Retail Is The New Tourism: UAE's Shopping Scene Evolves Into Experiential Powerhouse

Once synonymous with luxury malls and mega sales, retail in the UAE has transformed into a dynamic force driving tourism, cultural engagement, and economic growth. Industry leaders say the sector is no longer just about transactions - it's about immersive experiences, storytelling, and emotional connection.

“Retail has always been a cornerstone of the UAE's tourism offering - from Dubai Shopping Festival to destination shopping experiences,” said Ganesh Iyer, Founder & Managing Partner at FLC Marketing Group.“Today, it's about tourism-led retail storytelling. We've seen how immersive mall activations and brand takeovers drive both footfall and dwell time, turning retail into an economic and cultural attraction.”

This sentiment is echoed by Shuja Jashanmal, Group CEO of Jashanmal Group, who emphasised retail's deep-rooted role in the UAE's identity.“Shopping is the invisible thread weaving through every visitor's UAE experience. Our stores have become destinations where travelers experience international luxury paired with the UAE's hallmark service and retail excellence.”

Retail's contribution to Dubai's GDP stands at a significant 20 per cent, according to the Yardstick Marketing Management Retail Report, underscoring its role as a pillar of economic growth.

Shoppertainment: From novelty to necessity

With the rise of e-commerce, physical retail spaces have had to reinvent themselves. The concept of“shoppertainment” - a blend of shopping and entertainment - has evolved into a strategic necessity.

“At The Little Things, we design every store visit to be more than a transaction,” said Hassan Tamimi, CEO of The Little Things.“It's about the emotional connection we forge with every individual. From scavenger hunts and cosplay parades to interactive pop-ups, we co-create moments that capture attention and build excitement.”

Jashanmal agrees:“The 'shoppertainment' revolution isn't about choosing between digital and physical; it's about fusing them in ways that surprise and delight. Screens can't replace the innate human desire for tactile experiences.”

Phygital retail: Where online meets offline

The UAE's retail sector is embracing“phygital” innovation - merging physical and digital experiences to meet evolving consumer expectations.

“Phygital retail is now an ecosystem,” said Iyer.“Consumers browse online, research on mobile, and buy in-store or vice versa. Our integrated approach includes QR codes unlocking gamified discounts and retail zones doubling as content studios.”

Tamimi highlighted the rise of AI, AR/VR, and IoT in retail.“Smart retail is here. We use sensors to track customer movement, personalise experiences, and offer real-time assistance. It's about making the brand experience consistent, connected, and convenient.”

Jashanmal added that predictive inventory and mobile-first operations are redefining the shopping journey.“Retail environments are becoming intuitively aligned with human behaviour - less like a transaction and more like a conversation.”

Malls as cultural hubs

In an era dominated by online shopping, malls are reinventing themselves as experiential destinations.

“Malls must transform into cultural and experiential hubs,” said Iyer.“We support mall partners with immersive experiences - from tech-enabled zones to family workshops - that convert footfall into fandom.”

Tamimi noted that malls should function like media platforms.“Our store openings are launch experiences. A recent example is our Red Sea Mall activation in Saudi Arabia, where our mascot led a parade that drew massive attention. These activations elevate the entire mall ecosystem.”

Jashanmal emphasised the importance of seasonal engagement.“From summer travel activations to pop-ups, malls must become multi-sensory stages where discovery transcends transactions.”

Smart promotions and data-driven growth

Discounts and prize offers remain effective, but only when layered with engagement and storytelling.

“Campaigns perform better when rewards are tied to participation or social sharing,” said Iyer.“Use tiered prize structures or QR-linked draws to gamify shopping.”

Tamimi reported tangible results:“We've seen up to a 40 per cent spike in footfall and a 25 per cent increase in basket size during key campaigns.”

Jashanmal's Back-to-School initiative exemplifies this strategy.“We introduced a reward-led promotion across our stores, creating excitement and reinforcing our position as a trusted, experience-driven brand.”

Outlook: Retail-tourism synergy strengthens

Recent data paints a promising picture. Dubai welcomed 9.88 million international visitors in H1 2025, with hotel occupancy reaching 83 per cent in Q1. Retail trade in Abu Dhabi grew 3.6 per cent, contributing Dh16 billion to GDP. Ras Al Khaimah recorded its best-ever H1, with tourism revenue up 9 per cent.

“The UAE's retail and tourism sectors continue their strong momentum,” said Jashanmal.“When retail blends global luxury with local cultural relevance, it becomes an integral part of the UAE's enduring appeal.”

As the lines between commerce, culture, and entertainment blur, retail is no longer just a shopping experience - it's a tourism strategy, a storytelling platform, and a driver of national identity.

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