Bahrain Retail Market By Type (Store-Based Retailing v/s Non Store-Based Retailing), By Region, By Competition Forecast & Opportunities 2024-2032F

Market Overview

Bahrain Retail Market has valued at USD5.80 Billion in 2022 and is anticipated to project robust growth in the forecast period with a CAGR of 15.62% through 2028. The market for Bahrain retail is growing with various factors such as increasing economic growth of Bahrain, rising tourism and trade, growing populations, changing consumer preference, effective marketing and advertising strategy are the factors driving the Bahrain retail market during the forecast period.

Key Market Drivers

Rising Tourism and Hospitality

Tourism and hospitality can have a significant impact on increasing the retail market in Bahrain. Tourists visiting Bahrain often have discretionary income to spend on shopping, dining, and entertainment. This influx of visitors can lead to higher demand for retail products, ranging from souvenirs and clothing to electronics and luxury goods. In addition, tourism brings in a diverse group of visitors with varying preferences and tastes. Retailers can capitalize on this by offering a wide range of products to cater to different demographics, boosting overall sales. Tourist attractions, hotels, and entertainment venues create hubs of activity that attract both tourists and locals. This increased foot traffic benefits retailers located in these areas, as it exposes their products to a larger audience. Moreover, many tourists are interested in shopping for brands that might be unavailable or more expensive in their home countries. This leads to the popularity of outlet malls and shopping centers, where tourists can find discounted branded goods. For instance, the launch of Bahrain shopping festival attracts many tourists in Bahrain. The success of project like Avenues Mall has influenced the demand for retail infrastructure which are also equipped with recreational facilities. Thus, while tourism and hospitality can have positive effects on the Bahrain retail market in the coming years, there can also be fluctuations in demand based on factors like seasonal tourism, global economic conditions, and geopolitical events.

Changing Consumer Preference

Changing consumer preferences play a significant role in driving the retail market in Bahrain, as they do in many other regions. As consumers increasingly prefer the convenience of online shopping, the growth of e-commerce platforms can drive retail sales. Retailers adapting to this trend by offering online purchasing options and reliable delivery services can tap into a larger consumer base. Moreover, consumers are looking for personalized shopping experiences. Retailers that utilize data analytics and AI to understand and cater to individual preferences can enhance customer loyalty and increase sales. In addition, consumers are shifting towards valuing experiences over material possessions. Retail spaces that provide experiential elements, such as interactive displays, events, and entertainment, can draw in customers and encourage longer visits of customers in Bahrain. In addition, consumers value convenience and efficiency. Retailers offering options like click-and-collect, curbside pickup, and one-day delivery can meet these preferences and attract time-conscious shoppers. Thus, with the changing consumer preferences the Bahrain retail market is expanding in the coming years.

Marketing and Advertising

Marketing and advertising play a crucial role in increasing the Bahrain retail market by creating awareness, driving consumer interest, and influencing purchasing decisions. These Marketing and advertising campaigns increase the visibility of retail brands and products. Consistent brand exposure makes consumers more likely to consider these brands when making purchasing decisions. Moreover, engaging marketing campaigns, whether through social media, interactive content, or events, encourage consumers to actively participate and interact with the brand, fostering a stronger connection with consumers driving Bahrain retail market during the forecast period. However, advertising informs consumers about new products, promotions, and offerings. This awareness can lead to increased foot traffic and online traffic to retail retailers or websites. Thus, effective marketing and advertising strategies can expand the Bahrain retail market during the forecast period.

Key Market Challenges

Economic Dependence on Oil

Bahrain, like many other countries in the Gulf region, has been heavily dependent on oil revenues. Fluctuations in oil prices can significantly impact consumer spending, thereby affecting the retail sector. Bahrain's economy heavily relies on oil exports, which can lead to income volatility due to fluctuations in global oil prices. When oil prices are low, government revenues decrease, potentially leading to reduced public spending and consumer purchasing power. This, in turn, can affect retail sales as consumers may cut back on discretionary spending. Moreover, when consumers are uncertain about the future, they tend to be more cautious with their spending, which can impact the overall retail sector. Lower oil revenues may lead to reduced government spending on infrastructure projects, public services, and other initiatives. These projects could have a positive impact on the retail sector by increasing consumer footfall and economic activity. Thus, the direct impact of economic dependence on oil might not be on the retail market itself, its indirect effects on consumer behavior, purchasing power, and overall economic stability can ripple through the retail sector.

Growth in E-commerce

The rise of e-commerce and online marketplaces has disrupted traditional retail models. Retailers need to establish a strong online presence to cater to changing consumer behavior. E-commerce growth can pose both challenges and opportunities for the retail sector in Bahrain. As traditional brick-and-mortar retailers face competition from online retailers that offer convenience, a wider range of products, and often lower prices due to reduced overhead costs. As more consumers embrace online shopping, traditional retailers may experience a decrease in foot traffic and in-store sales, impacting their revenue and profitability. In addition, establishing an efficient e-commerce operation requires a robust logistics and delivery system, which can be challenging to set up and maintain, especially for smaller retailers.

Key Market Trends

Omnichannel Retail

Retailers were focusing on providing a seamless shopping experience across various channels, integrating physical retailers with online platforms. Click-and-collect services, where customers can order online and pick up in-store, were becoming popular. Omnichannel retail is a strategy that aims to provide a seamless and integrated shopping experience for customers across various channels, both online and offline. This approach recognizes that modern consumers interact with retailers through multiple touchpoints, such as physical retailers, websites, mobile apps, social media, and more. By leveraging omnichannel strategies, retailers in Bahrain can enhance customer engagement, improve customer satisfaction, and ultimately drive growth in the retail market. In addition, omnichannel retail allows customers to switch between different channels while maintaining a consistent shopping experience. Moreover, by being present on multiple platforms, retailers can engage with customers in various ways. Social media interactions, personalized email campaigns, and targeted promotions can all contribute to keeping customers engaged and informed about the latest products and offers. Hence, omnichannel retailing can positively impact the Bahrain retail market by creating a more customer-centric approach, enhancing engagement, and providing a competitive edge.

Gaining Popularity of Subscription Based Services

Subscription services have gained popularity worldwide, including in Bahrain, due to their convenience, personalization, and value proposition. These services offer consumers regular access to products or services through recurring payments. This trend was observed across various product categories, from beauty products to food and beverages. Subscription models provide retailers with consistent and predictable revenue streams. This stability can be especially beneficial for businesses in the retail sector, where seasonal fluctuations and economic uncertainties can impact sales. Predictable revenue allows retailers to plan better for inventory, staffing, and marketing efforts. Moreover, Subscribers tend to develop a stronger sense of loyalty to brands they subscribe to. By consistently providing value and meeting customer needs, subscription services can foster long-term relationships and reduce customer churn. Thus, the growth potential of subscription services in the Bahrain retail market, retailers should focus on creating compelling value propositions, offering flexible subscription plans, ensuring seamless customer experiences, and consistently delivering value to subscribers that resonate with Bahraini consumers and contribute to Bahrain retail market growth.

Segmental Insights

Type

Regional Insights

The Capital Governorate region has established itself with a significant revenue share in 2022. This dominance is expected as the Capital Governorate is the commercial and financial center of Bahrain. It houses numerous financial institutions, corporate offices, and business headquarters. This concentration of economic activity contributes to the generation of wealth and prosperity in the region. The region is home to many international businesses, including financial services, oil and gas companies, and multinational corporations. The presence of these businesses often leads to higher income levels and economic growth. In addition, Capital Governorate region in Bahrain, which includes the capital city of Manama, is considered relatively affluent contributing with a major share in Bahrain retail market during the forecast period.

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Recent Developments

• In 2023, Bahrain - Batelco, part of the Beyon Group, has revamped all of its retail shops, adding a self-service digital zone, designed to elevate the customer retail experience. This step is in line with Batelco’s on-going digital transformation of its customer journey in multiple touchpoints such as the website, the Batelco app as well as the retail shops.
• In 2023, City Centre Bahrain, the premier shopping, entertainment, and lifestyle destination in the Kingdom, has announced the leasing of 9,000 sq. meters of retail space with the addition of over 60 brands to its mall retail portfolio. This will increase the total occupancy rate by 18% within this year, with fashion brands commanding the highest retail space followed by Food & Beverage concepts, personal care, and lifestyle brands.

Key Market Players

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Report Scope

In this report, the Bahrain Retail Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below

• Bahrain Retail Market, By Type

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• Bahrain Retail Market, By Region

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Competitive Landscape

Company Profiles

found at Customizations

Company Information

• Detailed analysis and profiling of additional market players (up to five).