgrade” and “price-constrained” purchasing mindsets, carefully choosing where a product deserves a premium and where value alternatives are sufficient. An affluent consumer may trade down to “good enough” alternatives when a premium product offers no extra benefit. A mass-market consumer may trade up when quality, performance, trust, relevance or convenience justify the additional cost.
Key findings include:
- Affluent consumers spent $35.9 trillion globally in 2025, surpassing spending by the much larger core consumer population, who spent $31.6 trillion.
- Across all age groups, consumers are increasingly alternating between premium and value-seeking behaviors, depending on category, occasion and need state.
- This shift is creating a “barbell effect”, with demand concentrating at premium and value tiers while the middle market comes under increasing pressure.
- Saudi Arabia’s FMCG market generated $10.7 billion in sales in the 12 months ending April 2026, an increase of 8.3% compared with the 12 months ending April 2024.*
- Premiumization continues to accelerate in KSA. Sales of premium FMCG products reached $4.1 billion in the 12 months ending April 2026, an increase of 18.2% compared with the 12 months ending April 2024. Premium products accounted for 38.1% of total FMCG sales over the period, up 3.2 percentage points from two years earlier.
- Sales of value-tier products reached $2.2 billion in the 12 months ending April 2026, an increase of 22.1% compared to two years ago. Value products accounted for 20.4% of total FMCG sales over the period, an increase of 2.3 percentage points from April 2024.
- Mainstream products accounted for 41.5% of total FMCG sales in the 12 months ending April 2026, down 5.5 percentage points from April 2024. Sales in the mainstream segment declined by 4.4% to $4.4 billion. This highlights how traditional middle-market offerings are being squeezed as consumers gravitate toward premium or value-tier offerings.
A barbell-shaped retail landscape
“Growth is concentrating at the premium and value end of the price spectrum – in most markets NIQ tracks – creating a barbell-shaped retail landscape. Saudi Arabia is one of the clearest examples of this polarization outside the US,” says Pavlos Pavlou, Managing Director at NIQ Saudi Arabia. “In KSA promotions are helping sustain premium purchases across several categories, suggesting that consumers need a stronger value equation to justify the higher price point.”
NIQ data shows that promotional intensity in Saudia Arabia has increased in key categories such as Home Care, Perishable Foods, and Pet Food, while remaining stable or declining elsewhere. This supports selective premium and value engagement. NIQ also finds that the share of premium and value products in Saudi Arabian ecommerce sales are climbing, while mainstream share is declining. This suggests that e-commerce is amplifying the move away from mainstream products by making price comparison, product substitution, promotions and premium cues more visible.
“For manufacturers and retailers, the implication is that consumers are not necessarily spending less, but they are spending more selectively. A single household may choose premium products in one category while actively seeking savings in another. This creates new opportunities for brands that clearly communicate value while increasing risk for products positioned in the middle,” says Pavlou.
Some of the key takeaways for FMCG manufacturers and retailers are:
- The middle-market product is no longer a safe default. Growth will belong to the brands and retailers that can identify when consumers are willing to upgrade, when they are seeking value, and what each product must prove to earn its place in the cart. Products caught between the two poles of Premium and Value will require sharper differentiation, clearer positioning and stronger value communication to defend share.
- For FMCG manufacturers and retailers, the winning strategy is not to pursue premium or value growth indiscriminately. It is to understand where opportunity exists by market, category and channel and to define the role every product should play. Every product must establish itself as a premium worth paying for, a smart value choice or a trusted staple worth keeping in the basket.
- “Premium” and “value” are no longer products targeting two different consumer cohorts. Both categories of products should be targeted at serving consumer mindsets that are fluid based on category, shopping occasion, or household economics.
- Pack architecture needs to work harder in a polarized market. Traditional strategies may still be useful, but only if they reflect how consumers are trading up or down across premium, middle-market, and value segments. Brands must understand how pricing strategy, pack sizes, promotions, and channels all work together to move value, volume and long-term market share.
* Includes only branded in-store products; excludes Tobacco and private label for all departments.
About NIQ
NielsenIQ (NYSE: NIQ) is a leading consumer intelligence company, delivering the most complete and trusted understanding of consumer buying behavior and revealing new pathways to growth. By combining an unmatched global data footprint and granular consumer and retail measurement with decades of AI modeling expertise, NIQ builds decision systems that help companies turn complex data into confident action.
With operations in more than 90 countries, NIQ covers approximately 82% of the world’s population and more than $7.4 trillion in global consumer spend. Through cloud-based platforms, advanced analytics and AI-driven insights, NIQ delivers The Full View™— helping brands and retailers understand what consumers buy, why they buy it, and what to do next.
© 2026 Nielsen Consumer LLC. All Rights Reserved.
Forward-Looking Statements Disclaimer
This press release may contain forward-looking statements regarding anticipated consumer behaviours, market trends, and industry developments. These statements reflect current expectations and projections based on available data, historical patterns, and various assumptions. Words such as “expects,” “anticipates,” “projects,” “believes,” “forecasts,” and
similar expressions are intended to identify such forward-looking statements. These statements are not guarantees of future outcomes and are subject to inherent uncertainties, including changes in consumer preferences, economic conditions, technological advancements, and competitive dynamics. Actual results may differ materially from those expressed or implied in these statements. While we strive to base our insights on reliable data and sound methodologies, we undertake no obligation to update any forward-looking statements to reflect future events or circumstances, except to the extent required by applicable law.
