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The Middle East’s advertising opportunity is as big as its giga projects

Cranes holding oversized shopping bags on a road in the desert.

Illustration by Reagan Hicks / Shutterstock / The Current

With a population of over 493 million people, and with rapidly growing digital adoption, the overall Middle East and North Africa (MENA) region is at the precipice of phenomenal growth.

This is a real opportunity for all parts of the advertising value chain, from international publishers in the market, to homegrown major brands, to technology platforms, agencies and startups seeking to fulfill the huge and growing demand within the region.

Digital advertising spend in MENA reached $5.5 billion in 2022, growing 20% in just one year, and is expected to more than quadruple in 2024 to $25.5 billion, Emarketer reports.

In a wider context, this means that MENA is the fourth-largest market benchmarked with Europe, according to a study by IAB MENA.

The growth is particularly interesting in Saudi Arabia, which accounted for 58% of MENA growth, likely driven by Saudi Arabian infrastructure investment and the 14 giga projects as set out in Saudi Arabia’s Vision 2030.

Each is huge in scale and ambition, and many are directly funded by the country’s sovereign wealth fund, the Public Investment Fund, with total estimated assets of $925 billion.

Media owners, publishers, and advertisers must strategize about how best to tap this MENA marketplace. It means navigating the rapid shifts in digital advertising like everyone else – the surge of streaming services, the growth retail media networks, the demise of the third-party cookie, the need to leverage first-party data, and more. But of course, all of these changes have to be considered regionally, especially when it comes to privacy policy around data.

Identity and privacy in the Middle East

As a diverse region of 18 countries, there is no one single data privacy policy like the General Data Protection Regulation in the EU.

Although countries are starting to bring individual policies into practice, like the personal data protection laws in both the United Arab Emirates (UAE) and Saudi Arabia, there is still a significant amount of gray area in terms of how data privacy, international borders and other policies will interact.

"The region is a retail magnet, as evidenced by some of the largest shopping malls in the world."

Everyone in digital marketing in the Middle East — and around the world — needs to prepare for the phasing out of the third-party cookie and educate themselves about alternative identity solutions.

Advertisers need to have a robust strategy on how to leverage first-party data and understand new identity options.

Publishers need to require a reliable strategy for authentication of their readers to enable more precise targeting options for their advertising clients. 

It is unlikely that only one identity solution will rule them all, but rather there will be a patchwork of different options to assemble a meaningful depiction of consumer behavior and engagement across all online channels.  

The retail data opportunity

The region is a retail magnet, as evidenced by some of the largest shopping malls in the world. Countries seeking to diversify away from oil are further adding significant retail and tourism options.

According to Mastercard Economics Institute, real consumer spending across the UAE is forecast to grow by 5% year on year in 2024, while Saudi Arabia will see growth of 4.3%.

As for tourist spending, countries in the Persian Gulf saw a 22% increase in inbound visitor spending last year compared to 2019, which was higher than the global average by 26 percentage points.

Retail data will likely be a crucial piece of the omnichannel puzzle as it provides an all-inclusive view of the broader digital marketing journey. In the MENA region, this is still a very new monetization opportunity and one that could yield significant results and successes for the participants.

Activating data from retailers to reach the right audiences on the open internet can provide powerful insights for targeting and measuring success. The decision by major retailers to offer data and information on shopper behavior is a key leap and opportunity for advertisers.    

In addition, UAE consumers show more willingness to share information with brands and retailers than consumers in key European markets, according to a recent survey by The Trade Desk in partnership with market research company YouGov.

Almost half of respondents, 49%, indicated they are willing to share their information with retailers and brands that they love, and 44% would do so in exchange for a convenient and personalized ad experience. And 46% of respondents agreed that to have a seamless shopping experience, they need to allow brands to capture some data.​

Connected TV on the rise

The rise of connected TV (CTV) viewing habits in the UAE is a result of the growth of streaming platforms and the availability of diverse content.

The shift from traditional advertising channels to digital is inevitable, as consumers today spend a lot of time on connected devices, including smartphones, CTVs and computers, and are exposed to digital out-of-home screens.

According to a recent survey, 65% of UAE residents watch streaming content daily. The survey highlights a shift toward CTV, as streaming content accounts for an average 11% of weekly time spent.

In fact, UAE respondents claim they spend more time on premium video streaming per week versus most social media channels.

This story is repeated throughout the region. As digital players are beginning to dominate, advertisers are seeking greater inventory targeting opportunities, data transparency and opportunities to reach wider audiences.

The traditional media buying model of insertion orders and upfronts is being challenged by technological advancements and higher-precision advertising.

The Current is owned and operated by The Trade Desk, Inc.