UAE retailers are investing heavily in artificial intelligence (AI) to reshape customer experiences, but shoppers remain unconvinced, according to the new AI in Retail Report 2025 by SAP Emarsys.
Now in its third year, the report draws on insights from more than 200 marketers and 1,000 consumers across the UAE. It highlights a growing disconnect between retailers’ ambitions and customer perceptions. While 82% of UAE marketers say AI is central to their personalization efforts, only 31% of consumers feel brands tailor content to their needs. Just 18% believe they receive fair value in exchange for their personal data.
The findings reveal a deeper structural challenge. More than two-thirds of marketers (69%) admitted their data is too unstructured to use effectively, while an equal share acknowledged they struggle to act on insights in real time. With fragmented systems and inaccessible “dark data” affecting 64% of marketers, brands risk delivering impersonal, disjointed experiences that erode consumer trust.
“From a consumer’s point of view, the value exchange is broken,” said Marwan Zeineddine, Managing Director of SAP UAE. “You share your data but get little in return with no visibility into how it’s used. That’s where trust breaks down and loyalty is lost.”
The report identifies two main drivers of this trust gap. First, data use remains opaque, with only 35% of consumers expressing high confidence in how brands manage their personal information. Consent processes, it suggests, are often perceived as performative rather than meaningful. Second, the perceived value exchange is weak. Shoppers frequently share personal details, from browsing behaviour to purchase history, only to receive repetitive or irrelevant marketing.
However, the study also highlights brands demonstrating how AI can enhance—not damage—customer relationships. Guitar maker Gibson is cited as an example of an “Engagement Era” brand: one that uses AI not simply for automation, but for building authentic connections.
“We’re not selling t-shirts, we’re selling guitars,” said Sterling Doak, Head of Marketing at Gibson. “AI helps us personalize with purpose, without losing the soul of the brand.”
Gibson now attributes more than 40% of its revenue to automation-led campaigns powered by SAP Emarsys. Engagement rates have doubled, while email-driven sales have risen by 50%.
According to SAP Emarsys, the path forward for UAE retailers lies in transparent use of first-party data, consistent cross-channel engagement, and ensuring a fair exchange of value. Without these foundations, AI risks becoming “just another marketing tool that drives consumers away.”
These themes will be in focus at the Middle East Retail Forum 2025, opening on 3 September in Dubai. SAP Emarsys executive Younès Ben Maïz will join a panel on retail transformation and lead a roundtable on emerging AI trends.
